Guzman y Gomez Exits US with A$30–40M Charge, Shares Soar 21%
Guzman y Gomez will close all Chicago restaurants and exit the US market, taking a A$30–40 million exit charge. Its Australian business is set to deliver underlying earnings of A$85 million for the year to June, up 29%, while shares jumped 21% on the news.
1. US Exit Decision
Guzman y Gomez announced it will close its Chicago restaurants and exit its entire US business after failing to generate adequate sales. The board determined that continued investment was unjustified given the low prospects for profitability.
2. Financial Impact and Market Reaction
The company will incur a one-off A$30–40 million charge related to the US exit, but investors responded positively, driving the share price up 21% in early trading. Analysts have characterized the decision as removing a drag on group earnings.
3. Australian Business Performance
For the year ending June, the Australian operations are expected to deliver A$85 million in underlying earnings, marking a 29% increase from the prior year. This strong domestic performance now constitutes the core driver of group results.
4. Strategic Outlook
With resources freed from the US venture, leadership will refocus on scaling the Australian franchise toward a long-term target of 1,000 restaurants. Founder Steven Marks will return to Australia to oversee local expansion and operational improvements.