Cooks Coffee Accelerates Growth with Dubai and India Expansion

Strong Sales and EBITDA Growth in Core Markets

Cooks Coffee (NZX:CCC) delivered a robust FY26 performance with group store sales in the UK and Ireland climbing 22.8% to NZ$95.8 million, up from NZ$78.0 million the previous year. This translated into a 27% increase in normalised EBITDA to NZ$1.69 million, despite a modest 14.3% rise in reported EBITDA to NZ$1.39 million after accounting for one-off UK transactions worth NZ$0.5 million.

The company expanded its Esquires brand footprint by 18%, growing total sites to 105 across the UK and Ireland. The UK saw 21 new store openings offset by 9 closures, ending with 82 stores, while Ireland increased its outlets by 35% to 23. Like-for-like sales also improved, up 1.8% in the UK and 4.9% in Ireland, underscoring steady organic growth alongside network expansion.

International Expansion Gains Momentum with Dubai and India

Beyond its core markets, Cooks Coffee confirmed plans to open two new Esquires stores in Dubai and one in India within three months, marking significant steps into high-growth international territories. These moves follow master franchise agreements signed in late 2025 to develop the UAE and Indian markets, leveraging established UK franchisees for the UAE venture.

The international business currently generates systemwide sales of NZ$9.4 million across Saudi Arabia, Pakistan, Portugal, and Jordan, with store numbers stable or slightly growing. The new Middle Eastern and Indian stores aim to capitalize on rapidly expanding coffee culture in these regions.

Strategic Partnerships and Franchise Awards Strengthen Market Position

Cooks Coffee’s partnership with Tesco Ireland expanded to six stores within Tesco outlets, including locations at Tullamore, Clonmel, Youghal, Waterford, Wexford, and Liffey Valley. This collaboration contributed to a 29% increase in continuing store sales in Ireland, reaching NZ$30.5 million.

The company also benefited from the performance of four company-managed Dairygold stores, which contributed NZ$5.3 million in sales, representing 17.6% of Irish store sales. Esquires Coffee Ireland’s franchise network was recognised with the Franchisor of the Year award (Food and Non-Food), while franchisees Manish and Stuti Basu received Franchisee of the Year (Food and Beverage) honors.

Balance Sheet Improvements Amid Going Concern Uncertainty

Despite operational gains, Cooks Coffee reported net liabilities of NZ$1.9 million and current liabilities exceeding current assets by NZ$1.68 million as of 31 March 2026. Debt was reduced from NZ$4.2 million to NZ$2.5 million, reflecting ongoing efforts to strengthen the balance sheet.

The auditor’s report highlighted a material uncertainty related to going concern due to these net liabilities and liquidity pressures. However, the Board expressed confidence in managing cash flows, citing contractual commitments from regional franchisees to open 20 new stores annually and ongoing efforts to sell master franchise rights in new regions.

Outlook: Continued Store Growth and Market Penetration

The new financial year has started strongly with four new UK stores and three in Ireland already opened. The company expects to open the committed Dubai and India stores in the second quarter of FY27. Management projects adding more than 300 stores in the UK and Ireland by FY34, well ahead of industry growth rates, which are forecast at around 3% annually.

While the company’s average UK store sales rose 4.9% in FY26 to £381,000, the Irish stores deliver higher average sales with a larger footprint. The international expansion strategy, combined with disciplined network growth and strong franchisee support, positions Cooks Coffee to capitalize on both mature and emerging markets.

Investors should watch how the Dubai and India entries perform and whether the Tesco partnership in Ireland scales further, as these will be key drivers of future revenue and profitability. The going concern uncertainty remains a cautionary backdrop, underscoring the importance of cash flow management and franchise network execution.