Freshii Inc. is planning to double its store count in Canada as the company plots an ambitious path out of the pandemic.
The Toronto-based company behind the healthy fast food franchise said Tuesday it has completed an extensive real estate review and developed a growth plan for the Canadian market.
Matthew Corrin, chairman and chief executive of Freshii, said the company has about 270 Freshii locations in Canada, but the market could support twice that number.
"We expect growth in Canada will come from both new and existing franchise partners looking to add more locations, which is a trend we are already seeing," he said in an email. "A good example is our Whistler Village location opening this winter, which is an existing B.C. franchise partner adding more stores in great real estate."
Freshii chief financial officer Daniel Haroun told analysts during a conference call that the company sees "significant runway to grow units across North America, including room to more than double our store base in Canada alone."
"With the impact of the pandemic expected to further reduce in 2022 with increasing vaccination rates and the relaxing of government restrictions, we intend to make considerable investments ... to grow our franchise development pipeline and accelerate unit growth in 2023 and beyond," he said.
Freshii reported $5.8 million in revenue during its third quarter Sept. 29, up from $4.8 million a year earlier.
Same-store sales were up 10.6 per cent compared with the same quarter last year.
The company had 372 locations open and operating across its network at the end of the quarter — an increase of eight locations from the end of the previous quarter.
Freshii's suburban locations have recovered from pandemic restrictions faster than its downtown urban restaurants, reaching about 90 per cent of its pre-pandemic sales.
However, a dozen locations remain temporarily closed, primarily in airports, malls and business districts that remain closed or quiet as a result of COVID-19 pandemic restrictions.
"We are encouraged by seeing growth in same store sales versus Q3 of 2020 but continue to see locations that are heavily reliant on office traffic be impacted by many employers delaying their return to office plans," Haroun said.
"We continue to see our suburban locations recover faster than the rest of our network as these locations — which represent 55 per cent of our North American store network — recovered more than 90 per cent of pre-pandemic third quarter 2019 sales."
Freshii reported a net loss attributable to the company of $749,000 or two cents per share for the 13-week period, compared with a net loss attributable to the company of $130,000 or zero cents per share in the same quarter last year.
On Monday, Freshii announced a deal with a hospitality operator to open 20 new restaurants in the United States over six years — the largest multi-unit franchise agreement in the company's history.
The company said the agreement with Level Hospitality will see locations opened in Texas, with a focus on Houston and Austin.
Freshii also recently purchased a majority stake in health and wellness product retailer Natura Market ECommerce Inc., with rights to acquire the rest of the business through the first quarter of 2025.
This report by The Canadian Press was first published Nov. 9, 2021.
Companies in this story: (TSX:FRII)
Brett Bundale, The Canadian Press