Burger chain Wendy's 'sees 50% rise' in UK energy costs

US burger chain Wendy’s has said it is facing a “heavy headwind” of pressures in the UK with energy costs for its restaurants rising between 50% and 60%.

The company’s chief financial officer Gunther Plosch said its margins were being squeezed and sales in UK sites were slightly slower than expected.

However, he said these issues were “temporary” and the potential for expansion in the UK remained “compelling”.

“[This is] evidenced by UK entrepreneurs signing up as franchisees as they believe in the potential of these markets...[these problems are] a speed bump and not more," Plosch added.

Wendy’s returned to the UK in 2021 after a 20-year absence and has since opened nine restaurants in Reading, Stratford, Oxford, Brighton, Ilford, Camden, Romford and Maidstone.

It also runs a number of delivery kitchens in partnership with 'dark kitchen' expert Reef.

Speaking on an investor call, Wendy’s chief executive Todd Penegor said the UK was the “key pillar” to driving the chain's expansion across Europe.

He added: “Our big opportunity in Europe is to build out the UK first, we continue then to think about how we would get into Ireland and leveraging the supply chain that we have built up in the UK, then over time into Spain.

“It’s one we’re going to have to watch and see. With the consumer economic backdrop and the macroeconomic backdrop, does that [expansion] take a little longer than what we had originally thought? Time will tell.”

Wendy's was founded in Columbus, Ohio in 1969 and now operates more than 6,800 restaurants worldwide.

The chain ran around 10 company-operated UK restaurants in the 1990s but shut them down after complaining of high operating costs.

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