Sapphire Foods reported a consolidated net profit of ₹140.22 million for the quarter ended June 30, 2026 (Q1FY27), marking a significant turnaround from the net loss of ₹17.38 million in the corresponding period of the previous year. The improvement was driven by an increase in revenue from operations to ₹8,909.60 million from ₹7,768.28 million year-on-year, alongside improved operational efficiency that expanded the EBITDA margin to 15.7% from 14.53%. This return to profitability underscores the effectiveness of cost management measures and top-line growth in the restaurant operating segment.

The Board of Directors, at its meeting held on July 24, 2026, approved the unaudited standalone and consolidated financial results. The results were reviewed by the Audit Committee and subjected to a limited review by M/s. Deloitte Haskins & Sells, Chartered Accountants, the statutory auditors of the company. The financial statements were prepared in accordance with Indian Accounting Standard 34 (Ind AS 34) "Interim Financial Reporting" and comply with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Financial Performance Overview

On a consolidated basis, total income stood at ₹8,966.31 million, comprising revenue from operations of ₹8,909.60 million and other income of ₹56.71 million. Total expenses amounted to ₹8,804.64 million, including cost of materials consumed (₹2,780.57 million), employee benefits expense (₹1,153.45 million), finance costs (₹319.31 million), depreciation and amortisation (₹973.62 million), and other expenses (₹3,577.69 million). Profit before tax was ₹161.67 million, against which tax expense of ₹21.45 million was charged, resulting in the net profit after tax of ₹140.22 million.

Standalone results also showed a turnaround, with net profit after tax reaching ₹128.67 million compared to a loss of ₹34.04 million in Q1FY26. Standalone revenue from operations increased to ₹7,560.72 million from ₹6,603.95 million in the prior-year quarter. Earnings per equity share on a consolidated basis were ₹0.44, up from (₹0.06) in the previous year.

Operational Highlights and Brand Performance

Q1FY27 marked the second consecutive quarter of strong performance, with restaurant sales reaching ₹8,882 million, up 15% year-on-year — the best growth in the last 11 quarters. Adjusted EBITDA grew by 37% to ₹749 million, the highest growth in 15 quarters, with margins expanding by 130 basis points to 8.4%. Consolidated EBITDA stood at ₹1,406 million (15.8% margin), up 24% year-on-year.

Sapphire Foods added 16 KFC restaurants, 5 Pizza Hut outlets in India, and 1 Pizza Hut in Sri Lanka during the quarter, bringing the total restaurant count to 1,074 as on June 30, 2026. Same-store sales growth (SSSG) was positive across all verticals:

• KFC India: Revenue grew by 17% with SSSG at 5%. Restaurant EBITDA margin improved by 120 basis points to 16.9%, despite high energy cost inflation. Growth was driven by a two-pronged consumer recruitment strategy including the ₹99 Chicken Krisper Burger Meal and Buy-One-Get-One-Free offers on Chicken Buckets.
• Pizza Hut India: Delivered positive SSSG of 1% after five quarters, with Dine-In SSSG also positive. Revenue grew by 3%, though Restaurant EBITDA remained negative at -3.6% due to higher gas costs. Tamil Nadu territory continued to perform well due to targeted marketing investments.
• Sri Lanka Business: Revenue grew by 14% in LKR terms with SSSG of 9%. Restaurant EBITDA margin was 12.0%, impacted by minimum wage revisions and geopolitical conflict-related inflation.

Merger Progress and Regulatory Approvals

A key development noted by the Board is the progress of the scheme of arrangement between Sapphire Foods India Limited (Transferor Company) and Devyani International Limited (Transferee Company). Approved under Sections 230 to 232 of the Companies Act, 2013, the scheme envisages the amalgamation of Sapphire Foods into Devyani International with effect from April 01, 2026. Under the terms, shareholders will receive 177 equity shares of Devyani International for every 100 shares of Sapphire Foods held.

The company received a 'no objection' observation letter from the National Stock Exchange (NSE) and 'no adverse observations' from the Bombay Stock Exchange (BSE) on June 12, 2026. The scheme remains subject to further regulatory and statutory approvals.

Operational and Structural Updates

Additionally, the Board noted the completion of the shifting of the company's registered office from Maharashtra to Haryana. The Regional Director (Western Region Directorate I) approved the shift on April 21, 2026, and the Registrar of Companies, Haryana, issued the Certificate of Registration on May 18, 2026, recording the new address at SCO 328, Sector - 9, Panchkula. The group continues to operate in a single reportable segment: restaurant operations.

What the Numbers Show

The swing to profitability in Q1FY27 is primarily operational, driven by robust revenue growth of approximately 14.7% year-on-year on a consolidated basis. Notably, there were no exceptional items in the current quarter, unlike the previous year where merger-related charges and labour code impacts had weighed on results. The absence of such one-time costs, combined with margin expansion, indicates a stabilisation of the core business model ahead of the proposed merger. The divergence between consolidated EBITDA margin (15.8%) and adjusted EBITDA margin (8.4%) highlights the significant impact of Ind-AS 116 lease adjustments on reported profitability metrics.

Source: https://lodr-files.dhan.co/lodr-inputs/Company/INE806T01020/c94cbe8e-2900-434f-832a-485467747a58.pdf

Sapphire Foods India Limited held its 17th Annual General Meeting on July 21, 2026, through video conferencing. Shareholders approved nine resolutions, including the adoption of financial statements for FY26 and the re-appointment of key leadership personnel. The meeting was chaired by Independent Director Sunil Chandiramani, and the statutory auditors, M/s. Deloitte Haskins & Sells, were present.

The special business focused on leadership continuity. The company secured shareholder approval to re-appoint Mr. Sanjay Purohit as Whole-time Director & Group CEO and Mr. Sunil Chandiramani as Chairman and Independent Director for a second term. Additionally, Independent Directors Ms. Deepa Wadhwa and Ms. Anu Aggarwal were re-appointed for second terms. The ordinary business included the re-appointment of Mr. Vijay Jain and Mr. Kabir Thakur, who retire by rotation, and the appointment of Mr. Vikram Agarwal as a Non-Executive Nominee Director.

Voting Results Summary

The voting results, declared based on the Scrutinizer's Report dated July 22, 2026, indicated that all resolutions were passed with the requisite majority. Remote e-voting was conducted from July 17, 2026, to July 20, 2026, with e-voting facilities also available during the meeting. The total number of shareholders on the record date, July 14, 2026, was 58,522.

Mr. Alwyn D'souza of M/s. Alwyn D'Souza & Co. served as the Scrutinizer for the e-voting process. The meeting concluded at 6:03 P.M. on July 21, 2026.