Westlife Foodworld Ltd, which owns the McDonald’s Corp franchise in western and southern India, reported a lower-than-expected rise in fourth-quarter earnings on Tuesday as high prices of staples caused customers to hold back on spending discretionary.

The company said its consolidated profit after tax for the March quarter jumped 31% to 200.9 million rupees ($2.46 million), missing analyst estimates by 263.7 million. of rupees, according to data from Refinitiv IBES.

Most fast-food restaurants in India have seen a slowdown in recent months as higher prices on everything from milk to fuel have dented consumer spending on non-essentials, analysts said.

Westlife‘s off-premise business, which includes online ordering and delivery, saw a 5% increase, while its on-premise business, which includes restaurants and take-out, grew 38%.

Operating margin climbed 34% to Rs 1.36 billion, although costs remained elevated at 19%, with employee benefits costs rising 47%.

Westlife opened 18 new restaurants in the quarter in line with its expansion plans.

The goal is to add 40 to 45 new stores in the next financial year, and 580 to 630 stores by 2027.

The sale of products increased by 22.5% to 5.44 billion rupees.

Rival Jubilant Foodworks, which operates the Domino’s Pizza restaurant chain in India, will present its quarterly results next week.

Shares of Westlife closed 3.5% down on Tuesday after the results.

(1 dollar = 81.7800 Indian rupees)