26th Feb 2014 08:13
LONDON (Alliance News) - The Restaurant Group PLC Wednesday reported higher profits and revenues for its last financial year, driven by new pub and restaurant openings and higher sales from existing outlets, and said it will open a further 36 to 43 new restaurants in 2014.
The company, which operates under brands including Frankie & Benny's, Chiquito, Coast to Coast and Garfunkel's, reported a pretax profit of GBP72.7 million for the year to December 29, 2013, compared with GBP64.6 million a year earlier, as revenues rose to GBP579.6 million, from GBP532,5 million. Its net profit rose to GBP56.2 million, from GBP48.2 million.
Growth was driven by the opening of 35 new restaurants, taking its portfolio to over 440, while like-for-like sales from outlets open for more than a year grew 3.5%.
"With the UK economy showing improvement, employment levels rising and inflation falling there are good prospects for an improvement in household finances. This bodes well for our sector and all of our team will be working determinedly to deliver another year of profitable progress," Chief Executive Andrew Page said in a statement.
The company's operating margin rose 40 basis points to 12.9% as it kept close control of costs and kept discounting and promotions at a low level.
It said the food cost inflation it has seen in recent years started to slow in the second half of 2013 and it expects a "slightly more benign" environment in 2014. However, it expects wages to continue firming as the economy improves. It is also seeing rises in energy costs and modest rent increases.
The company funds its store expansion programme mainly from cashflow, which rose to GBP116.8 million in fiscal 2013, from GBP102.0 million a year earlier. Its net debt stood at GBP41.9 million at the end of the financial year, up from GBP36.0 million a year earlier, mainly due to the increase in dividend payments.
The Restaurant Group said it will pay a final dividend of 8.75 pence, bringing its total for the 2013 financial year to 14.0p, up from 11.8p in fiscal 2012. It said the increase reflected its strong performance.
The Restaurant Group shares were up 0.4% at 657 pence early Wednesday.
By Steve McGrath; [email protected]; @SteveMcGrath1
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