TRG sees sales rise but £62.6m losses as it restructures & secures extra funds

The Restaurant Group (TRG), the UK casual dining giant with over 650 restaurants and pub restaurants, has reported interim results for the 26 weeks ended 28 June 2020.

The group made a decisive response to COVID-19 pandemic, implemented significant restructuring actions, resulting in a higher quality, diversified estate, with very encouraging trading since reopening.

TRG, which operates brands Wagamama, Frankie & Benny's, Brunning & Price, Coast To Coast, Garfunkels, and Joes Kitchen, has secured additional funding, covenant waivers, and increased tenure from its banking group.

The group reported a £62.6m loss before tax for the fist six months of 2020, and net debt of approximately £311m, which was considerably better than anticipated.

Trading performance post-lockdown (for the 11 weeks from 4 July to 20 September) with c.90% of the retained estate now open has been very encouraging:
Wagamama: Like-for-like (LFL) sales growth of 11%, outperformance of 5% versus the market.
Leisure: LFL sales growth of 4%, broadly in line with the market1, representing strongest trading performance in over five years.
Pubs: LFL sales growth of 14%, exceptional outperformance of 20% versus the market.
Concessions: Disciplined reopening programme focused on EBITDA delivery. LFL sales declined by 58%, 15% ahead of passenger volumes.

Outlook
The group retains a cautious outlook for the short term given the ongoing impact of pandemic and government-imposed restrictions.

The restructured business is well positioned to adapt to the challenges being faced and deliver long term shareholder value.

Andy Hornby, Chief Executive Officer, commented, “It has been an extraordinary and difficult period for the hospitality sector but one in which we have pulled together to achieve a great deal.

'The priority throughout has been the safety of our colleagues and customers, and we have also accelerated the reshaping of our portfolio, resulting in a higher quality, diversified estate.

'Since reopening, I am genuinely pleased with the strength of our trading performance and would like to sincerely thank each and every one of our colleagues for their extraordinary efforts.

'Whilst the sector outlook is uncertain, and we are mindful of recent restrictions across the UK, we are confident that the actions we have taken provide us with strong foundations to emerge as one of the long-term winners.”