* Sees FY earnings at top end of expectations
* December LFL sales up 1% at Wagamama
* Shares up 3%
(Adds shares, background, peers)
By Muhammed Husain
Jan 21 (Reuters) - Britain's Restaurant Group
forecast annual profit at the top end of its expectations on
Friday as the Wagamama owner reined in costs to deal with food
and drink inflation and labour market pressures.
Shares in the company were up as much 3% after it estimated
adjusted core profit would come in at the top end of its
projection range of 73 million pounds to 79 million pounds ($99
million-$107 million) for the year ending Jan. 2.
The group, which runs restaurants, pubs and kiosks in travel
hubs, welcomed the recent lifting of curbs in Britain imposed
ahead of Christmas, but cautioned that consumer confidence will
take longer to recover.
Restaurant Group said sales at its Wagamama chains grew at a
slower pace in December due to restrictions related to the
Omicron COVID-19 variant, but that the group overall
outperformed the broader market.
Other pub operators such as JD Wetherspoon and
Mitchells & Butlers saw a drop in Christmas sales after
the Omicron variant winter surge left venues largely empty
during what should have been one of their busiest periods.
"Although the UK government has now removed most
COVID-related restrictions, we expect some impact on revenues in
January and a slightly hesitant recovery through Q1 (not least
from air travel)," analysts at Citi said.
Restaurant Group had flagged staff shortages and supply
chain constraints last year on its road to recovery from
pandemic lows and warned that inflationary cost pressures would
last through its fiscal 2022.
In the past year, it has restructured its Leisure and
Concessions businesses, and shuttered a significant number of
sites in the first half of 2021 and in 2020.
Its like-for-like December sales across its leisure,
concessions and pub categories fell compared to 2019 levels.
Sales at its Wagamama chains grew 1% in December, from 8% in
November and 11% in October.
($1 = 0.7358 pounds)
(Reporting by Muhammed Husain and Yadarisa Shabong in
Bengaluru; Editing by Uttaresh.V and Jan Harvey)
