21 Jan 2022 07:00
The Restaurant Group plc
The Restaurant Group plc ("The Group" or "TRG") -Trading update
In TRG's last market update on 16 November 2021, the Group provided guidance that on an IAS 17 basis it expected FY21 Adjusted EBITDA to be a range of £73m-£79m and FY21 year-end Net Debt was expected to be less than £190m. The Group is pleased to announce that due to good cost control and continued strong trading relative to the market, management now expects the Group's FY21 Adjusted EBITDA will be at the top end of the range and FY21 year-end Net Debt will be less than £180m.
The introduction of the UK Government's "Plan B" in early December which included advice to work from home, calls for further caution in socialising and increased testing requirements for international travel reduced consumer confidence and put additional restrictions on the hospitality and travel sector. To illustrate the impact on customer demand across the sector, The Group is providing an update on trading trends for Q4 2021 by month, for both it's divisional like-for-like*("LFL") sales performance and relevant market benchmarks (as measured by Coffer Peach)**:
TRG LFL sales (%) vs 2019 comparable for Q4 2021
| Oct | Nov | Dec |
Wagamama | +11% | +8% | +1% |
Leisure | +16% | +8% | (2%) |
Pubs | +9% | +7% | (7%) |
Concessions | (34%) | (24%) | (34%) |
Market LFL sales (%) vs 2019 comparable for Q4 2021
| Oct | Nov | Dec |
Coffer peach restaurants | +8% | +7% | (4%) |
Coffer peach pub restaurants | 0% | (1%) | (12%) |
UK airport passenger numbers | (49%) | (40%) | (47%) |
It is clear from the trends that:
· In both the Restaurant and Pubs markets LFL sales (as measured by Coffer Peach) were 10% to 12% lower in December than in October and November
· TRG continued to trade ahead of the market demonstrating our ability to out-perform in all market conditions
Whilst we are encouraged with the recent Government announcement that all "Plan B" restrictions will be lifted next week, we expect consumer confidence may take longer to recover. We are also mindful that the recovery in air passenger volumes remains dependant on the timing of changes to both UK and International restrictions.
Despite the near-term uncertainties, the Board remains confident in the Group's prospects given the strength of our brands, substantially reduced net debt and outperformance versus the market.
The Group's next scheduled update is the preliminary results announcement on 16 March 2022.
* Like-for-like sales versus 2019 comparable
**Market refers to Coffer Peach tracker for restaurants (Wagamama and Leisure benchmark) and Coffer Peach tracker for pub restaurants (TRG Pubs benchmark). UK air passenger growth used as market benchmark for Concessions
Note: Oct refers to the period of 4 weeks to 31 October 2021; Nov refers to the period of 4 weeks to 28 November 2021; Dec refers to the period of 5 weeks to 2 January 2022
Enquiries:
The Restaurant Group plc Andy Hornby, Chief Executive Officer Kirk Davis, Chief Financial Officer Umer Usman, Investor Relations
| 020 3117 5001 |
MHP Communications Oliver Hughes Simon Hockridge | 020 3128 8789/8742 |
Notes:
1. Statements made in this announcement that look forward in time or that express management's beliefs, expectations or estimates regarding future occurrences are "forward-looking statements" statements and reflect the Group's current expectations concerning future events. Actual results may differ materially from current expectations or historical results
2. The 2021 Financial Year is a 53 week period ending 2 January 2022