Restaurant Group confident on prospect after good 2013

26th Feb 2014 08:35

The Restaurant Group, owner of the Frankie and Benny's and Garfunkel's brands, posted healthy full-year numbers and struck a confident note on outlook, noting it has made a strong start to its new year and that the improving UK economy bodes well for its operations over 2014. Pre-tax profits for its year to December 2013 rose 13% to £72.7m on revenue ahead 9% to £580m. Like-for-like sales advanced 3.5%. Group operating margin improved 40 basis points to 12.9%, with operating cashflow encouraging, up 15% to £116.8m. Earnings per share increased 16% to 28p.The group, which operates over 440 restaurants and pub restaurants, assured its expansion plans remain on track, thanks to the healthy cashflow, with 35 new sites opened during 2013. These are trading well and set to deliver "excellent returns". The group is targeting 36 to 43 new sites for 2014. It assured that current trading is "strong", with total sales up 10% and like-for-like sales at 3.5% for the eight weeks to 23 February 2014. Andrew Page, Chief Executive of The Restaurant Group, hailed the results, adding: "Over 2013 we created over 1,000 new jobs and this year we will create even more as we expect to open a further 36 to 43 new restaurants. Page said that with the UK economy looking to be on the mend, employment levels rising and inflation falling, there are good prospects for an improvement in household finances, which bodes well for restaurant sector. Page, who retires from his post at the end of August, believes The Restaurant Group is in "great shape" and is well placed to continue delivering: "Looking forward over the next two to three years the quality and quantity of our forward pipeline is the best that we have seen for many years."There is a final dividend of 8.75p per share to give a total for the year of 14p up 19% from 11.8p in 2012. Following a good run over February, Restaurant Group shares eased in early morning trade, falling 11.5p or 1.7% to 643p, valuing the company at £1.3bn. KP