Richoux swings to loss on living wage, increased competition

9th Sep 2016 10:07

(ShareCast News) - Richoux swung to a loss in the 28 weeks to 10 July as the company was hit by increased competition and the new minimum wage.The restaurant operator reported a pre-tax loss of £579,000 compared to a profit of £320,000 in 2015. Adjusted earnings before interest, tax, depreciation and amortisation fell to £0.28m from £0.79m.Richoux had a cash balance of £3.09m at period end, compared to £4.40m in December 2015.Chairman Philip Shotter said: "In line with a number of other restaurant groups, trading conditions have been difficult during the period as we continue to face the challenge of increased competition at a number of sites as well as increased property and staff costs, the latter due largely to the impact of the living wage."We are pleased to have opened two further Dean's Diner restaurants and one further Villagio restaurant, although handover of what will be the tenth Dean's Diner site has been delayed until 2017 due to delays on the part of the developer. A decision has also been made to recognise impairment charges against three sites which are underperforming." At 1015 BST, Richoux shares were down 8.4% to 20.60p.