The Restaurant Group, which owns casual dining chain Frankie & Benny’s, has reported a 26.4% fall in pretax profit.
The company, which operates 498 restaurants and pubs in the UK under brands including Chiquito and Coast to Coast, reported an underlying pretax profit fall of £56.7m in the year ended 31 December, compared with a £77.1m profit last year.
The company is one of several businesses in the casual dining sector currently struggling as Britons spend less on eating and drinking out. So far this year chains including Jamie’s Italian, Prezzo, Byron, Strada and Carluccio’s have all reported site closures or restructuring.
The Restaurant Group has also suffered from rising competition from pubs serving foods as well as reduced footfall in retail parks, where many of their sites are located.
Sales slump
In January the company said that its sales at outlets that had been open for over a year fell by 3%, with revenue for the year declining by 4.4% to £679.3m.
The group’s freehold and long-leasehold property portfolio has been valued by Savills at the year end at £148.2, compared with the carrying value of £110.9m.
The Restaurant Group said that in 2018 it expected to open between 16 and 20 sites mostly within its pubs and concessions business, with associated capital expenditure of £24m to £30m.
Chairman Debbie Hewit said: “The board continues to ensure that we have a rigorous and disciplined approach to the allocation of capital, and that the group’s brand and location strategy are robust.
“As a consequence, we have taken action to close underperforming sites that we do not believe are capable of generating adequate returns.”
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