Garfunkel’s owner reports drop in sales amid softening market
The Restaurant Group held steady on 2017 pre-tax profit guidance despite weaker revenues.
Garfunkel’s owner The Restaurant Group has reported a fall in sales as a weaker UK dining market took its toll on the business.
The company – which also owns brands including Frankie & Benny’s, Joe’s Kitchen and Chiquito – reported a 3% drop in like-for-like sales in the 52 weeks to December 31, while total sales slumped by 1.8%.
Chief executive Andy McCue said: “In 2017 we made solid progress against our strategic initiatives, resulting in improved volume momentum in our Leisure business, a lower cost base and a more focused growth plan.
“While the market has softened, we continue to benefit from strong cash generation and a healthy balance sheet.”
But The Restaurant Group held steady on 2017 pre-tax profit guidance despite weaker revenues, saying the figure would be in line with current market expectations.
The company also stood ground on its 2018 sales forecasts, as it pushes forward with an efficiency drive that the company said has resulted in a “fundamentally leaner” business.
“Our expectations around our 2018 sales trajectory remain broadly unchanged and reflect both our improving volume momentum and the significant price investments made in the middle of last year, albeit set against the backdrop of a market that has softened,” it said as part of a trading update.
The overhaul has prompted a revamp of its pricing, food quality and marketing over 2017, and pushed the business to focus on expanding its pubs and concessions business, adding that the”pipeline of new site opportunities continues to grow”.
The Restaurant Group – which operates 497 casual dining sites across the UK, as well as a raft of concession sites that tend to run in UK airports – said it would provide “a more detailed update” on its progress as part of its preliminary results in March.