The Restaurant Group
The Restaurant Group which owns Frankie & Benny’s, Wagamama and Chiquito has announced plans to close 90 restaurants by the end of 2021 as part of a restructure which saw 18 restaurants close in 2019. The restructure also saw a number of stores convert to Wagamama's as that is the Restaurant Group's most profitable brand.
Andy Hornby who is the CEO of the Restaurant Group stated the following:
"Having joined the business in August last year I am particularly pleased with the continued and significant progress made following the acquisition of Wagamama and the integration of the business into the Group, which has transformed the Group's growth trajectory and momentum. Our three growth businesses of Wagamama, Concessions and Pubs are all out-performing their respective markets and have clear potential for further growth. I am also acutely aware of the challenges facing our Leisure business and the wider casual dining sector."
The business which has 650 sites in total saw a pre-tax loss of £37.3 million last year, which has been attributed to a number of unprofitable stores. It has been a tough few years for the restaurant industry which has seen other chains fail, namely Jamie’s Italian, Carluccio’s, Gourmet Burger Kitchen, Byron Burger, Gaucho and Prezzo.
Despite the difficulties Wagamama saw profits increase 8.5% last year and Mr Hornby has stated that there will be £45 million investment into four new Brunning & Price Bubs, eight new airport branches (including six at Manchester’s new terminal), four new Wagamama branches in the UK and six conversions of sites to become a Wagamama’s.
As the business continues to restructure to return to profitability it has reported a 5.3% increase in like-for-like sales for the first six weeks of 2020.
Following our post on the 18th February about Laura Ashley seeking funding due to their struggles, it has been confirmed that Wells Fargo has agreed terms on a £20 million loan facility.
Laura Ashley stated that “The group should be able to utilise requisite funds from its working capital facility with Wells Fargo to meet its immediate funding requirements”
The company’s shares improved by 15% to 1.9p following the announcement of receiving the funding but that is still well below the share price of 3.25p before the struggles were announced.
The result of the rescue finance will be a huge relief to the company and its 2,700 employees.