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The Restaurant Group has welcomed a period of strong trading in the first half of the year, with sales at Wagamama and its Pubs division up by 5% and 9%, respectively.
Wagamama continued to trade strongly in the period, with outperformance of the market in Q2, and like-for-like sales up 21% in Q3 to-date. Dine-in covers were also in year-on-year growth.
Recent openings at Wagamama have also been trading ahead of expectations, and the Restaurant Group board said it was “confident” that its expansion plan will continue to deliver “highly attractive returns” for shareholders.
Meanwhile, Brunning and Price Pubs delivered “another exceptional trading performance” in the first half of the year, with dine-in covers also in year-on-year growth.
Despite the group’s Leisure business being the most impacted by the current cost-of-living pressures, with sales in the period down by 4%, it noted that good progress has been made on further improving its cash generation, with costs well-managed through operational efficiencies and an estate rationalisation plan.
As part of the Leisure estate rationalisation plan, which has progressed ahead of expectations, the group will have closed approximately 35 sites by the end of this financial year, including eight freehold sites.
Concessions performed best overall in the period, with year-to-date sales soaring 28%. Trading in the division has strengthened even further in recent weeks, benefitting from the rapid recovery of passenger volumes and strong operational delivery.
The strength of the Concessions performance was further illustrated by comparing trading against pre-Covid levels, with LFL sales versus 2019 up 3% in Q1, up 10% in Q2 and up 15% in Q3.
The group also gave an update on its medium-term strategy, which targets “significant” EBITDA margin accretion over the next three years, noting it had made an “excellent start” in executing the plan.
The group said this includes its strong LFL trading performance in the first half of the year, its incremental cost savings of £5m, and the acceleration of both new Wagamama openings and the rationalisation of its Leisure estate.
Looking ahead, the group said it is confident in delivering management’s expectations for FY23 in light of the “very encouraging” trading performance in the first half of the year.
