Restaurants

The Restaurant Group to raise £715m to offset Covid-19 impact

The plans follow the company’s recently announced full year trading update which saw it hit a pre-tax loss of £127.6m for 2020 compared with its £37.3m loss in 2019

The Restaurant Group (TGR) has announced it plans to raise £175m in a move which will aim to enhance liquidity, accelerate deleveraging and support selective growth as the company continues to struggle with the ripple effects of Covid-19.

The plans mark the end of the group’s “deep restructuring” programme and refinancing of its long-term debt facilities.

The net proceeds of the capital raise will be used to improve TRG’s liquidity headroom to protect against “any potential resurgence” of the Covid-19 pandemic.

The capital raised will also be used to strengthen TRG’s “flexibility” to capitalise on selective site expansion in its Wagamama (UK restaurants, UK delivery kitchens) and pubs businesses which displayed profitable opportunities.

The plans come after the group revealed a pre-tax loss of £127.6m for 2020, up from a £37.3m loss in 2019.

Total revenue dropped 57% to £459.7m for 2020 compared with £1.1m the previous year as lockdown restrictions continued to affect trading.

Last year, the group confirmed its plans to reduce its current portfolio and restructure its organisation by axing 125 sites, as well as seeking improved rental terms on 85 sites within its remaining trading estate.

Andy Hornby, CEO, said: “The Covid-19 pandemic has presented enormous challenges for our sector but the TRG team has responded decisively to restructure our business whilst preserving the maximum number of long term roles for our colleagues.

“The Capital raise announced today, alongside the debt refinancing announced last week, represents the last important step in our restructuring process and provides TRG with the long term flexibility to invest in growing our business.”

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