The proprietor of the Wagamama eating chain has raised its annual revenue expectations regardless of struggling a continued drag on the enterprise from manufacturers together with Frankie and Benny’s.
The Restaurant Group, which has 400 UK websites, reported a ten% rise in income over the half-year to 2 July of £467.4m.
It drove a 15% rise in adjusted core revenue to £36.3m, the corporate stated, including that buying and selling because the finish of the interval had continued to enhance.
It credited its Wagamama shops and Brunning & Price pubs for driving the expansion, with airport-based concessions having fun with a like-for-like gross sales leap of 29% over the 12 months to this point.
Its leisure enterprise, comprising Frankie & Benny’s and Chiquito eating places, endured a 2% decline by the identical measure.
The arm, the corporate defined, was nonetheless affected by the results of weakened demand as a consequence of value of dwelling challenges amongst its core buyer base.
However, the Restaurant Group pointed to indicators of extra resilient buying and selling over the previous few weeks – aided by “a strong recent cinema slate”.
It has diminished the scale of its leisure buying and selling property and anticipated to have 76 websites on the finish of its monetary 12 months in comparison with the 116 operated on the finish of final winter.
While saying that it now anticipated annual adjusted core income to be increased, it didn’t present a variety.
An organization-compiled consensus stated analysts, on common, anticipated a determine of about £77.5m.
The Restaurant Group added that the outlook for prices over the medium time period continued to enhance.
Hospitality has been hammered by a tide of rising prices because the financial system reopened from COVID restrictions, with Russia’s conflict in Ukraine including to the payments and stress on companies to cross on these energy-driven will increase.
The wrestle has been exacerbated by the identical elements affecting wider client payments, with the price of dwelling disaster evolving this 12 months to incorporate extra hits from increased mortgage and rental prices as rates of interest have gone as much as sort out the tempo of worth will increase.
There is proof to counsel that client spending is holding up regardless of the gloomy outlook for the broader financial system.
Recent information has proven a restoration for retail gross sales after a climate hit in July.
Restaurant Group shares have been up 3% on the open.
Its chief government, Andy Hornby, instructed buyers: “We are encouraged by the significant progress made in the first eight months of the year, delivering strong LFL sales growth despite the consumer backdrop.”