Loungers PLC (AIM:LGRS) reported a slump in full-year profits but signalled that inflationary pressures are diminishing.
Profits before tax in the 12 months to 16 April 2023 fell by roughly 66% to £7.3mln, while adjusted underlying earnings (EBITDA) slipped 11% to £47.3mln, although these were ahead of pre-pandemic levels in 2019, where the group reported adjusted EBITDA of £28mln and a pre-tax loss of £6.7mln.
Revenues grew to £283.5mln from £237.2mln compared to the 12 months prior, the operator of brands such as Lounge, Cosy Club and Brightside said.
"I am delighted to be announcing another excellent set of results for Loungers. During the year we opened 29 new sites creating around 1,000 new jobs, launched an exciting new roadside dining brand and achieved industry leading LFL sales growth,” said CEO Nick Collins.
According to a statement, inflationary pressures were “mitigated and are now diminishing”, and Loungers’ medium-term goal is now to restore adjusted EBITDA margins to pre-Covid levels.
Looking ahead, the company said it remains positive on outlook, with like-for-like sales up 5.7% in the 12 weeks since the end of the year.
New site openings are also performing well, it said, achieving record levels of sales while the pipeline of new sites is as strong as ever.
“Based on our experience the UK consumer remains positive, inflationary pressures are diminishing and recruitment challenges have eased,” Collins added.