Loungers PLC (AIM:LGRS), the owner of Cosy Club and Lounge, continued to flex its operational strength in the first half despite industry headwinds and is poised to continue its impressive expansion drive.
The hospitality company opened 16 new sites in the 24 weeks to 1 October and is expected to open a further 35 before the end of the financial year, bringing the group’s total estate to 256.
Nick Collins, chief executive officer of Loungers, said in a trading update: “The opening of every new Lounge means an investment of nearly £1 million into the local high street, and the increased footfall creates a positive knock-on effect on all of the businesses around us.”
Inflationary pressures continue to ease, helping margins widen, and Loungers is confident this tailwind will allow for a strong festive period.
In the 32 weeks to 26 November, revenues jumped 7.6%, supported by enhancements to the company's menus, which saw the introduction of blended and iced coffee drinks.
In the first half, revenues jumped 7.7% on a like-for-like basis to reach £150 million.
Underlying profits rose 23% to £23.9 million as the group saw margins edge closer to pre-Covid levels.
Gregor Grant, the group's chief financial officer, is set to step down from his role at the end of the 2024 financial year in April, Loungers added in a separate statement. A search is now underway to find a successor for Grant.
Shares in Loungers are down 1.7% on Tuesday morning, having opened at 233p.