viewRestaurant Group PLC

UPDATE - Restaurant Group upbeat as consumer incomes turn up


--adds broker comment and updates share price--

Frankie and Benny’s owner Restaurant Group (LON:RTN) expects more families to dine out this year thanks to a stream of new movie blockbusters and higher consumer income.

“After 5 years of decline, we are now starting to see increasing real incomes, a trend which is expected to become more strongly established during the course of 2015,” said chief executive Danny Breithaupt.

He added that Christmas trading was strong with like-for-like sales 5% higher over the two weeks to 4 January.

The firm, which also owns Mexican food chain Chiquitos, gets roughly half of its sales from restaurants next to cinemas.

Although 2014 was a weak year for cinema admissions, a stronger film release schedule in 2015, which includes the next in the Star Wars series, should see more families eat out on their trips to the flicks.

In a statement today the business, which also runs Garfunkel’s, said sales rose 2.8% last year, adding the outlook for 2015 is "very positive".

The firm, which opened 40 new restaurants in 2014, said full year results are expected to be within the range of market forecasts.

Broker N+1 Singer predicts the firm will post  8% earnings per share growth in its 2014 full-year results, which it described as good in light of a weak cinema market in 2014 and the World Cup, but not quite the double-digit anticipated earlier in the year.

The firm maintained its hold rating with a target price of 700p. 

Shares added 14p to 699p.

Quick facts: Restaurant Group PLC

Price: 51.45 GBX

Market: LSE
Market Cap: £303.45 m

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