Loungers PLC (LON:LGRS) sees potential to grow its 161-strong estate to over 500 locations across England and Wales over the next decade.
Opening new sites at a rate of 25 per year, the café-bar operator said it is on track to meet its full-year target, with five launches in the past two months on top of the 10 in the first half.
READ: Loungers growing at more than leisurely pace as roll-out continues
The company, which floated on AIM in April, said it is outperforming the sector thanks to its “unique” trading model that combines elements of coffee shop, pub and restaurant in a “relaxed home from home ambience”.
Revenue rose 18% to £79.8mln in the six months ended 6 October and reported pre-tax losses shrank 41% to £2.4mln.
Offering investors a range of alternative profit measures, Loungers said adjusted PBT, which excludes £3.7mln of one-off costs from the IPO and a £1.5mln exceptional write off of loan arrangement fees, swung to a positive £2.6mln from a £4.3mln loss a year ago.
Then there was the adjusted underlying profit measure (EBITDA), which increased by 20% to £14.6mln, helped by the exclusion of IPO costs as well as £1.2mln of site pre-opening costs and £7.4mln of asset depreciation.
House broker Peel Hunt upped its full-year adjusted pre-tax profit forecast by 3% to £11.6mln to reflect higher margins.
“We believe new opening trading records have been set, with the company being able to use the enhanced covenant of its PLC status, combined with the retraction of the retail/restaurant sectors, to help it acquire attractive sites,” analysts said in a note.
Shares were up 2% to 202.1p in early trading on Wednesday.
@CorderoLounge's newest customer is pretty cute, don't you think? #Alpaca #LoveLounging pic.twitter.com/c7TwwuObEj
— LOUNGERS (@theLOUNGERS) November 7, 2019