logo-loader

Restaurant Group cuts 2020 forecasts over coronavirus woes

Last updated: 08:58 18 Mar 2020 GMT, First published: 08:02 18 Mar 2020 GMT

Restaurant Group PLC - Restaurant Group cuts 2020 forecasts over coronavirus woes

Restaurant Group PLC (LON:RTN) has cut forecasts for the current financial year as venues are temporarily shut or lose customers.

In the year to 27 December, adjusted earnings are expected to be £95-105mln, down from £137mln posted in 2019.

READ: Cineworld RBC's top pick after coronavirus audit; Restaurant Group at risk

The Frankie & Benny’s owner said like-for-like (LFL) sales dropped 12% in the last two weeks alone, especially in its concessions business in airports, which were down 22% due to travel bans.

LFL sales are estimated to tank 25%, assuming they will be down 45% and 5% in the first and second half respectively.

Airport venues are expected to take the hardest hit, with declines of 92% and 31% in the quarter to June and the full year respectively.

The leisure, pubs and Wagamama divisions are forecast to plunge 68% in the second quarter and normalise in the second half.

The FTSE 250-listed chain has reduced capital expenditure to “at least” £35mln from £75mln and is looking to save £45mln by “delivering maximum operational efficiency”.

Management said fixed rents will halve since many of them are based on turnover, while they expect benefits from the business holidays for three quarters of 2020 following the government's new emergency measures package.

Shares slipped 5% to 24.19p on Wednesday morning.

--Adds shares--

FTSE rises ahead of Easter weekend, JD Sport gains on upbeat outlook -...

The FTSE 100 gained on the final morning of this shortened Easter trading week. Festive cheer was limited though, as Thames Water confirmed shareholders would not provide it with a £500 million rescue package, prompting speculation over the London supplier’s future. On a more positive...

20 minutes ago