Fulham Shore PLC (LON:FUL) reported a swing to half-year losses as all its restaurants were closed to dine-in customers for more than half the period because of coronavirus lockdowns.
As at December 16, the majority of its Franco Manca pizza chain and The Real Greek restaurants are closed to dine-in customers as London entered Tier 3 restrictions, with Surrey and Berkshire entering Tier 3 restrictions from the weekend.
For the six months ended September 27, 2020, revenue fell 45% to £19.9mln and resulted in a loss after tax of £3.9mln compared to a £0.4mln profit a year earlier.
But with an operating cash inflow of £6.3ln and positive underlying earnings (EBITDA) of £3.7mln, plus new funds raised from investors and loans from the government CLIBIL scheme, directors are cautiously optimistic.
Chairman David Page said the positive EBITDA performance was driven by the ability of the Franco Manca and Real Greek teams “to adapt quickly to the continuing changes implemented by the UK government in their response to COVID-19”, with a positive customer response to the launch of "Meal at Home" kits and new e-gift cards.
“The ongoing damage to the property and restaurant sectors will allow us to prospect for new sites at much reduced rents and lower capital costs per site,” Page said.
“As such, over the next few years and once normal trading conditions return, we will target a higher return on capital than we have historically achieved.”
One new Franco Manca was opened during the period and another since, both in central London, plus a Real Greek in Bracknell.
As at December 17, the group had net debt of £3.7mln, excluding lease liabilities, with an undrawn debt facility of £11.5mln.
“Despite the near-term uncertainty, the board remains confident in the long-term strength of the group and believes it is well positioned to both deliver strategic growth and capitalise on opportunities as a sense of normality resumes,” Page said.