A strong first quarter performance buoyed first-half trading at restaurant chain Prezzo (PRZ). Indeed, in the six months to end-June robust revenue growth helped adjusted pre-tax profit - which excludes a £1m one-off charge - to grow 16 per cent to £9.8m.
Another round of new site openings helped to support that growth profile. Nine new restaurants opened in the period - seven under the Prezzo brand and two Chimichanga restaurants - while two sites closed. By the end of the half, this left 244 trading restaurants and one further site was opened after the period ended. The group actually opened its 200th Prezzo site this year, in York, and management plans to open a further 25 new restaurants during 2014. New sites in Newcastle, Telford and Newquay are due in the second half.
While first-quarter trading was robust, management admits that growth has been more moderate since. It says full-year figures will still meet market expectations, but that future investment will be necessary to support the enlarged business. Delivering ongoing growth hinges on cutting the use of vouchers and emphasising the restaurant's loyalty scheme.
Broker Numis Securities has upgraded its full-year forecasts by just under 3 per cent and now expects pre-tax profit for 2014 of £23m for 2014, giving EPS of 7.6p (from £20.4m and 6.9p in 2013).
| PREZZO (PRZ) | ||||
|---|---|---|---|---|
| ORD PRICE: | 138p | MARKET VALUE: | £324m | |
| TOUCH: | 138-141p | 12-MONTH HIGH: | 165p | LOW: 113p |
| DIVIDEND YIELD: | 0.2% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 49p | NET CASH: | £7.5m | |
| Half-year to 29 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 79.7 | 8.2 | 2.7 | nil |
| 2014 | 92.3 | 8.8 | 2.8 | nil |
| % change | +16 | +7 | +6 | - |
Ex-div: - Payment: - | ||||
