Inflation may be squeezing consumers' spending power, but it hasn't dampened demand for pizza and Greek food. Fulham Shore (FUL), owner of the Franco Manca and The Real Greek restaurant brands, opened 16 new restaurants in the UK during the financial year, while eight more openings and a new franchise in Spain post year-end has brought the total number of operating locations up to 53. This gave revenues a boost and helped increase operating profits to £1.3m for the year to March, up from £507,000 the year before. The group wants to open around 15 new restaurants in the current financial year, three of which will be The Real Greek and the remaining 12 Franco Manca.
More locations have actually helped curtail rising costs as the group has successfully negotiated a volume discount with suppliers to offset the impact of more expensive, imported ingredients. This meant net margins only slipped 1 per cent to 44 per cent. But group chairman David Page said staffing could be an issue in the future as many are European. As such, the group has started to improve staff benefits to attract the best people, as well as recruit from a wider range of nationalities.
Analysts at Allenby Capital expect pre-tax profits of £1.97m in the year to March 2018, giving EPS of 0.83p, up from £1.14m and 0.66p in FY2017.
| FULHAM SHORE (FUL) | ||||
| ORD PRICE: | 20p | MARKET VALUE: | £114m | |
| TOUCH: | 19.5-20.5p | 12-MONTH HIGH: | 23p | LOW: 16p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 6.8p* | NET DEBT: | 15% | |
| Year to 26 March | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 0.5 | -0.15 | nil | nil |
| 2015 | 8.3 | 0.04 | nil | nil |
| 2016 | 29.3 | 0.42 | nil | nil |
| 2017 | 41.3 | 1.14 | 0.2 | nil |
| % change | +41 | +170 | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| Includes intangible assets of £27.4m, or 4.8p a share | ||||
