Chief executive Andy McCue says these results are a sign that the recovery at Restaurant Group (RTN) is going to plan. Pre-tax profit rebounded from a loss last year, and while like-for-like sales fell, this was an anticipated consequence of reducing menu prices and offering deals to win back customers. This strategy appears to be working: the volume of customers actually improved. The adjusted operating margin also contracted from 11.1 per cent to 8.6 per cent as a result of the lower prices, but Mr McCue expects margins to recover during the second half.
The goal to deliver £10m-worth of cost savings was also ticked off ahead of schedule, leaving Mr McCue to focus on regaining lost customers with value-based menu options and a wider range of choice, including more healthy options and desserts. The group is also working with delivery services like Deliveroo and Uber Eats as customers increasingly demand these 'dine-in' options.
Analysts at Numis expect pre-tax profit of £55.9m during 2018, giving EPS of 22p, compared with £56.7m and 22.3p in 2017.
| RESTAURANT GROUP (RTN) | ||||
| ORD PRICE: | 263p | MARKET VALUE: | £528m | |
| TOUCH: | 262.6-263p | 12-MONTH HIGH: | 387p | LOW: 229p |
| DIVIDEND YIELD: | 6.6% | PE RATIO: | 16 | |
| NET ASSET VALUE: | 100p | NET DEBT: | 11% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 580 | 72.7 | 28.0 | 14.0 |
| 2014 | 635 | 84.9 | 33.4 | 15.4 |
| 2015 | 685 | 86.8 | 34.6 | 17.4 |
| 2016 | 711 | -49.3 | -24.0 | 17.4 |
| 2017 | 679 | 43.6 | 16.4 | 17.4 |
| % change | -4 | - | - | - |
| Ex-div: | 7 Jun | |||
| Payment: | 5 Jul |
