Loungers PLC – Interim Results

Loungers plc (“Loungers” or the “Group”) is pleased to announce its unaudited Interim results for the 24 weeks ended 6 October 2019 (the “period”).  Loungers is an operator of 161 café/bar/restaurants across England and Wales under two distinct but complementary brands, Lounge (133 sites) and Cosy Club (28 sites).  The Group’s sites offer something for everyone regardless of age, demographic or gender and the Group operates successfully in a diverse range of different sites and locations across England and Wales.

 

Financial Highlights

	IFRS 16			IAS 17
	24 weeks ended 6 October 2019 £000	24 weeks ended 7 October 2018 £000	Movement	24 weeks ended 6 October 2019 £000	24 weeks ended 7 October 2018 £000	Movement
Revenue	79,827	65,444	+22.0%	79,827	65,444	+22.0%
Gross profit margin (%)	41.5%	40.6%	+0.9 ppts	41.5%	40.6%	+0.9 ppts
Adjusted EBITDA	14,666	11,681	+25.6%	10,222	8,113	+26.0%
Adjusted EBITDA margin (%)	18.4%	17.8%	+0.5 ppts	12.8%	12.4%	+0.4 ppts
Loss before tax	(2,494)	(4,250)		(1,562)	(3,476)
Adjusted profit / (loss) before tax	2,630	(4,250)		3,562	(3,476)
Adjusted diluted earnings / (losses) per share (p)	2.5	(23.1)		3.4	(19.6)
Net bank debt	29,340	161,979		29,340	161,979

 

 

·      Revenue increased 22.0% to £79.8m (2019: £65.4m)

·      Strong like for like sales growth of 5.4%

·      Gross profit margin 0.9% ahead at 41.5% (2019: 40.6%)

·      Adjusted EBITDA (IFRS 16) of £14.7m, up 25.6% (2019: £11.7m)

·      Adjusted PBT (IFRS 16) of £2.6m (2018: pre-tax loss of £4.3m)

·      Net bank debt at period end of £29.3m reflects capital structure introduced at the time of the IPO

 

Highlights

·      On track to deliver 25 new site openings this financial year and going forward

 

–       Proven ability to open successfully in an increasingly diverse range of town centre and secondary high street locations

–       10 new sites opened in the period and a further 5 sites opened post the half year end

–       Additional 10 new sites scheduled in H2 (eight Lounges and two Cosy Clubs), bringing the Group total to 171

–       New site pipeline remains strong into 2021/22; strategy is to open 25 new sites per annum

–       H1 results further underline the opportunity for our unique, all-day trading model, with its broad nationwide demographic appeal

 

·      Continuous evolution of our customer offer and focus on profit conversion

 

–       New winter food menus and updated drinks ranges launched in October and November, ensuring our offer remains current and at the forefront of industry trends, resonating well with customers

–       Successful renegotiation of the Group’s major food and drink supply contracts

–       Increasing scale continues to deliver operational efficiencies and help drive further margin improvement

 

·      Building a platform for future growth

 

–       Further strengthening of senior management team with Tom Trenchard appointed as Property Director and the development of in-house purchasing talent

–       Evolution of regional operating structure to support our increasing geographic footprint and ambitious growth plans

–       Continued significant investment in systems and process across the Group

 

·      Current trading and outlook

 

–       Continued to trade well and to outperform the market

–       Five new sites opened in H2 to date and on plan to deliver 25 new site openings in the financial year with Lounges in locations such as Sutton, Watford, Sittingbourne and Chorley and Cosy Clubs in Nottingham and Brindley Place, Birmingham

 

 

Nick Collins, Chief Executive Officer of Loungers said: 

 

“I am delighted to announce another strong set of results which continue to highlight our consistent outperformance against the market. This will be the fifth consecutive year we have opened at least 20 new sites and we remain excited by the prospects and potential for both our Lounge and Cosy Club formats and the significant opportunity we have ahead of us.

 

“We have delivered sector leading like for like sales growth of 5.4% alongside a 0.4% improvement in our EBITDA margin.  This has been achieved alongside opening 10 new sites in H1, delivering impressive overall sales growth of 22% and successfully listing the business on AIM.

 

“Looking ahead, the strength of our FY20 openings to date and the continued evolution of our offer further underpins our confidence in continuing our current growth rate of 25 new openings per year and the potential for more than 400 Lounges and 100 Cosy Clubs across the UK.”