Oriental issues profits warning

Oriental Restaurant Group warned today that it will not make as much money as expected this financial year, but it is optimistic that profits will increase next year.

The company reported "satisfactory" trading over Christmas but said like-for-like sales, excluding its Pacific Oriental restaurant in the City of London, were down 0.5% in the nine months to 31 December 1999.

A trading statement read: "Pacific Oriental continues to incur losses but remedial action taken will have a positive impact in 2000."

The group wants to have eight Yellow River Cafés open by the end of the next financial year.

Its first, which opened in Chiswick, west London, in November, is reported to be trading well above expectations.

Oriental said its central production kitchen, operating since July, would play a fundamental role in its expansion plans but would continue to have an adverse impact on profits "until the benefits of scale are realised following the opening of additional Yellow River Cafés."

A second Yellow River Café will open in Twickenham, south-west London, next month and a third in Islington, north London, by early summer.