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Record profits for Restaurant Group

15 September 2004
Record profits for Restaurant Group

The Restaurant Group, operator of chains including Garfunkel's and Frankie & Benny's, has reported record profits for the six months to 30 June.

Pre-tax profit rose by 40% to £9.8m before exceptional items, while sales were up by 10% to £118m.

Chairman Alan Jackson said: "Profits increased across all parts of our business and a strong start to the second half gives me confidence that we will have another successful year of progress."

The group said like-for-like sales for its main brands during the period were up by 3.7%.

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Caffe Uno: sales were down
Its leisure parks division - restaurants mainly sited alongside multiplex cinemas - saw sales increase by 17% to £57.5m, while profits rose by 26% to £11.1m. At the 92 Frankie & Benny's outlets, sales came in at £44.7m, with like-for-likes increasing by 6.7%. Profits increased by a quarter. Six new Frankie & Benny's opened during the six months and up to 10 more are planned for the second half of the year. Chiquito, the 24-strong Mexican restaurant chain, saw like-for-like sales increase by 2.8%. Turnover was £12.8m. A new management team, put in place in mid-2003, has been stabilising and rebuilding the business. Eight branches have been redesigned with a "softer, more contemporary" design and this programme will continue for the rest of the year. "We are particularly pleased with the turnaround in Chiquito's performance," the company said. Within the group's concessions business - mainly operating at UK airports - total turnover increased by 18% to £21.1m. Like-for-like sales were up by 7.9% and profit by 7.4%, largely thanks to increasing passenger numbers. Five new units opened recently at London's Gatwick airport, including a juice bar, a sushi offering and a sandwich bar, along with a full-service Garfunkel's restaurant. The company said its concessions business might in future involve operating more franchised units from third parties. It already runs two O'Neills bars, a Yo! Sushi and an Eat sandwich bar under franchise. In high-street restaurants, like-for-like sales remained static. They made a profit of £5.4m on sales of £39.4m. At the 30-strong Garfunkel's chain, sales came in at £12m with like-for-likes up by 4.5%, thanks to the increase in tourist numbers. A "refreshed" format is being trialled at two London restaurants. Caffe Uno did not fare so well. Like-for-like sales were down by 0.7% and total turnover was £18.9m. But profits increased thanks to improved cost controls. There are 60 restaurants in the chain. Est Est Est was the worst performer. Like-for-likes fell by 3.9% at the 19 sites. Turnover was £8.6m. The brand has now been placed under the control of board director Trish Corzine. "We expect to stabilise and turn around the performance of this business," the company said. Buy this week's *Caterer* magazine for more industry news and analysis
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