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Wagamama refinances to reduce group debt

23 October 2017 by
Wagamama refinances to reduce group debt

The owner of Japanese style noodle brand Wagamama has refinanced debts in order to reduce the knock-on effect of another year of losses.

In the financial report for the 52 weeks ended 23 April 2017, the group made a pre-tax loss of £8.2m. The refinancing gave the group the funds to repay bond debts of £150m, and a new bond issue of £225m was completed.

The new bond will be used to reduce shareholder debt, which includes £186m of fixed interest loan notes.

Turnover was up 16% to £266m in the period, and EBITDA grew by 17% to £45m.

Wagamama said that pressures on the business included Brexit, which "may well impact our underlying sales" as well as potential food and wage inflation.

Chief financial officer Nick Taylor said: "We have fixed price contracts in place for most of our ingredient and distribution costs for at least the next financial period and in many cases beyond this. It is unclear at this stage what further impact Brexit will have on our labour availability, underlying costs, and our international costs and revenues."

Over the period, the group opened nine restaurants and closed five in the UK. It now operates 124 restaurants in the UK and four in the USA as well as 44 under franchise agreements.

The group plans to open further managed restaurants in the UK and USA.

Simon Cope to join Byron Hamburgers as MD from Wagamama >>

Price competition among foodservice operators set to intensify >>

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