Loungers sales rise amid focus on expansion

Dining brand operator Loungers has reported like-for-like sales growth of 7.4% for its full year in a trading update on Tuesday, with a 17.6% increase compared to pre-pandemic levels on a three-year basis.

The AIM-traded firm said it reached a total revenue record of £283.5m for the 52 weeks ended 16 April, marking a 19.5% increase compared to the previous year.

During the year, the group opened 29 new sites, comprising 24 Lounges, four Cosy Clubs and its first roadside site under the new Brightside brand.

The acquisition of three freehold sites for a total of £3.9m and the acceleration of its site roll-out programme contributed to year-end net debt of £6.2m, widening from underlying net debt of £2.6m in April last year.

Its board said the group's sales performance demonstrated the “relevance and resilience” of its brands, adding that it expected EBITDA for the 2023 financial year to be in line with market expectations.

“We have once again delivered a truly stand-out performance over the year,” said chief executive officer Nick Collins.

“Our sales have been exceptional with the mature estate trading 18% ahead of pre-pandemic levels and 7% ahead of what was a really strong performance last year.

“We have progressed well with our accelerated site roll-out programme, opening 29 sites during the year which as a cohort are trading well above average.”

Collins said the property market was working in the firm’s favour, describing its pipeline of around 35 sites for the 2024 financial year as “incredibly exciting”, with nine openings planned for the first quarter.

“The first site of our new roadside concept, Brightside, has opened well, and we look forward to opening the next two Brightside sites in the summer.

“For almost a decade now we have consistently out-performed the market as we strive to deliver better for our customers and our teams.

“The inflationary pressure across our supply chain looks to be easing, and our scale and continued growth have allowed us to mitigate much of the impact.”

Loungers said it was planning to announce its preliminary results for the year ended 16 April on 12 July.

At 0814 BST, shares in Loungers were down 0.97% at 204p.

Reporting by Josh White for Sharecast.com.