TGI Fridays operator sees Q1 sales slide 3%
The board's focus remains on cash flow generation to repay group borrowings, following which there will be an evaluation of shareholder distributions
TGI Fridays operator Hostmore has revealed a 3% drop in like-for-like sales in the 22 weeks ended 4 June 2023, down from a 1% decline in the first 16 weeks of the year.
The group maintains that like-for-like revenue and total revenue for the period remains “broadly consistent” with the revenue performance for the first 16 weeks of the year announced on 28 April.
News of the group’s revenue, which has been adjusted for the variance in the VAT rate on food sales between FY22 and FY23, comes as the cost reduction initiative announced on 28 April and 2 May are said to be benefiting EBITDA.
According to the group, further opportunities for savings are being evaluated and the details thereof will be announced following their implementation.
This comes after the previously announced utilities hedging programme commenced near the end of May 2023.
In line with the revised capital allocation policy announced on 28 April 2023, the board’s focus remains on cash flow generation to repay group borrowings, following which there will be an evaluation of shareholder distributions.
Gavin Manson, chairman of Hostmore, said: “The ongoing loyalty of our guests is welcome. I am extremely grateful to all our colleagues for their continued hard work and commitment, which has resulted in a further improvement in the ‘Guest Opinion Scores’ for TGI Fridays. This is a great cornerstone to build upon.
“With the revision to our capital allocation policy, to prioritise debt repayment and shareholder distributions, I am confident that this will ensure a reduction in net debt and an ongoing improvement in profitability.”
He added: “As previously announced, I step down from the board today to focus on my executive commitment elsewhere. I am delighted that, as previously announced, Stephen Welker will step up to become the chairman and Julie McEwan and Helena Feltham will join the board at the conclusion of the Annual General Meeting later today.
“I am confident that the leadership of the group is in secure hands. I wish everyone at Hostmore every success for the future.”
