Managing director Alex Reilley told the Publican’s Morning Advertiser’s sister title M&C Report that around 20% of the company’s openings will be under the Cosy Club format, which is expected to reach double figures by mid-2015. The seventh Cosy Club opened in Bristol last week.
“We’ve got a list of 70-odd locations for Cosy Club,” Reilley said. “I think that’s probably quite a conservative number.”
Major metropolitan cities as well as smaller cities and towns are targeted, with Reilley pointing out that the concept has worked in major cities such as Bristol, Cardiff and Bath as well as smaller locations like Salisbury and Stamford, which has a population of 25,000.
“It demonstrates that we don’t rely on a certain minimum population requirement that certain other brands do,” he said. “We see a lot of market town opportunities.”
Targets
He said there are about a dozen towns that could have either a Lounge or a Cosy Club, and he said both brands can work in close proximity as they have a differentiated offer. Opening a Lounge is generally a quicker process, he said.
Announcing a 52% rise in earnings before interest, tax, depreciation and amortization (EBITDA) before central overheads to £6.7m in the year to 27 April, Loungers said the group remains firmly on track to reach 56 sites by the end of 2014, with deals already in place for up to half of the 20 sites it anticipates opening in 2015.
“In terms of geography, we’re primarily looking at opening sites within the existing parameters where we’ve pitched our tent,” said Reilley. He said a recent opening in Chippenham took the equivalent of its entire annual rent in just five days, while the opening in Gloucester “paid for itself in 10 months”.
Like-for-like sales in the year to 27 April grew 5.1%. Turnover rose 52.3% to £33.7m with company EBITDA (before exceptional and pre-opening costs) increasing from £2.9m to £4.4m. It invested £6.9m opening 12 sites in the period.