Loungers targets record number of openings

13-Oct-2023 - Last updated on 13-Oct-2023 at 08:46 GMT

Positive update: Armado Lounge in Plymouth

Loungers CEO Nick Collins has cited the “continued evolution” of the business as key to its sales growth in a trading update for the 24 weeks ended 1 October 2023.

Loungers, which operates 201 Lounge café-bars and 35 Cosy Club bar-restaurants along with its roadside dining concept Brightside, said there has been an acceleration in like-for-like (lfl) sales growth and 16 new sites opened during the period.

The group has delivered lfl sales growth of 7.7% over the 24 weeks to 1 October 2023. It said this represents an acceleration from the lfl sales growth of 5.7% previously reported for the 12 weeks to 9 July 2023 and reflects a continuation of its strong lfl sales performance since the pandemic.

Relative to the 24 weeks ended 6 October 2019, lfl sales have risen by 25%. The group said it was pleased to have delivered total revenue for the first half of its 2024 financial year of £149.6m, up 22.3% on the previous year (H1 FY23: £122.3m).

16 new openings

Loungers added inflationary pressures continue to diminish in line with its expectations.

Its balance sheet “remains strong” with non-property net debt at 1 October 2023 of £14.3m (2 October 2022: £9.5m), reflecting the timing of September month end working capital cash outflows.

The group has opened 16 new sites during the period versus 11 in the same period last year, taking the portfolio to 238 sites as at 1 October 2023. One Lounge site has been opened to date in the second half and, with a further 17 sites scheduled to open, the business expects to open a total of 34 new sites in the current financial year, which would be a record number.

Great pipeline

Nick Collins, CEO, said: “I am delighted with our strong trading performance across both the mature estate and our new openings.

“Our consistent sales growth reflects the continued evolution of our offer and the resilience of the UK consumer and high street.

“We have now opened 34 sites in the past 12 months, creating around 1,000 jobs in the process, and 72 sites since the last Covid lockdown.

“With a great pipeline of further openings in front of us I have never felt more optimistic about our prospects. None of this would be possible without our amazing team, and as ever I would like to say a massive thank you to them for their hard work.”