The Restaurant Group is putting a tough 2016 behind it, as its “transitional” year gets going.
The owner of Frankie & Benny’s said total like-for-like sales fell by 1.8 per cent in the first quarter ending 21 May.
Total sales at the restaurant and pub group also dropped by 1.5 per cent.
The group’s 2016 full-year dividend will be 17.4p a share.
The FTSE 250 firm's share price rose 10.3 per cent at 350.1p in morning trading, after the trading update showed recent declines weren't quite as bad as some had expected.
Why it’s interesting
Pub-goers and sunny weather are helping The Restaurant Group to bounce back after a challenging year which saw a new chief executive, former Paddy Power boss Andy McCue, step in to take the helm.
While the company said those trends will fade somewhat, shares rose 10 per cent in this morning’s trading; the Restaurant Group’s turnaround plan announced just two months ago could be giving investors cause for further confidence.
Despite the recent departure of CFO Barry Gardiner and a drop in sales, chairman Debbie Hewitt was optimistic and said the new strategy is “progressing well as we make the required investments in price, marketing and our offer”.
After dropping its prices and a menu rethink, the first few months of the year are a positive sign for the group, as momentum is expected to continue building into the latter half of the year.
Hewitt also revealed the firm, which operates 491 restaurants and pubs around the UK, will deliver profit for the year in line with current market expectations.
What the company said
Debbie Hewitt, chairman of the Restaurant Group, said:
2017 is a transitional year.
We continue to address the competitiveness of our leisure businesses and are focused on achieving a sustainable volume-led turnaround.
Where opportunities to accelerate our progress present themselves, we will invest appropriately.
The Restaurant Group has had a taste of revival and is looking to serve up more, as its turnaround strategy starts to get underway.