Loungers says it has potential to triple site numbers after surging sales
Cafe-bar operator Loungers has said it sees the potential to more than triple in size after posting surging sales on the back of new restaurant openings.
Loungers, which trades from independently named Lounges and the Cosy Club chain, reported a 22% jump in revenues to £79.8 million for the 24 weeks to October 6.
The company hailed strong organic sales across its sites as like-for-like revenues increased by 5.4% for the period.
Meanwhile, the company narrowed its total loss before tax to £2.5 million from a £4.2 million loss in the same period last year.
Nick Collins, chief executive of the business which floated on the stock market in April, said it has the potential to grow to have around 500 sites across the UK.
Loungers currently has 161 sites, consisting of 133 Loungers and 28 Cosy Club venues, but Mr Collins said he believes it can continue its rapid expansion to give it “more than 400 Lounges and 100 Cosy Clubs” overall.
The dining chain said it is on track to open 25 sites over the full year after opening 10 new sites over the first six months of the financial year.
Loungers said it has “continued to trade well and outperform the market” in the current period after launching a new winter food menu and updated drinks range.
Mr Collins said: “I am delighted to announce another strong set of results which continue to highlight our consistent outperformance against the market.
“This will be the fifth consecutive year we have opened at least 20 new sites and we remain excited by the prospects and potential for both our Lounge and Cosy Club formats and the significant opportunity we have ahead of us.”
Analysts at Liberum said: “Loungers continues to outperform, delivering the scarce trinity of like-for-like sales growth, unit growth and margin growth.
“The latest menu and drinks refresh has been well received and new supplier terms should provide margin momentum in the second half and beyond despite the well-publicised industry cost headwinds.”