What’s more, excluding the positive impacts of Eat Out to Help Out and the Government’s VAT reduction, like-for-like sales were found to be positive over the nine weeks from 13 July to 13 September.
As previously reported by The Morning Advertiser (The MA), the café-bar operator revealed relatively flat year-on-year July trading across its 165-strong stable despite post-lockdown trading restrictions, with like-for-like sales down just 1.7% year-on-year over the four weeks from 4 July.
While the operator of 167 sites under its Lounge and Cosy Club brands revealed for the 52 weeks to 19 April 2020, revenue rose by 8.8% to £166m and adjusted EBITDA increased by 0.8% to £28.7m, its loss before tax grew by 55% to £14m due largely to Covid-19 related costs.
With only the final eight weeks of its 52-week results period affected by coronavirus, however, Loungers reported like-for-like sales grew by 4.5% in the 44 weeks to 23 February 2020, during which time, it opened 21 new sites.
The group’s latest update also revealed that net debt was slashed to £24m on 6 September having stood at £35m on 19 April.
Confidence in all-day offer
Commenting on the group’s latest results, chief executive Nick Collins said he was delighted with the strength of Loungers’ performance since sites resumed trading post-lockdown, highlighting the positive impact of the Government’s Eat Out to Help Out scheme.
As reported by The MA, Loungers’ phased reopening schedule saw 75 of its Lounges and 19 of its Cosy Clubs reopen by 16 July, with its remaining venues all trading by 5 August.
“Our like-for-like sales of [up] 30% over the last 10 weeks includes the remarkable four weeks of the ‘Eat Out to Help Out’ scheme and the Government’s support for our sector continues to be much appreciated,” Collins said. “More importantly, however, having fully re-opened our underlying sales are in growth even without this support.
“We have focused on providing amazing hospitality, whilst reassuring our teams and customers the Lounges and Cosy Clubs are a safe environment, and our customers have been quick to return.
“During lockdown, we were confident the flexibility of our all-day offer, our suburban and market-town locations and our focus on hospitality and community would ensure we emerged strongly. I believe these results have confirmed that to be the case.”
Roll-out to resume
Looking ahead to the coming months, Collins added that neither he, nor the rest of the group, knows exactly what lies in store for the hospitality sector.
“We anticipate further interruption to trade on either a local or regional basis in the short-term and have the balance sheet and liquidity to withstand significant further Covid impacts,” he continued.
“Covid has, however, strengthened our belief in the potential scale of both brands in the longer-term and the behavioural shifts being witnessed further underline this.
“In the second half of the year we will cautiously re-start the roll-out and we are excited about the property opportunities available to us and getting back to opening 25 sites a year in due course.
“I would like to thank our team across the UK for their extraordinary contribution over the last six months. It has been an immensely challenging period and their determination and hard-work have allowed us to not just get through it, but to emerge a better business.”