Site most at risk are at airports with “considerably weak” footfall.
The Restaurant Group (TRG) which also operates noodle and sushi chain Wagamama has indicated that at least 10 per cent of its restaurants (many at airports) will not reopen until 2021 at the earliest.
In a press realise, TRG – which also owns Frankie & Benny’s, and Garfunkels – announced that it had accessed GBP 50m from the Government Coronavirus Large Business Interruption Loan Scheme (CLBILS scheme) supported by Lloyds Banking Group.
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It added that it expected 90 per cent of all of its sites to be open by the end of September, with the reopening phasing varying by division.
But it said the last 10 per-cent were not expected to reopen in 2020 at all because of “considerably weak” footfall – particularly in its airport locations. Wagamama has sites in Heathrow Airport, Gatwick Airport and Manchester Airport.
TRG aquired Wagamama for GBP 559m in October 2018.
In September 2019, the FT reported that the TRG had plans to close more than 150 outlets in an effort to rejuvenate its business after posting an GBP 87.7 million pre-tax loss for the first half of the year.
This year, Wagamama said its UK sales and earnings fell in its first quarter. UK turnover decreased 1.2 per cent to GBP 80.3 million due to with Covid-19 impacts. Furthermore, it also took a GBP 4.5 million charge in its first quarter, including costs of the coronavirus crisis.
The Evening Standard criticised TRG’s chief executive Andy Hornby, saying that he’s “got a nerve”.
Hornby was chief executive of Halifax Bank of Scotland in the financial crisis, and was partly blamed for bank HBOS’s downfall. A report by the Parliamentary Commission on Banking Standards found that Hornby was ‘unable or unwilling to change course’ at HBOS after his predecessor Sir James Crosby set the bank on the road to ‘disaster’.
Joining TRG as CEO in 2019, it was the first time he lead a publicly listed company since HBOS.
“Today, Hornby admitted he’ll not be reopening 10 per cent of his restaurants in 2020. For which read, “ever”,” wrote the Standard.