LEGAL | Staff Reporter, UK

Fulham Shore's EBITDA is below market expectations

It cited trade in suburban London restaurants which are serving fewer customers than last year with higher operating costs.

The Fulham Shore's current financial year ends on 25 March 2018 and the results for 2018 will be announced in mid-July.

The Company expects to report an increase in turnover and Headline EBITDA for the year ending 25 March 2018 over the last financial year ended 26 March 2017. Whilst turnover for the year ending 25 March 2018 will be broadly in line with market expectations, our Headline EBITDA will, however, be below market expectations. This is primarily due to trade in our suburban London restaurants which, whilst they are still busy, are serving fewer customers than last year with higher operating costs.

In a release, Fulham Shore said, "We have opened 13 new restaurants in the financial year to 25 March 2018, taking the number of restaurants operating at the year end to 41 Franco Manca pizzerias in the UK, 1 Franco Manca pizzeria franchised in Italy and 16 The Real Greek restaurants. We are currently building a new Franco Manca pizzeria in Bath and we have exchanged contracts on a site for later in the year on South St Andrew Street, Edinburgh."

We are operating in an uncertain economic outlook for both the UK and the restaurant sector in particular. As a consequence, we will bring forward our plans only to fund new restaurant openings from our internally generated free cash flow by reducing the number of new restaurant openings for the coming year. We will also choose those locations that we believe will give us above average returns and sensible property deals."

"We continue to offer freshly prepared food at great prices which, we feel, has led to our continuing profitability. All of our cash generated is reinvested back into the business. With this policy we keep our prices low and create jobs in new restaurants. Many of our employees are shareholders, creating a 'super family' of investors. In addition, our restaurant sites have been chosen with care and we have avoided property leases with excess space or particularly high rents. This affordable menu position is where we believe we should be placed within the restaurant sector. We believe that this, along with a prudent opening plan, puts us in a good position when the UK economic environment improves," the release concluded.

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