Srankie & Benny’s owner in spotlight

The struggling owner of Frankie & Benny’s is expected to report another fall in profits to the City this week as chief executive Andy McCue outlines the progress of turnaround efforts.

A consensus of analysts forecast that half-year pre-tax profit at the Restaurant Group will fall more than 30% to £25.2 million as warm June weather and poor cinema attendance look set to have dented footfall.

Because of their locations in many shopping centres and out of town retail parks, sales at the group’s restaurants – which also include Garfunkel’s and Chiquito – are closely aligned to cinema attendance.

Tim Barrett, analyst at Numis, said: “A weak film slate and record June weather were unfavourable for cinema attendance, meaning it seems reasonable to expect a small, temporary moderation in footfall.”

In its last trading update, the Restaurant Group said like-forlike sales fell 1.8% in the 20 weeks to May 21, with total sales declining 1.5%.

However, the figures marked an improvement on the fourth quarter, which saw like-for-like sales drop 5.9%.

For the half year, Numis is pencilling in a 2.5% dip in sales, with the performance of the firm’s pubs business likely to have been boosted by the warm weather and mitigating a decline in restaurants.

As part of Mr McCue’s turnaround, the company has been closing under-performing restaurants and rejigging its menus in a bid to re-engage with its audience.

It comes after the Restaurant Group admitted it had lost value-conscious customers at Frankie & Benny’s after significant price hikes, with the firm pledging to “look at the pricing architecture of the menu” and “reinvigorate the value offer” in a bid to attract more families to its outlets.

Restaurant Group operates Frankie & Benny’s.