Fulham Shore H1 trading in line with management expectations, strategic expansion of the Franco Manca brand into retail
01 November 2022
Fulham Shore, the owner and operator of the Franco Manca and The Real Greek restaurant brands, has issued an update on trading during the six months to 25 September 2022, and announces the strategic expansion of the Group's Franco Manca pizza business into retail stores nationwide.
Strategic expansion
The Group has launched its debut range of five premium Franco Manca Chef's Selection cook-at-home pizzas. The range has been developed through a licensing partnership with the fine Italian food business Rondanini and is available to purchase in over 500 supermarkets across the UK from this week. The Group has the opportunity to expand into more stores (additional to the current 500) over the coming year, and to partner with further grocery retailers from late 2023.
The range has been created by Franco Manca Executive Chef Alfonso Marseglia. To recreate an authentic at-home experience, all pizzas are made with ingredients of the same high quality and are inspired by the daily 'pizzaiolo specials' available at Franco Manca restaurants.
Fulham Shore's expansion into retail operations complements its portfolio of restaurants, will drive brand awareness and enable the Group to introduce the Franco Manca brand to consumers throughout UK, especially where Franco Manca does not yet have a restaurant presence.
New openings
Since its update published on 31 August 2022, the Group has opened four Franco Manca pizzeria in Lincoln, Hove, Chichester and Cardiff, and two The Real Greek restaurants in Gloucester Quays and Solihull. These new locations have all been busy from the outset. These openings take the total number of restaurants operated by the Group to 95.
The first The Real Greek in Scotland, located in the successful new shopping scheme St James Quarter, Edinburgh, is also being fitted out ready for a December opening.
Trading update
During the six months to the end of September, in spite of challenging political and macroeconomic circumstances as well as recent sporadic train and tube disruptions, the Group traded in line with management expectations. This performance was driven by the popularity of both Franco Manca and The Real Greek's excellent value-for-money propositions.
As a result, Group revenues for the Period grew approximately 35% when compared with the same period in 2019 prior to the onset of Covid-19, and some 25% ahead when compared with the same period to September 2021.
The Company's net cash position before lease liabilities recognised under IFRS 16 as at 26 September 2022 was over £2.6m. The Group has undrawn bank facilities of £16.9m, providing substantial financial headroom of over £19.5m.
As previously stated, the Group plans to publish its Interim Results and an update on trading in December 2022.
Outlook
Macroeconomic challenges including inflation, rising interest rates and political uncertainty continue to affect consumer confidence and, combined with input cost inflation, are presenting trading conditions that are more unstable and unpredictable than at any time in recent memory. These rising costs and what, if any, relevant government support leads to a lack of transparency for short term trading.
As previously stated, Fulham Shore plans to open around 18 restaurants during the 12 months to 26 March 2023.
The Group will review on an ongoing basis its opening target for the 2024 financial year based on the ever-evolving economic and political outlook, and will share subsequent updates as appropriate.
David Page, Fulham Shore Executive Chairman, commented: "After many months of careful development we are thrilled to launch our debut range of Franco Manca cook-at-home sourdough pizzas which are now available in over 500 supermarkets. This is a very exciting new strategic development for Franco Manca and The Fulham Shore, which complements the appeal and success of our consistently busy and growing portfolio of restaurants, and we are looking forward to seeing it develop.
We're delighted that underpinned by the relevance of our Franco Manca and The Real Greek brands and their value-for-money propositions, both our established and new restaurants performed well during the first half of the Group's financial year. This has led the Group to trade in line with management expectations and represents revenue growth of over 35% compared with the same period in 2019 and some 25% ahead when compared with the same period to September 2021."
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