Yahoo Finance Loungers to accelerate expansion as it shrugs off cost-of-living pressures
Cafe bar chain Loungers plans to accelerate the opening of new venues as bosses said the company has yet to see any shift in customer demand despite the cost-of-living crisis.
Shares in the hospitality firm lifted higher on Wednesday morning as it posted revenues of £237.3 million for the year to April 17, representing a 203% increase against pandemic-hit trade in the previous year.
As a result, it swung to an operating profit of £28.4 million for the year, compared with a £7.7 million loss in the prior year.
The firm said recent sales have also benefited from its continued expansion, with Loungers opening its 201st location this week.
Loungers has recently opened roughly 25 sites per year and now said it has the capacity to open 32 each year over the next five years.
The company, which also runs the Cosy Club brand, said it believes it has the capacity to grow to around 500 sites across the UK.
Nick Collins, chief executive officer of the group, told PA that it believes it has potential for growth across the UK but flagged specific opportunities in Greater London and the North East.
The boss said recent sales demand has been strong despite rising pressure on household finances.
“We gather a huge amount of data, looking at spending, different products, times, locations, and so far we haven’t seen any noticeable changes related to the cost of living,” he said.
“We have been focused on value for money and that has positioned us well from a consumer point of view compared with some competitors.”
The company said it has been “delighted” with sales since the end of the last financial year, with recent like-for-like sales up 17.9% against pre-pandemic levels.
Mr Collins added: “Whilst the short-term economic outlook is challenging, we are in an excellent position to weather the storm and to take advantage of growth opportunities coming out of it.
“We have a strong balance sheet, a very capable and highly motivated team and an affordable, value for money all-day offer with enormous scope for further expansion across the UK.”
