Restaurant Group to raise £175m to protect against potential pandemic resurgence
Wagamama owner The Restaurant Group is planning to raise £175m to help protect its balance sheet against any potential resurgence of the Covid-19 pandemic.
Proceeds from the capital raise will also be used to expand its pubs and Wagamama businesses, and pay down debt.
TRG said it anticipates that Covid-19, the associated restrictions, and its future possible duration will “materially impact the group’s ability to reduce leverage organically or support selective growth opportunities in the medium term”.
Wagamama owner The Restaurant Group is planning to raise £175m to help protect its balance sheet against any potential resurgence of the Covid-19 pandemic.
Proceeds from the capital raise will also be used to expand its pubs and Wagamama businesses, and pay down debt.
TRG said it anticipates that Covid-19, the associated restrictions, and its future possible duration will “materially impact the group’s ability to reduce leverage organically or support selective growth opportunities in the medium term”.
Over the past year, TRG has exited around 60% of its leisure estate that was identified as “structurally unattractive” and half of concessions deemed uneconomical for medium-term trading.
It has reduced lease liabilities by around half, to roughly £480m.
The group now operates around 400 pubs and restaurants in the UK.
Andy Hornby, chief executive, said: “The capital raising… will significantly strengthen the group’s balance sheet and provides TRG with the flexibility to invest in growing our business.
“Whilst the sector outlook remains uncertain, and we are mindful of continuing restrictions across the UK, we are confident that the actions announced today will allow us to emerge as one of the long-term winners.”
TRG made a statutory pretax loss of £127.6m in the year ending 27 December, deepening from an equivalent loss of £37.3m in 2019. Total revenue dropped to £459.8m, from nearly £1.1bn in the previous year.
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