Thai Leisure Group (TLG), the Thaikhun and Chaophraya operator, has reported a 23% decline in company EBITDA to £3m for the year to 31 July 2016, a period that it described as one of “organisational development and consolidation which has laid the foundations for the continuing growth and progress of the company”.
During the year, the then 18-strong group, which opened five sites during the period, saw turnover increase 11.3% to £32.5m. However, restaurant EBITDA fell 6.8% to £5.5m in the “face of some significant sector-wide cost pressures”.
The Ian Leigh-led company, which plans to launch a new Cantonese concept later this year, has opened three new sites since its year end.
However, it said that in light of tighter trading conditions and a potential softening of the property market, it had taken the opportunity to review its property pipeline.
The company said: “To this end, we have decided not to progress our interest in three future restaurant sites and as such, have incurred related abortive costs of approximately £0.4m.”
The company said that the fall in company EBITDA during the year came after “deducting head office costs and adding back pre-trading and exceptional costs relating to our expansion, and property pipeline”.
The group said that its focus remained on expanding its two growth brands, Thaikhun and Chaophraya, and to identify opportunities to develop new and highly-differentiated restaurant concepts that fit with the group.
The company also said it had established a dedicated head office, and instigated a number of management initiatives – “delivering enhanced central functions, systems and processes – designed to support the business as it develops and grows further.”
Leigh, managing director, said: “This was a strong year of development for the group, in which we opened a significant number of new restaurants. In addition, a new management team established industry-leading central support functions designed to support the on-going growth and development of our business. Clearly, investments in our central operations and in a number of new restaurants as well as the adjustments we have made to the future property pipeline have tempered group EBITDA growth in the period. However, as a business we are in a strong position as we continue to expand at a significant rate and expect to see the full benefit of the new restaurants we have opened in this period coming through in the current financial year.”