Gusto Italian reports ‘resilient results’

Gusto Italian reported a resilient performance in its financial results for the year to September 2021, with a turnover of £12.3m and an EBITDA of £585,000.

The premium casual restaurant group – backed by private equity investor Palatine – also reported outperforming expectations in October and November 2020 along with a resilient performance despite being able to trade for approximately six months of the financial year.

The group plans to grow its estate by expanding further South over the coming year, adding to a portfolio of 13 restaurants in cities across the North and the Midlands, with the most recent opening in Nottingham in December 2021.

The brand is close to securing a site in the South, and has been using footfall mapping technology to pinpoint locations for new sites, CEO Matt Snell told MCA.

The flagship Nottingham restaurant will serve as a basis for design concepts for both new and refurbished venues.

“The key new concepts are in design – and wherever possible we’re going to incorporate them into all our new openings and refurbishments to deliver an immersive and unique dining experience,” Snell said.

“The Theatre Kitchen unites the kitchen and dining area to create a truly open kitchen, giving guests the opportunity to witness our skilled chefs first-hand, while the Pizza Experience, unique to Gusto Italian, provides two and a half hours of feasting and entertainment at the Chef’s Table.

“It’s hugely fun, allows our guests to learn about the provenance and quality of our food, and drives great spend-per-head. It also markets itself, because so many of our bookings come from people who have been in the restaurant and seen another group having such a great time doing it.”

The statement also described a shift in focus from guest-facing discounting towards customer loyalty through the Gusto Gold Rewards programme, which it reports has resulted in customer feedback scores beyond the industry average.

“We continue to be really pleased with our trading performance from a sales point of view – however the inflation issues that everyone is aware of is making progress at an EBITDA level extremely challenging,” Snell added.

“Consumer spending is being squeezed, but people still want to celebrate their special occasions. That makes it all the more vital to make sure we’re providing memorable experiences and incredible Italian food and drink every time, something our industry-leading feedback scores attest to.”

In addition to new sites, the group has invested in a self-funded £2m capex programme to renovate existing locations in Liverpool, Leeds, and Edinburgh, as well as an apprenticeship scheme and a partnership with payroll software PayCaptain to strengthen its employee proposition.

The partnership aims to promote financial awareness and wellbeing for Gusto employees, while the apprenticeship scheme will enable junior managers to achieve degree-level qualifications and improve pathways for internal progression.

“Retention has always been one of our strong suits and initiatives like these are great ways to incentivise our people to stay with us,” Snell said.

Commenting on the financial results, he added: “The performance of our restaurants, feedback from customers, and positivity of our people are all representative of the momentum we feel building behind Gusto Italian. Given the macro-economic climate, this will be particularly important in ensuring we can remain resilient in response to the unprecedented headwinds facing the hospitality sector.

“Although the next 18-24 months will no doubt bring plenty of challenges, this is an exciting time for the business, and our financial footing offers us an opportunity to continue to invest in our people, develop our sites and expand our footprint”.

Commenting on the accounts to September 2021, CFO Frank Bandura said, “We are delighted to report strong trading since the end of lockdown resulting in turnover of £12.4m and a sizeable EBITDA contribution of £585,000.

“With a year-end cash position of £5.5m, a strong balance sheet and a supportive shareholder in Palatine Private Equity, Gusto Italian has the resources to continue growing in the future”.

Snell added, “Considering that the year under review included two full lockdowns, the implementation of a regional tiering system, partial re-openings and also periods of time when only outdoor trading was allowed, these financial results present a remarkably robust performance and one that would not have been achieved without the fantastic efforts of our loyal suppliers and hard-working staff”.