Wagamama, the Duke Street Capital-backed chain, has reported a 9.8% increase in like-for-like sales in the first quarter of its current financial year, with total sales up 16.6% on the previous year to £75.6m.
Restaurant EBITDA in the period to 14 August stood at £16.5m and adjusted EBITDA at £12.1m during the quarter, which were both in double-digit growth.
The company, which recently had ratings upgrades from both Moody’s and Standard & Poor’s, said that its lfl sales had been ahead of the competition for 120 consecutive weeks and come on the back of two strong prior years (Q1 FY16: 13.1%, Q1 FY15: 9.2%).
The David Campbell-led group said that “active estate management” was driving average unit volumes.
In the US, the group’s three Boston sites experienced continued strong LFL growth at 10.8%.
During the period, the company opened three new UK sites in Bromley, Staines and London Bankside, whilst its Heathrow T5 rebuild site opened “successfully, achieving three company weekly sales records in a row”. Internationally, the group opened franchise sites in Cyprus (Ayia Napa), Gibraltar, and Netherlands (Rotterdam) in the period.
The company said its New York City flagship site remains on target to open later this quarter.
Campbell said: “I am delighted to report another very strong set of results, especially on the back of two prior years of robust performance. LFL growth of 9.8% shows that we continue to trade strongly and are positioned favourably within the market. We continue to seek an even greater understanding of our guests, which drives our ongoing improvements.
“Operationally all of our company owned estate, in the UK and US, has ‘kaizen’ embedded, and physically by the end of FY17 the majority of restaurants will either be newly built, rebuilt or refurbished with the ‘kaizen’ design. ‘Kaizen’ is also in all new franchise restaurants and rolling out through our remaining estate.
“We are pleased with the new openings in Q1 and current pipeline of new restaurants. We also continue to actively manage the estate by not renewing leases in a very small number of less well performing sites. New York City has not been without its challenges, but we are on target to open at 210 5th Avenue in Q2, further strengthening our presence in the US.
“It’s particularly pleasing to have both Moody’s and Standard & Poor’s upgrade our ratings to levels above most of our peers. This reflects the strong financial results on both a ‘4 wall’ restaurant and adjusted EBITDA basis, and continued strong cash conversion. We are confident that our strong financial position means that we are well placed to further invest and grow market share and we are excited about the future opportunity.”
David Campbell will be talking to MCA at this year’s Restaurant Conference about the evolution of Wagamama and key factors behind the group’s impressive performance over the last two years. He will also be sharing an exclusive video of the group’s New York City flagship restaurant. The all-day conference, which focuses on the evolving culture of eating out, and how developing a people-led culture will increasingly separate the winners from the losers, takes place on 29 September at the Gran Connaught Rooms in Covent Garden, London. For more information and to book for this years conference please contact Teresa Norman on email@example.com or call 01293 846521.