La Tasca Group, the tapas-led casual dining group, has this morning announced underlying profits up 18.5% to £10m on sales up 13.8% to £55.6m.
The group, which as well as its eponymous Spanish restaurant chain operates La Vina and fledgling diner Sam & Maxie’s, reported an average return on capital invested of 28% - ahead of its 26% target.
The group said that current trading had been hit by the World Cup, although normal trading levels should resume after this event.
This prompted Mark Brumby, an analyst at Oriel Securities, to suggest that if La Tasca, a group heavily oriented towards female customers, had been hit, other casual dining groups may have suffered more.
He said: “There could be some pretty poor trading statements out there. However, the critical issue will be whether and when the restaurants bounce back. We think it will.
“Demographic and economic trends are excellent and, arguably, with the World Cup effectively over for the majority of us, next Saturday could be the test.”
The company now operates 64 restaurants. During the year to 30 April, 2006, the group opened 14 new restaurants, comprising eight La Tascas, four La Vinas, one Sam & Maxie’s, plus a La Tasca in Baltimore in the USA.
The company said that delayed openings at five restaurants plus an increase in pre-opening costs at Sam & Maxie’s at Stevenage and delays at Baltimore offset the contribution from restaurants it opened earlier in the year.
La Tasca, which intends to open 14 new restaurants in the 2006/07 financial year, weighted to the second half, said there was further potential to expand in high footfall areas, and it would focus on London and the South East.
Openings scheduled for the current year include two more Sam & Maxie’s outlets, in Milton Keynes and in the Trafford Centre, Manchester. The group said it thought the concept had the potential to become a national brand.
The company does not disclose like-for-like sales but it did say some of its oldest restaurants, such as Deansgate, Manchester, continued to grow profits and sales, year-on-year.
Pre-tax profits, before goodwill amortisation, was up 55.3% to £6.1m.
La Tasca said that the performance came in spite of considerable cost increases as a result of licensing reform, duty increases, utility increases, rates revaluation and minimum wage.
The company has increased the number of restaurant managers in the Managing Partner scheme – whereby managers take a smaller basic salary but a percentage of store profits.
During the year the company spent £10.7m opening and developing restaurants, which meant net debt rose £2m to £16.7m.
