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The Restaurant Group - Challenging Q4 leads to downgrades

March 2017

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • RTN
  • Price:
  • 304p
The long hoped for recovery has failed to materialise with the shares lurching below £3. Although it noted results for the year ended 1 January are expected to be in line, recent trading was challenging, with Q4 ’16 like-for-like sales down 5.9%, due to weakness in its leisure brands.As previously promised it has started price and menu trials across Frankie & Benny’s with significant price cuts, which alongside increases in the National Living Wage, revaluation of business rates and higher purchasing costs (due to the weak pound), means it’s going to be challenging in the short term.Numis forecasts downgraded pretax profit for 2017 of £56.6m for eps of 22.3p.Disappointing that trading h ...

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