‘Challenging trading environment’ hits profits at Comptoir Group
The group, which operates the Comptoir Libanais, Shawa and Yalla-Yalla brands, reported adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of £1m in its interim results for the six-month period ended 2 July 2023, down from £3.8m in its half year (H1) results for 2022 – a fall of 73.7%.
Top-line trading for the group, however, remained strong with like-for-like (LFL) sales growth of 6% (VAT adjusted) and total dine-in LFL sales (VAT adjusted) up 8.1%.
Off the back of this, group revenue rose 2.1% to £14.8m (H1 2022: £14.5m), but the impact of increased costs from food inflation, the national minimum wage and utility costs, combined with poor summer weather, meant that gross profit remained flat at £11.5m (H1 2022: £11.5m).
Overall, Comptoir, which currently owns and operates 20 restaurants, with a further six franchise restaurants, reported an IFRS loss after tax of £0.8m (H1 2022: £0.9m profit).
Beatrice Lafon, non-executive chair of Comptoir Group, noted that the group was navigating a ‘challenging trading environment’ as she praised the results, adding that the subsidence of inflationary pressures in the coming month would lead to an improved performance towards the end of this year.
“We are pleased with our first half results, delivering growth in total like-for-like sales as we continue the transformation programme we started at the end of 2022,” she said.
“Against this backdrop, the group is navigating a challenging trading environment, with the macroeconomic pressures of the continuing cost of living crisis, high inflation and the removal of government support with business rates and VAT resulting in a decrease in profit.
“Utilities costs will significantly decline from Q4 and other inflationary sensitive costs like ingredients and labour have now started to plateau. The net effect will bring improved performance towards the end of this year.”
The transformation programme includes the introduction of new menus across all brands, described as ‘the most expansive seen in several years’; and a new ‘digital experience’, which will be offered to guests in early 2024 and mark the company’s first web revamp in eight years.
Additionally, terms have been agreed for two new sites, including its first new owned site in over four years in Ealing, which is set to launch next month; and a new London flagship restaurant that’s expected to open in early 2024.
The group also continues to grow its franchise business with HMS Host, with the opening of the first franchised Shawa site in Abu Dhabi.
It is also bringing a new partner on board, which will see Comptoir open in Milan Airport next year.
“Comptoir Group remains in a strong financial position to take advantage of future opportunities and to continue to innovate. Whilst we remain cautious about the immediate future as macro challenges continue to prevail, we are optimistic about the longer-term prospects for the business,” added Lafon.
