Takeaway sales, reduced rents at Wagamama push The Restaurant Group higher

Shares in The Restaurant Group were well into the green on Wednesday, after its Wagamama chain posted decent third quarter earnings, despite the ongoing impact of Covid-19.

The company said UK revenue in the third quarter was 20.8% to £70.3m, as its restaurants reopened in a phased manner for eat-in dining from early July.

It said customer initiatives, as well as the government’s ‘Eat Out to Help Out’ scheme operating throughout August, allowed Wagamama to drive strong footfall to its restaurants, with UK like-for-like sales of 7.4% for the quarter.

Adjusted EBITDA rose to £18.1m, with the brand saying Covid-19 continued to have an impact on trading, although it continued to manage its costs, including the negotiation of a number of rent deals which had positively impacted its EBITDA position.

“We are encouraged by the strong performance of the business in the third quarter, both for eat in and delivery,” said Wagamama chief executive officer Emma Woods.

“This was the last point we were able to trade in any sense normally and provides real confidence that the business can return to market leading performance when restrictions are again lifted.”

At 1620 GMT, shares in The Restaurant Group were up 7.5% at 68.8p.