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Tue 28th Feb 2017 - Update: Revolution and Greggs results
Revolution reports like-for-likes up 2%: Revolution Bars Group has reported like-for-like sales rose 2% for the six months ended 31 December 2016. Revenue was £66.7m (FY16: £59.2m), an increase of 12.7%. Like-for-like sales growth for the eight weeks to 25 February rose by +1.7%. Adjusted Ebitda was up 13.6% to £9.2m (FY16: £8.1m). It opened four new Revolución de Cuba bars at Harrogate, Aberdeen, Reading and Glasgow and its estate grew to 66 sites with 53 Revolution and 13 Revolución de Cuba bars. Chief executive Mark McQuater said: “I am delighted to report another good set of results for Revolution Bars Group. Our finely tuned operating model has delivered like-for-like sales growth and well planned expansion. During the period we have added another four Revolución de Cuba units taking the estate to 66 units, along with two more bars scheduled for opening in the second half, and we are confident of meeting our strategic growth targets.” Chairman Keith Edelman added: “The group’s strategy is to provide high quality leisure retail brands in the bar and restaurant sector. We will continue to grow the estate under our two brands, Revolution and Revolución de Cuba, and, having opened four new Revolución de Cuba bars in the period, we now operate from 66 premium bars nationwide. We have expanded the Revolución de Cuba estate to thirteen units and believe there remains significant scope for further expansion. This brand is well-positioned and will continue to be the focus for our growth in the short term. We will also expand our Revolution estate and we will be opening two new Revolution bars before the summer. In the last six months, we have continued on the journey that we started at IPO in March 2015. Turnover growth, positive like-for-like sales and improved profit conversion were all pleasing to note and reflect, in my view, the underlying appeal of the brands to its target customers. It was also particularly pleasing to open four new bars in Harrogate, Reading, Aberdeen and Glasgow during the period and all are trading in line with our pre-investment expectations. As previously stated, the board is adopting a progressive dividend policy which reflects the cash flow generation and the long-term earnings potential of the group whilst retaining sufficient capital to fund investment to grow the business. In line with this policy, the board has approved an interim dividend and the Company will pay an interim dividend of 1.65 pence per share in respect of the six months to 31 December 2016. This will be paid on 6 April 2017 to shareholders on the register on 17 March 2017. I would like to acknowledge the dedication and hard work demonstrated by our employees along with our management teams. Our people are key to the success of the group and I would like to thank them all for their support during FY17 thus far and for their continued contribution to our success. Recent trading over January and February has been positive. Like-for-like sales for the eight weeks to 25 February rose by 1.7%. This, taken together with improved Adjusted PBT and the impact of new sites, gives us the platform to be confident about our prospects for the future.” 

Greggs reports strong 2016: Bakery business Greggs has report total sales rose 7.0% to £894.2m (2015: £835.7m) in the year to 31 December 2016 with like-for-like sales up 4.2% (2015: 4.7%). Operating profit excluding property profits and exceptional items was up 8.6% to £78.1m (2015: £71.9m). Pre-tax profit excluding exceptional items was £80.3m (2015: £73.0m). It made further improvements to product range, including extended choice in hot drinks and hot food – its ‘Balanced Choice’ range of healthier options now accounts for over 10% of sales. A total of 208 shops were refurbished – 92% of shop estate are now transformed to its food-on-the-go format. A total of 145 new shops opened, with 79 closures (66 net openings); 1,764 shops were trading at 31 December 2016. It stated that investment in upgraded operating systems is progressing well – a finance system has been implemented and shop replenishment successfully trialled. Like-for-like sales were up by 2% in the eight weeks to 25 February 2017. Chief executive Roger Whiteside said: “In 2016 we delivered another strong performance as we continued on our journey to transform Greggs from a traditional bakery business into a modern, attractive food-on-the-go retailer. Our product offer is evolving to meet the changing needs of our customers and our shop estate and service levels have benefited from significant investment. The UK consumer outlook is more challenging than we have seen in recent years, with industry-wide pressures emerging in commodities as well as labour costs. However, we are confident of making further progress as we implement our plan to grow Greggs as a contemporary food-on-the-go brand. The overall market for food-on-the-go continued to be favourable during 2016, with growing consumer disposable income supporting demand despite uncertainty in the economic outlook. Customer footfall remained challenging in a number of shopping locations, supporting our strategy of progressively reducing our dependence on general shopping activity through alternative shop location and enhancing our offer to meet customers’ needs at different times of the day. The market for food-on-the-go remains highly competitive but we saw like-for-like sales and transaction growth throughout 2016, demonstrating the strength of the Greggs brand, its relevance and our quality, value and differentiated offer. Our strategic plan, first announced in 2013, set out to show that Greggs could be a winning brand in the highly competitive food-on-the-go market. Our business has been transformed in that time delivering an unbroken record of positive like-for-like sales and new levels of profit. It is now time to set a higher aspiration for the business, our purpose being to make good freshly prepared food accessible to everyone, with the aim of becoming the customers’ favourite for food-on-the-go.”

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