Frankie & Benny’s and Chiquito plan to close up to 90 sites by the end of next year in another blow to Britain’s High Street
- Decision comes after The Restaurant Group closed 18 stores in 2019
- Comes amid tough period for dining, with Jamie’s Italian collapsing last year
- The move will take its leisure portfolio down to 260-275 sites by the end of 2021
The owner of restaurant chain Frankie & Benny’s has said it plans to close up to 90 restaurants by the end of next year.
The decision by The Restaurant Group, which also owns Mexican chain Chiquito, comes after it closed 18 stores across the two brands in 2019.
The closure plan comes amid a tough period for casual dining chains, with rivals such as Jamie’s Italian collapsing over the past year and Pizza Express struggling.
The owner of restaurant chain Frankie & Benny’s has said it plans to close up to 90 restaurants by the end of next year
TRG said at least 31 of its leisure sites will not see their contract renewed, with the number potentially rising depending on discussions with landlords.
It added that it also expects to dispose of up to 35 further sites and sell another 12 freehold sites.
It also plans to convert up to 12 current leisure restaurants into its more profitable Wagamama Japanese brand.
The move will take its leisure portfolio down to between 260 and 275 sites by the end of 2021, from 350.
TRG confirmed the closure plans as it reported like-for-like sales growth of 2.7 per cent for the year to December.
The group saw total sales soar 56.4 per cent to £1.07 billion as it was buoyed by its £559 million purchase of Wagamama in October 2018.
The decision by The Restaurant Group, which also owns Mexican chain Chiquito, comes after it closed 18 stores across the two brands in 2019
It said Wagamama continues to drive growth in the business, with the pan-Asian chain reporting an 8.5 per cent increase in like-for-like sales over the period.
The group, which has 650 sites in total, slipped to a pre-tax loss of £37.3 million for the year, from a £13.9 million loss in 2018, as it was weighed down by its unprofitable leisure restaurants.
Andy Hornby, chief executive officer of TRG, said: ‘Our three growth businesses of Wagamama, concessions and pubs are all out-performing their respective markets and have clear potential for further growth.
‘I am also acutely aware of the challenges facing our leisure business and the wider casual dining sector.
‘Following an extensive review we have defined three clear strategic priorities for the next two years: Grow our Wagamama, concessions and pubs businesses; rationalise our leisure business; and accelerate our deleveraging profile.’
The move by the firm follows the closures of several high street chains last year, the most prominent being chef Jamie Oliver’s brand Jamie’s Italian, which collapsed in May.
The chain had run up £71.5million in debt and moves by administrators saw 22 of its 25 sites closed, with the loss of around 1,000 jobs.
The 43-year-old, who has netted £240 million during 20 years in the public eye, said he was ‘devastated’ and ‘deeply saddened by the outcome’.
Oliver said at the time of the collapse: ‘I appreciate how difficult this is for everyone affected. It’s been a real pleasure serving you.’
And popular chain Pizza Express, which was founded in 1969, was faced with the threat of closure last year due to its debts of around £655million.
The popular restaurant is thought to have struggled with rising costs and a tough UK trading environment, putting 14,000 jobs at risk.
The brand has around 600 restaurants across the UK and Ireland, and if these close, hundreds of thousands of workers could be out of a job.
Which restaurants are closing amid the high street bloodbath?
Jamie Oliver’s chains are among the casualties of the bloodbath sweeping the British high street.
Dining chains Giraffe and Ed’s Easy Diner revealed in March last year that their owner plans to close a third of the brand’s sites.
Boparan Restaurant Group (BRG) announced that a total of 27 out of its 87 restaurants would close. It bought Giraffe from Tesco in 2016 and combined it with Ed’s Easy Diner after acquiring the chain that same year.
Underlying losses of £1.6million that hit the combined entity were revealed in its most recently available annual accounts.
Giraffe (pictured) is among the casualties of the bloodbath sweeping the British high street
Last year, several casual dining brands closed sites amid rising costs and tougher competition.
Prezzo, Byron, Carluccio’s, Gaucho and Gourmet Burger Kitchen all shut branches.
In November, creditors of Gourmet Burger Kitchen approved a plan to close 17 of the premium burger chain’s restaurants, putting around 250 jobs at risk.
South Africa’s Famous Brands, which acquired GBK in 2016 for £120 million, has previously unveiled stinging losses at the burger chain.
The firm said in October that it would take a pre-tax impairment charge of 874 million rand (£47.2 million) due to the brand’s sustained under-performance. Also in 2018, Prezzo announced that 94 of its 300 outlets will close.
KPMG found the number of restaurants experiencing significant financial distress was 11,091 in March 2018, up 8 per cent on a year earlier.