Restaurant Share Discussion Threads

[farrugia] 02/3/2023 09:16

This is a actually a decent company. They have managed the fuel/gas hedging risks well and they are winning market share in a difficult environment. Interest debt is also capped. Not only that but their concessions in airports must now be recovering. Some keep harking about their debt but they also have plenty of freehold sites. Lastly if you look at director dealings - directors have been buying plenty of shares last year - I like to see that as opposed to plenty of sales!

This is basically valued at peanuts compared to USA plays like Chipotle Mexican Grill, Inc. or
Wingstop Inc

'Further, TRG’s airport concessions span 43 sites that are recovering strongly amid booming demand for trips. This division is set up as its own legal entity after TRG’s pandemic-era restructuring, and analysts reckon that alone could be worth about £100 million.

Brunning & Price’s 41 freehold sites are valued at £160 million, meanwhile, and Wagamama remains a middle-class favourite with a strong brand; Roberta Ciaccia at broker Investec describes it as “one of the best-positioned UK leisure companies going into 2023”. Fellow broker Liberum gives Wagamama alone a £700 million enterprise value.'

[porsche1945] 02/3/2023 01:09

Did tell holders to dump this shxt when the share price was over a quid. It’s a dog even by U.K. listed leisure standards, tons of debt, crxp management and the U.K. in terminal decline with high inflation a trashed currency and parabolic rates. The only thing worth any money is Wagamama and they overpaid for that x2 getting stitched up by private equity. Will end up being taken private again. Dump it.

[queenbreguet] 01/3/2023 15:39

Um maybe there is some truth to this rumour given the way the share price is gaining.

[adobbing] 01/3/2023 11:13

Pub operators crying into their beers over closures

Dominic WalshFebruary 28 2023, 12.00am
The latest gloomy prognosis, from the British Beer and Pub Association, warns the chancellor that, without support in the forthcoming budget, up to 2,000 pubs could be forced to call time, leading to 25,000 job losses. It wants Jeremy Hunt to freeze beer duty as part of a package of measures, or face the prospect of 288 million fewer pints being sold in locals.

There are also rumours that an advisory firm, believed to be PwC, has been approached by another big pubs company about overseeing some form of restructuring or asset sell-off.

One suggestion is that The Restaurant Group, under pressure from Oasis Management Company, its Hong Kong-based activist investor, could sell its Brunning & Price gastropub business.

Another theory is that one of the groups that has both managed and tenanted pubs could sell off its tenanted and leased division. Shares in The Restaurant Group ticked up 0.7 per cent, or ¼p, to 35¼p, while Wetherspoon gained a frothier 20p, or 3.7 per cent, to 562½p.

[queenbreguet] 01/3/2023 10:37

Good momentum today

[queenbreguet] 01/3/2023 09:40

Oasis Reaffirms its Position and the Need for Change at The Restaurant Group
02/21/2023 | 02:01am EST


Oasis, the second largest shareholder in The Restaurant Group (“TRG” or the “Company”;), notes the response of the Board of Directors (“Board”) to our initial press release (both dated 16th February 2023).

Oasis makes the following key points of clarification:

1. TRG’s Communication with the Market:

The Board states that “the operational performance of TRG since COVID has also been strong” across its business. This confirmation is welcomed by Oasis as – most significantly for shareholders –

TRG had not disclosed any trading information on its performance since the publication of its interim results on 8th September 2022.
In TRG’s interim results, the Board highlighted considerable risk associated with the cost-of-living crisis impacting customer spend. However, unlike other major listed companies in the UK hospitality sector, the Board decided not to issue a trading update in January 2022, missing a clear opportunity to inform stakeholders on the impact of those concerns.
Further to this, the statutory accounts provide no segmental information on the operating performance of its four business areas (other than on sales), making it impossible for shareholders and the market to assess how any or all of its segments are performing, and thus, unsurprisingly, TRG is assigned a low valuation rating.
The Board also points to its two-year debt extension as “hugely important”, even though no details were provided on announcement of the new lending terms and the associated costs of the refinancing. One negative outcome is that TRG’s cash headroom has fallen from £227m in June 2021 to £184m in June 2022 and to £140m in December 2022.

Again, Oasis reiterates the need for increased transparency with the market, especially on financially material developments.

2. TRG’s Strategic Review:

Oasis welcomes the limited public disclosure that the Board is reviewing the Group’s strategic options as no announcement had been made on such a review prior to the Board’s response.

Despite this, the Board has refrained from communicating detail on the scope and the process which this review is following. It is important that a process like this is supported and aligned to the expectations of shareholders in order to optimize the outcome, therefore, engagement of shareholders in the process from the start should have been considered necessary.

The Board’s response is the first public announcement of any strategic review conducted by TRG.
The Board has made no prior attempt to publicly communicate any details of the scope or process of this review to shareholders – let alone engage with them on it.

The Board’s decision to exclude shareholders from the ongoing strategic review process necessitates heightened scrutiny on the announced outcome and expectations will be equally high on the retrospective disclosure.

Given this lack of timely and transparent communication, Oasis reminds the Board that it is not a shareholder’s responsibility to come up with the strategy for the Board to consider. However, shareholders are well within their rights to request an independent review following a considerable period of share price underperformance, where no strategic review has been communicated publicly and there is considerable doubt as to the Board’s alignment with the shareholder experience.

3. Oasis’s Shareholding:

Oasis confirms that it has continuously maintained a shareholding in TRG since August 2020 and made the necessary regulatory disclosures when required.

The Board’s attempt to denigrate Oasis’s engagement by their statement that “our Chairman met Oasis face-face for the first time in December 2022” omits to mention that Oasis: (1) has been communicating since well before the incumbent Chair’s tenure; and (2) first requested a meeting with the new Chairman following a meeting with TRG’s CEO in June 2022; the earliest date offered to Oasis was a September phone conversation, nearly three months after our initial request.

4. Engagement with Shareholders:

The Board’s response to our press release also completely avoids any mention of TRG’s three equity capital raises in the past 5 years (two of which were under the current management team) at prices substantially in excess of the current share price.

Shareholders unfortunate enough to participate in those equity raises in the past 5 years (two of which were under the current management team) – have seen the value of their investment collapse by c.70% since 2018.

Longer-term shareholders have suffered even worse, losing a staggering c.93% since the 2015 peak, whilst currently receiving no dividends, buybacks or capital appreciation.

Rather than acknowledge the existence of any longer-term underperformance, the Board’s sole response is to refer to the intervening impact of the pandemic. Without such recognition, shareholders can have no confidence in the Board’s ability to remedy the situation and drive shareholder value growth, which serves only to demonstrate the need for increased Board accountability.

As noted in Oasis’ initial press release, TRG losses are “materially worse than its closest peers, and disproportionately worse than what the impact of the challenging sector backdrop would alone justify” and illustrate a decline “which began before the pandemic”. The Board’s refusal to acknowledge this objective reality serves only to widen the gap between the shareholder experience and the need for accountability at Board level.

Oasis reiterates its desire to co-operate constructively with the Board. However, more of the same ruinous and devastating share price performance is not an option – failure by the Board to recognise and work with stakeholders who are committed to TRG’s future will leave shareholders with no recourse but to seek to hold TRG’s representatives to account.


About Oasis

Oasis Management Company Ltd. manages private investment funds focused on opportunities in a wide array of asset classes across countries and sectors. Oasis was founded in 2002 by Seth H. Fischer, who leads the firm as its Chief Investment Officer. More information about Oasis is available at

[m_kerr] 16/2/2023 22:34

having read the oasis letter, they are spot on. this is not complicated stuff at all. TRG have raised huge amounts of capital, firstly to pay for an overpriced acquisition, and secondly to keep the lights on in their structurally challenged leisure arm. that's a major reason for the share price being down by about 90%. there are problems in terms of a lack of segmental reporting, lack of focus (why are they still running Chiquito and f&b?), and a lack of alignment with shareholders.

despite attacking oasis for owning 6.5%, the board own about 0.3% between them (just as well given the share price performance). their annual remuneration is around 3 X the value of their shareholding. they can't risk their jobs by letting an activist on the board.

TRG respond by attacking the messenger, pointing to the benefits of putting their largest business unit in a CVA (wiping out any equity), and say the rest of the portfolio is 'outperforming' on sales. not impressed at all.

[adobbing] 16/2/2023 15:30

A robust response!

[xtrader1965] 16/2/2023 15:14

TRGs response is out. Am thinking results on the 8th March won't be disappointing

[danb45] 24/1/2023 20:31

they're all pretty much full lunch and dinner time :-) in my experience

[m_kerr] 23/1/2023 22:50

the issue in london isn't weekends, it's the working week, monday and friday. as well as full time home workers, there's lots of TW*Ts in london - those that work in the office Tuesday, Wednesday And Thursday. that trend has hit city centre focused chains quite hard and doesn't look like it's going to change anytime soon.

[m_kerr] 21/1/2023 20:28

there's two decent parts of this company, and one bad. the decent is the pubs (because of the asset backing), and wagamama. frankie and benny's, Chiquito, are dross, and should have been written off in the pandemic. they'd then be able to concentrate time and resources on the better segments of their portfolio. i understand the lease liabilities in the dross segment are non recourse to the group which is a major plus.

they paid £559m for wagamama at the top of the market, and the current enterprise value (excluding leases, which have been significantly reduced following the CVA) is about £440m. they've got £160m in pub freeholds meaning the rest is valued at £280m.

so as long as management don't completely mess up capital allocation like they have done in the past, there's a good chance returns will be good from here on in.

[ali47fish] 21/1/2023 12:08

whar does oasis want please ado

[adobbing] 21/1/2023 11:20

Hong Kong Investor Oasis Takes Aim at Wagamama Owner

Oasis Management has taken a 5% stake in The Restaurant Group Activist investor’s move raises prospect of a shake-up

Sabah Meddings
19 January 2023 at 18:13 GMT
The Restaurant Group has more than 420 restaurants and pubs across the UK, including Wagamama.
The Restaurant Group has more than 420 restaurants and pubs across the UK, including Wagamama.
Photographer: Jason Alden/Bloomberg
Updated on20 January 2023 at 07:42 GMT

The activist fund manager Oasis Management has taken a stake in Wagamama owner The Restaurant Group, raising the prospect of a shake-up at the pub and dining company.

Hong Kong-based Oasis, which previously waged a successful activist campaign at British manufacturer Premier Foods, has amassed a 5% stake in The Restaurant Group, according to a company filing.

[libertine] 21/1/2023 11:16

Restaurant Group PLC Holding(s) in Company
28/11/2022 1:00pm
UK Regulatory (RNS & others)
Name

Oasis Management Company Ltd.
Oasis Investments II Master Fund Ltd. Voting Rights 38262777 5.001262%

[shaan449] 21/1/2023 10:12

Activist investment fund Oasis has bought 5% in RTN mentioned in today's Daily Telegraph.

[mashman] 18/1/2023 07:58

Tipped in the Times is a huge sell signal

[adobbing] 15/1/2023 11:59

Share tip: Acquire an appetite for shares in TRG

January 08 2023, 12.01am
For the price of a bowl of Wagamama’s flagship chicken ramen, you can buy 40 shares in its owner, The Restaurant Group. Are things really that bleak as the cost of living crisis trims our appetite for eating out?

The numbers initially suggest so. In September, TRG — whose brands also include Frankie & Benny’s and pub chain Brunning & Price — took a £45 million impairment charge, blaming inflation and the darkening economic outlook. On top of that, TRG’s sales for the half year to July were still £100 million short of pre-Covid levels, for which it had a scattergun set of excuses, including heatwaves hitting noodle demand.

And since then, spending in the casual dining market has weakened, particularly outside the M25, according to the booking firm OpenTable. Meanwhile, some costs are still increasing: the national living wage will rise 10 per cent in April.

On the face of it, then, TRG doesn’t look a tasty dish for investors — especially as its boss, Andy Hornby, is most famous for running HBOS when it had to be rescued in a £20 billion bailout.

Shares in TRG, which has about 420 restaurants and pubs around the UK, are currently nursing a hangover. A share price that once enjoyed highs above £5 in 2015 is now about 34p, for a market cap of £267 million; it’s notable that TRG paid £559 million for Wagamama just four years ago.

But it’s not all gloom. TRG said last month it had struck a deal with lenders to extend its debt coverage by two years, giving it £140 million of cash headroom, while its £7 million acquisition of cheap Mexican food chain Barburrito last summer should allow it to benefit from consumers trading down this year.

Further, TRG’s airport concessions span 43 sites that are recovering strongly amid booming demand for trips. This division is set up as its own legal entity after TRG’s pandemic-era restructuring, and analysts reckon that alone could be worth about £100 million.

Brunning & Price’s 41 freehold sites are valued at £160 million, meanwhile, and Wagamama remains a middle-class favourite with a strong brand; Roberta Ciaccia at broker Investec describes it as “one of the best-positioned UK leisure companies going into 2023”. Fellow broker Liberum gives Wagamama alone a £700 million enterprise value.

Looking at the sum of its parts, TRG looks ripe for a buyout. It’s not an easy or safe investment to slurp up, but when private equity starts shopping for leisure again, TRG looks an appealing purchase. Buy, if you’re looking for a taste of risk.

[danb45] 15/1/2023 10:51

tipped in the Times

[sanks] 03/12/2022 14:29

Mrs Simmons is my mates wife.. she's helping me over on THG.. need some help here too, if you can shagdrip it to 4p
.. then I'll buy and sell to some mug punter at 40p

Hope this helps

[sankshiela] 08/10/2022 19:09

The most irrelevant thing is Mrs Immons - feel sorry for you that this troll slag is now on this board

She’s a bar fly from the watling in London

[mrsimmons] 08/10/2022 18:24

BUT - the Balance Sheet is awash with intangibles such as goodwill and right to use asets. If you dig down into the Notes, you will see RTN is vulnerable to some pretty horrible impairmant charges if consumer spending drops off and/or price inflation goes unchecke

This is Irrelevant pal. Completely irrelevant.