Restaurant Share Discussion Threads

[quickmind] 01/5/2016 10:21

Just listened the conference call recording. The ceo, Danny Breithaupt, is really appalling!

[valuebuy] 30/4/2016 21:29

Total sales up 4.7% and LFLs down 2.7% with a small profits downgrade. It does seem the share price fall is a bit of an overreaction and probably due to that conference call. This group posted £128m EBITDA last year and the EV is now at a very compelling low multiple. An early wet easter and cinema releases could have impacted the short term performance and the LFL growth in the prior year appears to be weighted towards the first half so there maybe some less challenging sales comparatives for H2.

[she-ra] 30/4/2016 14:04

I don't think its entirely this company's fault. It seems they are struggling with the decline of high st and retail park shopping. People are shopping more and more online and therefore have no need to grab a bite at one of Restaurant Groups eateries.

Then there is also the continuing growth of people cooking more and more for themselves as a kind of leisure past time.

Couple all that with an obvious saturated market and I suppose its a recipe for disaster (excuse the pun).

[minerve] 30/4/2016 13:02

Clarity of the dividend needs addressing before anyone can make an investment decision.


I had lady luck on my side this week; I sold out here two days before this circus started having held it since after the last large drop - so I have held it not that long. I decided to reverse my investment decision purely because I found another share that suited me better.

My advice SELL, you can't invest in unknowns and at the moment even the management sound like they don't know what they are doing.

My daughter and I could run this company better than those overpaid clowns.

[its the oxman] 30/4/2016 08:00

Throw in a div cut and share price may head toward 200p. Scary stuff.

[philanderer] 29/4/2016 23:51

Financial Times market report..

"...Leisure and hospitality stocks slid on Friday in response to a third recent profit warning from Restaurant Group, which plunged 26.5 per cent to 275.1p. The Frankie & Benny’s owner warned on intense competition and refused to clarify its dividend policy ahead of a strategy review due in August"

[philanderer] 29/4/2016 23:39

MARKET REPORT: Restaurant Group dives as customers stay away from its Chiquito and Frankie & Benny's chains

Read more:

[mammyoko] 29/4/2016 19:23

From what I heard today, the CEO is pretty clueless about numbers and seems to have got rid of a decent CFO who presented good, clear information at just the time when the business really needs a good numbers man.It wasn't just that he didn't want to answer the questions, he clearly didn't actually know the answers and seemed to be completely unprepared.

Doesn't exactly fill me with any confidence that he is the man to lead the company at this crucial time.

[bend1pa] 29/4/2016 18:31

The competition has been there all the time they were thriving which was up to 2 years ago. So I would rule that one out. Pricing may be a significant factor. They are expensive but again alaways have been so maybe they should lower their margins.

Going out of fashion? Would that apply then to all the other pizza/pasta eateries? If customers aren't returning, either they are poor quality value, the food's no good anyway, the location (eg retail parks) is suffering a drop in visitors, or sector economics, in so far as the high st restaurant trade is suffering generally, not just RTN.

[philanderer] 29/4/2016 17:51

It`s not just the retail parks. I pass around four F&B`s in central London during the week and even at lunchtime they are pretty empty. Too expensive for what they serve up , unfashionable , too much competition , take your pick.

Chiquito is heading the same way.

Garfunkels and the pubs are the only way forward.... but with a new board. Still opening new F&B`s and Chiquitos when they were going out of fashion has been a huge mistake and burnt 100`s of millions of pounds.

No excuses , it`s been a c*ck -up

[bend1pa] 29/4/2016 17:50

Hardly a disaster waiting to happen. We're a long way from that yet. And RTN is still very profitable. I think some people are getting a bit carried away, which is the usual case when a group suffers a setback. Div cut might be 20-30%

[bend1pa] 29/4/2016 17:44

Their main problem appears to be Frankie and Benny's. Most of those outlets are located at retail parks. And consumers are not visiting retail parks in anything like the numbers that was the case up to a few years ago. Retailers are changing their shopping habits and buying more online. Similar case to the way Tesco's 'Extra' stores have been suffering in recent times.

But there have also been complaints over the quality of F&B's seafood and their treatment of disabled customers. Looking at reviews since 2015 these are very mixed and vary according to branch so difficult to assess the general standard. So maybe the economics of consumer habits have a more important bearing.

[philanderer] 29/4/2016 17:39

No faith at all the dividend will be held. This company is now being run without a CFO at a crucial time.

No director buys again today to send out any positive signal

A total disaster waiting to happen unless there`s some serious board changes.

Plenty of empty F & B`S over the long weekend :-S

[mammyoko] 29/4/2016 17:15

This guy is directly responsible for about 10% of today's movement. If he had handled this well we would have been down 10%, perhaps 15% with the loss of Critoph.

Instead because he is such a clueless numpty, didn't have a properly prepared response for the obvious question of what was behind Critoph's departure and botched all the other questions (especially the one on the dividend) we are down nearly 25%.

Surely that's what he gets paid £1.6m for? To be able to deal competently with pretty soft and respectful questions from the scribblers. My granny could have done better than that.

Sadly, that's what happens when you over-promote an Ops guy. Just don't have the educational background to be be able to handle these situations.

Bad situation. CEO is clearly a complete plonker and yet it's the competent numbers man who gets the push. This will be a disaster at the next update in August unless this guy gets the push. If this was PE owned this guy would be out on his ear after today's performance. Complete amateur

[sharw] 29/4/2016 16:54

If you haven't already done so you should set aside 30 minutes and listen to this morning's call. I give below a very rough transcript of what was said about the dividend.

17m34 Simon French (Cenkos) Ok and then the dividend?

It remains the case that we work on 2 x earnings so ... you know..

So you're saying the dividend will fall year on year 16 on 15 then

(long pause) Yep.

23m17 Jeffrey Harwood (Stifel/Oriel): on the dividend - on the statement it implies the dividend would be held but that clearly wasn't the answer to Simon's question

The group is still cash generative, the balance sheet is strong and we support the dividend

So even if the group only made 74m the dividend would still have reasonable cover on it

Exactly

24m54 Wynn Ellis (Numis)You're sending mixed messages - you said you wanted 2 x cover and you also said you wanted to support the dividend ...can you clarify ... do you want 2x or are you prepared to go below that in the short term


(whispering) I think there's some confusion there. The answer is the group is cash generative, the balance sheet is strong and it absolutely supports the dividend.

In that case can you go for a period with cover less than 2x do you think?

No - I think I've said it all on that

Well, given your guidance on PBT that suggests there would be a dividend cut because to maintain the dividend at last year's level that's not going to have twice cover

(more whispering) No - I think on this, you know, I'm pretty clear I've said it all. We're quite comfortable the cash generative balance sheet strong supports the dividend

[kidknocked] 29/4/2016 16:21

I'm in. Mark down way overdone.

[muffinhead] 29/4/2016 16:19

a lot priced in at 275p less 10p final dividend

[tsmith2] 29/4/2016 16:18

Pressure from IIs

[davidosh] 29/4/2016 16:10

I am just starting my research on this one and never looked at it or held in the past. Very strange the FD going with immediate effect after 11 years in the job and he is on a very good package too so will not be by choice and may be more bad news to come.

II think the Singers note says hold now and target £2.80 btw

[bulltradept] 29/4/2016 16:07

Wait for the pattern to base, then see where we are.

[philanderer] 29/4/2016 16:01

Yep, Canaccord`s 276p has already gone.

Surely there must be a buyout company willing to offer 390p for this pile of #~*+# ?

It`d get me out at break even ;-)

[imranawan] 29/4/2016 15:54

Well at least two of those broker target prices are likely to be reached today or on Tuesday.

[philanderer] 29/4/2016 15:34

updated:

29th april Peel Hunt hold tp 270p
29th april Canaccord hold tp 276p
29th april N+1 Singer sell -
29th april JP Morgan neutral tp 400p

[tsmith2] 29/4/2016 15:26

Look at balance sheet strength, FCF generation, PER, yield - buy imo

[mammyoko] 29/4/2016 14:33

Age-old story - the wrong guy appears to have walked the plank.

Critoph (highly credible & relevant background) seems to have fallen out with over-promoted operational lightweight, Breithaupt, now presiding over total shambles with no numbers man to cover his nakedness.

If it weren't for the fact that he is a massive holder, Critoph must have been laughing up his sleeve at the way the CEO was floundering on the analysts' call.

Presumably Critoph was blamed for the deteriorating numbers when the real fault (on today's showing) probably lies with the witless CEO.

Can't see any of the analysts on today's call backing this guy. Total remuneration of £1.6m in 2015 for one of the worst performances I've ever seen. NEDs need to get rid of this plonker fast.