Loungers shares jump on ‘encouraging’ post-lockdown sales
Shares in Loungers, the owner of the Cosy Club and Lounge brands, surged this morning after the casual dining chain said it is “encouraged” by trading levels since reopening last month.
Loungers’ share price jumped 13.49 per cent to 122p after the company said it was “confident” of its future after the coronavirus pandemic.
The restaurant and bar group said sales dipped 1.7 per cent in the period from 4 July to 2 August, compared to the same time last year.
Loungers has reopened 164 sites across the UK since restrictions on the hospitality industry were lifted.
The Cosy Club in Leicester is the only venue to remain closed due to the local lockdown in the city. Loungers plans to reopen the site on Friday when extended lockdown restrictions come to an end in the city.
“Whilst these are still early days, we are encouraged by the initial strength of our trading performance to date and remain confident the company will emerge strongly from this period,” Loungers said this morning.
The company will publish its full-year results next month, when it said it hopes to resume providing fuller guidance to the market.
The optimistic update is in contrast with the mood of many casual dining outlets, which have been struggling after being forced to close all sites for more than three months.
Social distancing measures, lower footfall and consumer nerves have also impacted sales for many firms since reopening.
More than three-quarters of hospitality businesses are at risk of insolvency within 12 months, research by UK Hospitality showed.
The survey, published yesterday, showed that one in five hospitality businesses are at significant risk of insolvency within a year, while more than half believe they face a slight risk of going bust in the next 12 months.