Cost pressures take big bite out of profits at restaurant chain
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Birmingham-based restaurant group San Carlo has enjoyed its best Christmas in its 27-year history, but admitted that it is feeling the impact of rising costs.
Underlying annual profits at the group fell by £1.2m despite rising revenues.
Chairman Carlo Distefano opened his first restaurant in Temple Street, Birmingham, in 1992, and the group now operates 21 restaurants under the San Carlo, Cicchetti, Fumo, Flying Pizza and Signor Sassi concepts.
It invested £3m in new openings in 2018, including increasing its London restaurants to six.
Marcello Distefano, Carlo’s son and the group’s managing director, said: “This was far and away the group’s best-ever Christmas, with record customer numbers and sales across the group.
“Whilst customers may have cut back on the high street, they continued to indulge at the dining table, enjoying authentic Italian food with family and friends.
“The results support our decision to invest significantly last year in bringing our award-winning concepts to more locations at home and overseas.”
In a full year trading update, the group reported that sales in its financial year ending September 2018 had increased 8.6% to £54.3m but said margins had come under pressure from rising costs, with underlying profit (EBITDA) falling back from £3.4m to £2.2m.
Additionally, like-for-like sales rose 4.6% in the five-week period to January 5, with more than 250,000 people visiting its restaurants during December.