Fulham Shore announces Franco Manca openings in vote of confidence for central London restaurant sector

Fulham Shore has announced new central London openings for its Franco Manca chain in an expression of confidence in the long-term central London restaurant sector.

The AIM-listed company opened a new pizza site on Waterloo's The Cut in September which “traded well until the latest lockdown" despite lower than usual footfall.

It now plans to open its 53rd Franco Manca site by Borough Market after Government restrictions are eased.

Chairman David Page said: “Absolutely [it is an expression of confidence]. We believe that within six months trade will be back to normal, and if we can pick up the sites in the next year or two, and open them for less than half what it was costing us a year ago, our return on capital will be even better."

He said that many of the sites being picked up have "everything there", as they are "unfortunately, places that have been vacated by people who have done CVAs, or have gone into administration and cut their estates down by half".

The chair said Fulham Shore, which is still nearly 70% owned by the original shareholders, has more than £25 million headroom in bank facilities to help it see out the pandemic.

Page, a former boss of Pizza Express, said: "It's [the pandemic is] taking out businesses that were overstretched before coronavirus.... These chains that expanded very quickly and were hundreds of millions of pounds in debt saw their very thin market equity slice wiped out. Most of the CVAs are big businesses.

"We are in a really good position, because we were in a good position before coronavirus happened."

The company, which is also behind The Real Greek chain and will operate 72 restaurants after the latest openings, said in a trading update: "We see more properties coming to the market at ever lower rents as a result of the current conditions in the property, retail and dining out sectors. We expect this trend to continue, and will continue to take advantage of this as and when appropriate."

Fulham Shore saw sales rise 7% to £68.6 million in the year to March 29. It was hurt at the start of lockdown due to site closures, but saw business improve between July and September.

However, the company said that "it is not possible to predict the outlook for the rest of the year given the ongoing uncertainty over the nature and length of further restrictions that the Government may impose".

Page said: "We can't make a financial forecast if we don't really know what the Government is going to do. It's out of our hands really."