Shares in neighbourhood cafe operator Loungers (LGRS:AIM) fell 2.8% to 258.5p despite it beefing up its finances ahead of the reopening.
The firm has agreed a 12 month extension to its banking facilities as well as covenant testing waivers ahead of opening up its estate.
An incremental revolving credit facility of £15 million, put in place last April has been extended to October 2022 and provides the company with £25 million of total facilities. Quarterly covenant testing has been waived until 26 December 2021.
Loungers plans to open 47 of its English sites on 12 April and five sites in Wales on 26 April for takeaway and outside trading in line with respective Government roadmaps.
All the company’s English sites are expected to reopen by 17 May while the Welsh sites will reopen later in May, subject to confirmation by the Welsh government.
When the firm’s sites reopened last year, they significantly outperformed the hospitality sector with like-for-like sales growth of 25.1% over the 13 weeks to 4 October.
RESUMPTION OF SITE ROLL-OUT
The extension of banking facilities and £8.3 million equity raise last April have given the company financial headroom to resume its new site rollout of 25 sites a year.
The company will open four new Lounge sites in Wolverhampton, Stourbridge, Welwyn Garden City and St Ives by 26 May, bringing the total estate to 172 sites.
Chief executive Nick Collins said, ‘The most recent lockdown has given us a real opportunity to build a fantastic pipeline of new sites in what is undoubtedly a tenant-friendly environment.
‘We expect to trade well once the estate is fully re-opened, particularly with our strong coastal presence as we look forward to a summer of staycationing.’
