June 8, 2020 / 6:37 AM / 2 months ago

Frankie and Benny's owner seeks to restructure restaurant leases

(Reuters) - Frankie and Benny’s owner Restaurant Group Plc (RTN.L) confirmed on Monday it was in talks with its landlords regarding potential restructuring options for its leisure estate, as it struggles with financial pressures following coronavirus lockdowns.

The company’s announcement comes after a Reuters report last week citing a source familiar with the matter that said it plans to permanently close 100-120 stores, putting up to 3,000 jobs at risk across the UK.

“The casual dining sector was already facing significant challenges prior to the onset of Covid-19, with overcapacity and significant cost pressures,” the company, which operates over 650 restaurants and pubs in the UK, said.

The company, whose shares have fallen more than 55% so far this year, said its Wagamama noodle chain, airport concessions and pub operations are not affected by these discussions.

The closures will mostly affect Frankie and Benny’s outlets, the source said last week.

In April, the company said it expected a 50% slide in 2020 sales, assuming all its restaurants and pubs remain closed until the end of June, and raised about 57 million pounds ($72.30 million) through a share placement.

Reporting by Tanishaa Nadkar in Bengaluru; Editing by Rashmi Aich

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