Loungers, the renowned café-bar chain, has reported a significant rise in profits this financial year, marking a milestone for the company.
With revenues climbing and expansion plans underway, they have managed to enhance their market presence notably.
Loungers has achieved record financial results for the fiscal year, marked by an expansion of 36 new locations across the United Kingdom. This impressive growth has facilitated an operating profit of £20.3 million, a substantial increase from the previous year’s £14.7 million. The company’s brands, including Lounge, Cosy Club, and Brightside, have seen an increase in revenue by 24.7% to £353.5 million, with a like-for-like sales growth of 7.5%.
Following the successful opening of seven Lounges sites since the end of the financial year, Loungers aims to reach a remarkable target of 665 UK sites.
Described as “conservative” by the company, this goal underscores their ambitious growth strategy and commitment to strengthening their foothold in the hospitality sector.
The company’s success can be attributed to its ability to navigate decreasing inflationary pressures and leverage increasing scale.
These factors have enabled Loungers to make “good progress” in re-establishing its pre-Covid profit margins. The strategic approach towards managing costs and enhancing operational efficiency has played a crucial role in their profitability.
Nick Collins, the chief executive, stated, “This has been another year of outstanding strategic, operational, and financial progress for Loungers.”
Loungers has invested approximately £39 million into high streets and communities, illustrating its commitment to regional development.
The company has also created 1,200 new jobs over the year, showing its dedication to not only growing its business but also contributing positively to the local economies.
Such efforts have demonstrated the capacity of the hospitality sector to make both economic and social impacts on areas that often lack significant investment, according to Mr. Collins.
Despite these positive strides, Loungers is advocating for changes in the business rates system, which their CEO describes as a “wildly unfair tax burden” that needs urgent reform.
Collins emphasised the importance of reforming the business rates system to further enhance the sector’s growth potential.
Aligning with social responsibility goals, Loungers collaborates with Babbasa, a Bristol social enterprise, to encourage young people from disadvantaged backgrounds to enter the hospitality industry.
This initiative follows the business’s completion of Babbasa’s ‘Inclusion Healthchecker’, which suggested methods for improving inclusivity. Such collaborations are pivotal in making the workforce more representative of the local population.
This partnership reflects Loungers’ commitment to diversity and social impact beyond mere business operations.
Mr. Collins expressed confidence in Loungers’ future trading prospects, backed by an improving macroeconomic environment, including declining inflation and falling interest rates.
These conditions are expected to further bolster the company’s performance and support its expansive growth plans.
Loungers’ remarkable financial results and strategic expansion highlight its robust position in the market.
With continued investments in both infrastructure and community, the company is poised for ongoing success, while advocating for crucial policy reforms.
