Las Iguanas, the fast-growing operator of 28 authentic Latin American restaurants throughout the UK, is leading the way in both developing and benefiting from the growing appeal for Latin American cuisine in the UK. It has posted strong results for the 53 week period to 31 March 2012, an encouraging pre-Christmas trading update, as well as indicating its continuing expansion plans.
Summary results
- Total sales grew by 13% to £33.8 million (2011: £30.0 million)
- Operating profit increased 42% to £1.7 million (2011: £1.2 million)
- Positive like for like sales growth (52 weeks vs 52 weeks) which increased 1.8% year on year
- Underlying operating profit increased 12% to £3.3 million (2011: £2.9 million)
- Underlying cash flow of £3.7 million (2011: £3.1 million)
- Three new sites opened during the year: Westfield Stratford, Sheffield Meadowhall and Newcastle
Post 31 March 2012 year end
- A further three sites have opened in the current year in Cambridge (April); Kingston (June) and Aberdeen (November); additional new restaurants are due to open in Plymouth and Wembley early in 2013
- The Group extended its banking facility with Royal Bank of Scotland to £15.7 million in March 2012 providing the funding required to grow the Group to 36 sites
- Like for like sales growth of +1.6% for the 35 weeks to end November 2012, ahead of Coffer Peach sector comparison
- Positive sales growth year to date and strong pre-Christmas group bookings year on year which show double digit like for like growth for the Christmas period
- Awarded Investors in People gold accreditation (July 2012)
Las Iguanas is backed by Bowmark Capital.
Eren Ali, Chief Executive of Las Iguanas, commented:
“I am delighted to report another year of progress which demonstrates good sales and profit growth, as well a further consolidation of Las Iguanas’ market leadership in authentic Latin American casual dining. This is an excellent trading performance against the backdrop of an ongoing challenging economic climate and we remain encouraged by the ongoing appeal of our brand offering in a variety of trading formats and geographic locations.
“We have continued to expand our estate nationwide and extend our geographic footprint across the UK, most notably through our recent debut in Scotland with the opening of our Aberdeen restaurant last month. Our new openings are trading well under the refreshed Las Iguanas format and will be a driver of profit in the current year.
“The current year’s performance is encouraging and we are confident of a good Christmas trading period over the weeks ahead. This, together with an excellent pipeline of new sites, leaves Las Iguanas well positioned to deliver another period of further progress.”
Operations
Las Iguanas currently operates 28 authentic Latin American restaurants throughout the UK, with four sites in London and 24 restaurants in regional cities nationwide.
Whilst benefitting from a broad demographic appeal, the Group focuses on serving its core target market of 24–35 year pre family customers and is the market leader in authentic Latin American casual dining in the UK.
With a distinctive brand offering high quality food at an affordable price point, the Las Iguanas menu features a diverse range of authentic Latin American dishes. All of Las Iguanas’ dishes are freshly prepared onsite using authentic, regional ingredients and the Group’s restaurants successfully evoke a fun and vibrant atmosphere, synonymous with the carnivals of Latin America.
As such, the Group is uniquely positioned to capitalise on the growing appeal for Latin American cuisine in the UK.
Predominantly a restaurant brand, Las Iguanas also has a strong premium drinks, cocktail and bar offering. The Group benefits from higher drinks spend than many restaurant brands with a food/drinks split of 67:33.
During the period, the Group opened three new restaurants in Westfield Stratford, Sheffield Meadowhall and Newcastle, further expanding the Group’s geographic footprint nationwide which now extends from Portsmouth to Aberdeen and Cambridge to Cardiff. New openings are trading well and exceeding management’s ROCE targets of 40%.
Elsewhere across its portfolio, Las Iguanas has further invested in the evolution and design of its brand which is delivering above average returns on capital. A “new look” restaurant format was launched in Stratford to showcase a more relaxed daytime offer together with new corporate branding which was developed to modernise and reinforce the brand’s premium nature and fresh food roots; this new look has since been further developed at the Cambridge and Aberdeen sites.
Additionally, the Group successfully secured an £15.7 million extended banking facility from Royal Bank of Scotland in March 2012 and now has the funding in place to expand its estate to 36 sites.
Current Trading and Outlook
Las Iguanas has continued to trade well in the current year with like for like sales growth up 1.6% for the 35 weeks to end November 2012. Christmas is a key trading period for the business and pre-booked Christmas and New Year party sales are well up on the same period last year, showing a double digit like for like increase.
Looking further ahead, the Group has a strong pipeline in place with ambitions to expand its portfolio of restaurants to 40 by 2015
Whilst the challenging consumer trading outlook remains, we anticipate that the remainder of 2012 into 2013 will continue to see Las Iguanas make further progress across all aspects of its business and management remains confident of another year of strong profit growth.