Casual Dining Group is the new name for the group behind household restaurant brands Bella Italia and Café Rouge. The new company name reflects the transformation from what was Tragus Group to a focused, highly capitalised and growing restaurant business.
The announcement of Casual Dining Group’s new identity coincides with the posting of the last set of full-year accounts for what was Tragus Group, for the period to 1 June 2014.
- New senior leadership team in place
- Business refinanced; debt reduced from £258m to £91m
- EBITDA of £33.3m; group now highly cash generative
- Casual Dining Group in rapid growth phase; on track to open 70 new restaurants
- 3,100 new UK jobs to be created over the next three years
- Brand evolution programme underway; 160 existing restaurants to be refurbished
Sales growth trend gaining momentum; strong Christmas and New Year delivered Commenting on the latest developments, Steve Richards, CEO, said:
“Following what has been a transformational period for the business we are delighted to mark the beginning of an exciting new era with a fresh identity to reflect our vision and plans. The Casual Dining Group has been successfully created as a substantial growth platform that comprises many of the best restaurant sites in the UK. We are now in a strong position to continue to develop and invest in our restaurant brands and aggressively grow the business.”
Martin Robinson, Chairman, added:
“The speed and breadth of change at Casual Dining Group has been dramatic, and is testament to a strong executive team led by Steve Richards. The business is in excellent shape and we can look forward to the future with confidence.”
Casual Dining Group – CEO update from Steve Richards
“On any measure, it is has been a period of significant progress for the company, amid a far- reaching change programme that has touched every part of the business. I am delighted to be able to provide an update for colleagues and stakeholders, which serves to capture the key points, coinciding with the posting of Tragus Group’s last set of accounts.
“A consortium of new investors, including funds managed by affiliates of Apollo Global Management (LLC) and York Capital, took control of the group in April 2014 and undertook a detailed strategic review, identifying 200 sites within the key Bella Italia and Café Rouge brands on which the group would focus and invest in, going forward. As a result, the group identified some selective disposals from the Bella and Rouge estates, executed a successful CVA and concluded the sale of the Strada restaurant business after the year-end, in September 2014.
“Following this significant re-organisation, the group refinanced and is now highly cash- generative. The new business has embarked on a large-scale investment programme to revitalise its brands and to drive substantial growth – both organically and by way of acquisition.
“During the period to 1 June 2014, sales within the core business were up 3.8% to £193.1m, and EBITDA (earnings before interest, taxation, depreciation and amortisation) before exceptional costs in the 52 weeks to 1 June 2014, was £33.3m.
“Since the financial year-end this improving trend has continued, with performance in line with budget and expectations. During the key seven-week festive trading period ending 31 December, 2014, total sales were up 4%.
“It is well-documented that prior to its re-organisation in July 2014, the Tragus Group faced a number of legacy issues that threatened the long-term future of the business. It is pleasing that with new investors, new management and an extensive re-shaping of what was Tragus, all these issues have been addressed and the long-term future of the business secured.
“As part of the restructuring work to right-size the Tragus business and its balance sheet, in the financial year to 1 June 2014, the profit and loss account incurred a number of one-off extraordinary non-cash charges. These related to an impairment of goodwill and tangible fixed assets, and an annual goodwill amortisation. Combined with some exceptional costs relating to the restructuring of the group, these exceptional non-cash items resulted in a negative P&L adjustment for the group. These balance sheet adjustments have been made in line with UK GAAP accountancy rules and are not a reflection of the profitability of the group going forward. With EBITDA of £33.3m and vastly reduced debt levels, the group is highly profitable and highly cash-generative.
Property and investment
“Over the next few years, the group intends to open a total of 70 new restaurants – of which 30 have exchanged contracts or are at advanced stage of legal negotiations. This opening programme, the financing for which is in place, will create 3,100 new jobs in the UK. In addition, 160 existing venues will be completely refurbished.
“Beyond the UK, we have opened our first Café Rouge in Dubai, in partnership with a local operator. Given the enduring popularity and widespread appeal of our core restaurant brands, the Board is confident that international expansion offers a significant growth opportunity for the business.
“During 2014 a new senior leadership team was established. These new appointments significantly enhanced the leadership team and complement an existing experienced group.
“Current trading is in line with budget and we can look forward to the future with confidence. Last year was about right-sizing the company – its cost base, footprint and balance sheet and returning the core business to growth. As we move forward as Casual Dining Group, the business is in great financial shape to invest in our people, our products and our restaurants.
The Casual Dining Group
The Casual Dining Group is one of the largest casual dining restaurant operators in the UK, with over 200 sites (as of February 2015) across the country. The Casual Dining Group operates primarily under the Café Rouge and Bella Italia formats in the UK.
Café Rouge is a chain of restaurants with the look and feel of a classic Parisian bistro and a menu which includes a number of bistro classics such as steak frites and tarte tatin. Café Rouge is predominantly a high street brand but also operates successfully in shopping centres, airports and transport hubs. The first of many planned international sites recently opened in Dubai.
Bella Italia is an all-day, Italian trattoria popular with families and regular diners. Its restaurants are in prime locations on the high street but are also to be found in landmark locations on UK leisure park sites. In addition to classic pizzas and pasta its broad menu also includes a range of grilled main courses and salads.
The portfolio also includes 20 concessions at Heathrow and at Center Parcs. The Casual Dining Group also operates brasseries under the brands Huxleys, Belgo, Oriel, La Salle and Amalfi.
Casual Dining Group Management Team
CEO Steve Richards – an experienced CEO, who prior to leading the buyout and restructure of what was Tragus Group, was CEO of Novus Leisure, which was successfully sold for £100m in 2012. Before Novus, Steve was Managing Director of Spirit Group Ltd which was sold in 2006 for £2.7bn. Steve has held similar senior roles at a number of leading leisure firms including Allied Domecq PLC, Greenalls Group PLC and Scottish & Newcastle PLC.
Chairman Martin Robinson – an experienced operator and sector investor, who is currently chairman of Center Parcs and is supervising board director of Disneyland Paris. Martin has also chaired the boards of Holmes Place, Health Club Holdings and Wagamama, and has served as the senior independent director of Regus and a non-exec at Perry’s. He is also currently chairman of children’s education business Inspiring Learning.
Chief Financial Officer Tim Doubleday – an experienced CFO with a background in corporate finance and private equity, who has held major CFO roles within the leisure and hospitality sphere – including positions with contract caterer Elior and Principal Hayley Hotels.
Managing Director (Business Development) Andrew Walker – former director of customer service delivery at Virgin Atlantic, who previously served in a number of roles during 12 years at Pret A Manger, including five years as UK managing director.
Managing Director (Café Rouge) James Spragg – a highly-regarded casual dining operator who is a former managing director of Pizza Express and previously served as managing director of Strada, returning the brand to growth prior to its sale. He has also held senior leadership roles at Whitbread Restaurants, TGI Friday, Pizza Hut and Novus Leisure.
These new appointments significantly enhanced the leadership team and complement an existing experienced group that includes:
Managing Director (Bella Italia) Nick White – an established figure at the group who has in the past 18 months overseen the re-invigoration of the brand. Prior to CDG, Nick held senior positions at The Restaurant Group, Yum! Brands and Whitbread.
Property Director Phil Derbyshire – a long-serving member of the leadership group, Phil was part of the team that formed Tragus from Whitbread in 2002. As such he worked with all four private equity owners of what was Tragus, opening 150 restaurants in that period, prior to which he was head of asset management at Whitbread’s restaurant arm.