Restaurant chain Cote has access to a £20m CAPEX facility it can draw on to fund the launch of new restaurants in the UK, its annual accounts reveal.
The company opened 15 sites last year on the way to growing sales by 12.5% to £121m and it has negotiated the financial resources to maintain the pace of new launches in its current year.
Director Strahan Wilson said the French brasserie chain’s focus remains on the UK market, with the £20m banking facility ring-fenced for helping to grow the business and open new restaurants.
In addition, the chain has pledged to use retained earnings to finance some of the fixed assets expenditure expected with these new openings. “The company expects to open a similar number of sites in the next financial period,” he said.
Despite the strong sales growth, Cote saw EBITDA slip from £20.1m to £17.9m for the 12 months to the end of July 2016 while net profit fell from £12.4m to £9.7m.
The chain operated 86 restaurants at the end of its last accounting period, but if it hits its targets it will exceed 100 sites this year.
Wilson said competition for new sites remains “fierce” and acknowledged that selecting the wrong locations can impact on profitability.
But he said the group has a “dedicated and experienced” acquisitions team that presents reports on potential sites to the directors every week and these are reviewed by the board each month.