The Restaurant Group says its airport restaurants are growing faster than passenger numbers due to longer dwell times and less competition – but it has had to significantly restructure that side of its business.
Covid-19 has hit the travel sector incredibly hard with short-notice changes to quarantine arrangements and passenger volumes remaining significantly down on last year.
The Restaurant Group has implemented a measured reopening programme as airport travel rebuilds, with a slower reopening rate than the rest of group, focusing on positive EBITDA delivery in each site reopened.
It currently has 16 sites open with like-for-like sales declining 58% in the first half of the year – a figure that it says is actually 15% ahead of passenger volume decline.
“Passenger dwell time has increased at airports due to increased security measures, which has increased customer spend per head,” the company stated. “Additionally there is currently reduced competition operating, benefitting operators such as us who have re-opened.”
The Restaurant Group said it is not anticipating passenger numbers to significantly improve until 2022, which has led to the restructuring of its estate and the closure of 50% of its sites.
“The resulting portfolio has the potential to achieve a higher average EBITDA and EBITDA margin per outlet, on a flexible rental structure and deliver strong returns when air passenger growth returns to more normal levels of activity,” it said.