Pizza Express this morning reported that its global business is now worth £543m in annual sales, but said that tough market conditions in the UK had weighed heavily on its profits.
Overall revenues for 2018 grew 1.6% on the previous year, but only crept up 0.1% in the UK & Ireland on a like-for-like basis, excluding the impact from adverse weather (down 1% unadjusted).
The chain said that sector-wide cost headwinds in the UK and more challenging conditions in some of its less mature international markets resulted in group EBITDA falling 15% to £80.2m.
The bulk of Pizza Express’ store growth has come internationally, with 26 company-owned restaurants launched in the past year. International markets now generate just under 20% of group sales.
Jinlong Wang, group chairman and CEO of PizzaExpress, said: “Although 2018 was a challenging year for the casual dining sector, we are pleased with the overall group revenue growth of +1.6%. Sector-wide labour and property cost increases in the UK combined with more challenging conditions in some of our less mature International markets resulted however in a 15.3% decline in Group EBITDA.
“In the UK and Ireland, the unexpected snow in the first half of the year and sustained period of heat in the second half impacted the whole industry. Outside these periods of extreme weather, we were pleased with our resilient underlying like-for-like sales growth of +0.1%, which includes a strong Christmas performance.”
Mr Wang said the chain has invested around £1m into its business over the past year to improve its brand proposition and digital offering.
It also opened a new Global Innovation Centre in London, as reported exclusively by FEJ HERE, which has enabled it to accelerate the development of new products such as its vegan and gluten free menus as well as seasonal ranges.
“We opened four new company-owned restaurants in the UK and Ireland in 2018 and are particularly excited about the recent re-opening of our Langham Place restaurant in London,” he continued. “The restaurant showcases our new brand proposition with a theatre kitchen and defined bar space creating a new sociable pizzeria.
“Looking forward, while we expect both the UK and International markets to remain competitive we are confident that our focus on customer-led innovation and investment in our brand and our people will put us in a strong position to succeed in this environment and continue to deliver a resilient performance.”