Electra (ELTA), which is soon to be renamed as Unbound has provided an update on the demerger of Hostmore (Click here to see our previous story on Electra’s demerger proposals), which is principally TGI Fridays but also a brand called 63rd and 1st. Subject to approval by Electra shareholders on 1 November 2021, the Hostmore demerger will be completed with its shares commencing trading on the premium listing segment of the London Stock Exchange’s main market on 2 November 2021. ELTA will be publishing a prospectus in relation to the transaction shortly. This will be available on www.electraequity.com and www.hostmoregroup.com once it has been approved by the FCA, which is expected later today, as well as a presentation.
Hostmore trading update
ELTA says that Hostmore has made encouraging progress since the resumption of indoor dining in England on 17 May 2021.
Over the 20-week period since the resumption of restricted indoor dining in England on 17 May 2021, the Group has reported like-for-like growth when compared with the same period of 2019 averaging +11.0%. On a VAT adjusted basis, the like-for-like growth of the Group when compared with the same period of 2019 was (1.0%).
In the 11 weeks since the further relaxation of Covid-19 restrictions in England on 19 July 2021, the like-for-like growth of the Group when compared with the same period of 2019 has averaged +12.1%. On a VAT adjusted basis, the like-for-like growth of the Group when compared with the same period of 2019 was 0.1%.
The Group’s net debt, adjusted to include all Covid-19 related accruals, reduced to £36.4m at the end of August 2021 from £46.0m at the end of December 2020. Cash generated from operations over the 3 complete months following the resumption of indoor dining in England on 17 May 2021 (i.e. June to August 2021) was £12.5 million. The free cash flow generated during the period of £14.1 million reflects a 103% conversion of EBITDA.
The Group opened a new TGI Fridays restaurant in Lincoln on 19 May 2021, followed by the opening of the first 63rd+1st in Cobham on 24 May 2021 and the second 63rd+1st in Glasgow on 24 September 2021. The Group plans to open a further 63rd+1st site in Harrogate in November 2021.