Cash-rich Carluccio’s feeds its appetite for growth

Carluccio's, the Italian restaurant and deli chain, today said its cash-rich position helped it swallow up sites left empty by rivals who could not survive the downturn, providing its "strongest-ever pipeline" for new cafes.

After the restaurant group posted an 8% rise in first-half profit to £2.7 million, managing director Simon Kossoff said Carluccio's had an appetite for growth.

"Over the last 18 months a lot of our competition backed off expansion for funding reasons, and at the same time a whole bunch of independent restaurants came on the market," he said.

"We had no debt and found rents easing, especially outside of London, so it was a good time to invest."

Carluccio's has opened restaurants in Wimbledon, Exeter and Cardiff during the six months to March, taking its total British estate to
45 outlets. The company's sales rose 8% to £37.1 million during the period.

Kossoff said he expected to open five more branches this year. Looking ahead, he added: "We can see the potential to put Carluccio's on 120 stores in the UK."

Carluccio's is expecting VAT to go up as one of the deficit-cutting measures of the new Government.

Kossoff said the chain had passed on VAT hikes in the past and was likely to do so again, adding: "We'd rather there wasn't a rise but we can deal with it."

Carluccio's warned that the consumer environment was likely to remain "difficult to predict and uncertain", but said its business model, with an average spend of £13 per person, "had proved extremely resilient".