March 8, 2018 / 5:16 PM / 3 months ago

Franco Manca restaurant owner hit by British belt-tightening

March 8 (Reuters) - Franco Manca and The Real Greek owner Fulham Shore warned on profit on Thursday as fewer people ate at is restaurants, causing it to curtail expansion plans.

Jamie Oliver, Byron, Carluccio’s, Prezzo and other mid-market British chains have struggled to attract cash-strapped customers, while a weak pound has increased their costs.

Shares in Fulham Shore, which was founded in 2012, fell 20 percent after it said its restaurants were serving fewer customers than last year, with higher operating costs.

“We are operating in an uncertain economic outlook for both the UK and the restaurant sector in particular,” it said.

“We will bring forward our plans only to fund new restaurant openings from our internally generated free cash flow by reducing the number ... for the coming year,” it added.

Britons have been feeling a squeeze on spending due to higher inflation and lower wage growth, boosting the performance of takeaway providers.

Fulham Shore expects higher full-year turnover for the year ending March 25, but said earnings before interest, taxes, depreciation and amortisation (EBITDA) would be below forecasts.

It reported headline EBITDA of 7.1 million pounds ($9.8 million) for the year ended March 26, 2017.

Fulham Shore, which listed on London’s junior market in 2014, operates 41 Franco Manca pizzerias in Britain, with pizza prices starting at 4.95 pounds. It has one franchise in the island of Salina in Italy and 16 The Real Greek restaurants. ($1 = 0.7231 pounds) (Reporting by Noor Zainab Hussain in Bengaluru Editing by Alexander Smith)

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