StockMarketWire.com - Wagamama and Frankie & Benny's owner Restaurant Group warned on profits and said it was discussing convenant 'holidays' with its lenders, as the coronavirus hammers its sales.

Like-for-like sales in the last two weeks had plunged 12.5% and the company predicted they would fall 25% in the 2020 financial year.

The guidance assumed like-for-like sales across the leisure, pubs and Wagamama businesses sinking 68% in the second quarter, including 10 weeks of shutdown, before normalising through the second half.

Annual adjusted earnings before interest, tax, depreciation and amortisation was expected at between £95m and £105m, with leverage of between 2.2 times and 2.5 times.

'The group will work with lending banks to seek covenant holidays throughout 2020 in order to preserve maximum flexibility to operate the business through this challenging period,' Restaurant Group said.

'Clearly the situation is evolving rapidly and there is no certainty around the severity and duration of the impact on the business.'

'The company is continuing to consider its funding options, both equity and debt, on an ongoing basis.'

'The Restaurant Group is fundamentally a resilient business with a strong asset base, substantial cash liquidity and strong cash flow.

'The group has a strong management team in place and the capability to adapt and respond quickly to changing market conditions.'

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