City Pub Group numbers upgraded after solid first half

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City Pub Group PLC received a profit forecast upgrade for the next three years today from Peel Hunt after a reassuring trading update.


Improvements such as streamlining the supply chain, fewer menu items and expansion will drive better profits, said the broker even though it still expects like-for-like sales (LFL) fall by at least 10% in the second half of this year.


The company also announced it was acquiring a hotel in Cromer, adding to the recent acquisition of the site of a former Cafe Rouge in Bury St Edmunds and with a relatively unleveraged balance sheet can generate strong growth through more incremental expansion said Peel Hunt.


In the third quarter, LFL sales have been on an improving trajectory but even assuming minimal LFL sales growth in 2022 and 2023, the shares are attractive said the broker, which has a 160p target price.


Shares were trading at 116p today.

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