Cooking up a storm
Article Date: Dec 20 2006Each brand has its own management team with its own identity, which represents a
high overhead at this stage of the business: ‘If you have ten units in a chain, but want 50, you have to put the management in now and pay them. If you are at £10 million then you have to put in the management for sales of £25 million.’
Analysts are expecting turnover to reach £45 million this year with a rise of 50 per cent in the following year. Although it has had a strong run recently, Clapham House is still trading at a discount to its competitors, mainly because it is the fastest-growing company in its sector.
He says: ‘If we trip up, it hurts. The analysts are a bit fixated on numbers in the short term. If you say you are going to open 20 units and you only open 16, then they will say it is all going horribly wrong. In fact, you have done rather well and might open 24 the
next year.
‘Our message is that the most important number for us is cash generation. We are currently expecting £4.5 million this year and £8 million in the following year.’
Beyond making money for his shareholders, Page is clear about his own motivation: he wants to prove that Pizza Express was not a one-hit wonder. He says: ‘We like the business model of rolling out restaurants to the public across the country. We are still on a mission to make eating out decent and affordable.’
