Takeover target Gondola Holdings said more restaurant openings were on the menu on Thursday after it posted a 4.1 percent rise in annual like for like sales.

PizzaExpress owner Gondola, which media reports say is close to recommending a bid from private equity group Cinven, said like for like sales in the year to July 2 rose 4.1 percent to 360.5 million pounds, with a 7.1 percent gain seen in the 11 weeks to September 17.

The recent sales growth was partly skewed however, after bombings in London last year put off the capital's diners.

Our strong performance reflects the Group's focus on our 'restaurant basics strategy', Chairman David Ross said in a statement.

At the same time, effective management of our cost base has enabled us to maintain profit margins in the face of challenging industry wide cost pressures, he added.

Pizza and pasta specialist Gondola, which also owns the ASK and Zizzi restaurant chains, said earnings per share climbed 5.3 percent to 24.9 pence, adding it was raising its targets for new store openings to 25 to 30 stores.

We've got a pretty healthy pipeline. Last year the openings were a bit back end weighted, we expect the opening programme to be much more even this year, Chief Finance Officer Chris Heath told Reuters.

We are looking to expand all over the UK and Ireland.

Analysts said the results were as expected.

Results were in line with what we were going for, strong like for like sales performance as expected and good to see them maintaining margins. said Investec analyst Joseph Thomas.

The stock was up 0.75 percent in early trade at 403–1/2 pence by 08:15 GMT (9:15 a.m British time), valuing the business at around 540 million pounds.

Pretax profit stripping out costs of the firm's flotation and financial restructuring last year reached 48.7 million pounds from a pro forma 46.2 million a year ago.

The firm set a total dividend of 7 pence per share for the period since the IPO, saying it was equivalent to 11.1p per share for a full 52 week period, at the top end of its dividend payout policy of 35 to 45 percent of earnings per share.


The chain which was floated on the London Stock Exchange at 320 pence per share last November after being taken private in 2003 saw its shares jump earlier this month when it said it had opened its books to Cinven.

The private equity firm approached the British restaurateur with a possible offer worth 559 million pounds, or 415 pence per share, and would include any dividend announced.

It has received irrevocable undertakings from two Gondola shareholders TDR and Capricorn who own 25.1 percent of Gondola between them to sell their stakes for 400 pence a share including any dividends.

Investec's Thomas said he expected the deal to go through.

I do expect them to go through with it, you've seen the document yourself, it looks like it.

Despite being a takeover target itself, Heath said that Gondola still had an appetite for acquisitions.

It's inevitable given the fragmented nature of the market that at some point consolidation will take place and we wouldn't want to be left out of that.

If it (an acquisition) adds to what we do and adds value to our business of course we would be interested, he added.