Wagamama owner’s shares plunge as chief exec leaves for ‘personal reasons’

Outgoing boss said decision was 'the right one for me and my family'

Shares in The Restaurant Group, owner of Wagamama, Garfunkel’s and Chiquito, dropped more than 11 per cent on Thursday after the firm announced chief executive is leaving due to “extenuating personal circumstances”.

The group said it expects that Andy McCue will remain in his role until a replacement is found.

Mr McCue said: “In recent years, we have achieved much in a challenging market. I'm confident The Restaurant Group is well positioned with the scale, talent and levers to drive profitable growth.

“While I recognise that this decision is untimely, it is the right one for me and my family. We have a strong team in the business and a clear plan which we are focused on delivering."

Debbie Hewitt, chairman of TRG, said: “Andy has brought a strong vision, developed a first-class team and laid the foundation of the company's transformation.

"Whilst we are clearly disappointed that he will not be able to provide the long-term leadership for the business, we understand and respect the decision he has made purely on personal grounds.”

Analysts said the news of Mr McCue’s departure would not be welcomed by investors, particularly coming so soon after TRG made a significant acquisition, buying Wagamama for £357m in October last year.

“While we don’t know the full story as to why Andy McCue has resigned beyond it being for personal reasons, the news will rock the ship once more at Restaurant Group,” said Russ Mould, investment director at AJ Bell.

“The company has yet to convince the market that its pricey acquisition of Wagamama was a good idea, let alone prove that the rest of its estate still has a decent future.”

Mr Mould added that Mr McCue has led a turnaround strategy over recent years, and said any replacement will need to put in a similar effort.

“A lot of effort has gone in to improving menus (or rather fixing them after it mucked up them up a few years ago), getting food to customers’ tables faster, and putting a bit of spice back in its seemingly-tired brands,” he said.

“A trading update in January would suggest this effort hasn’t been enough with a decline in like-for-like sales, albeit the broader sector has also been struggling.

“There is a risk, or an opportunity depending on how you view it, that McCue’s replacement will want to tear up the recovery plan and make some more radical changes. Whoever takes the top seat will definitely need some bright ideas to get this one-time leisure sector superstar back on track.”