Tasty shares surge 14% on £2.5 mln insurance settlement

Investing.com -- Shares of Tasty Plc (LON:TAST ) surged over 14% on Thursday after the company secured a £2.5 million insurance settlement, but it also issued a warning regarding “disappointing” trading performance during the critical Christmas period.

The Group, which operates restaurants in the casual dining sector, said in a statement that it had reached a full and final settlement with its insurer for £2.5 million. 

After accounting for creditor costs and legal expenses, the net amount payable to Tasty will be about £1.5 million. 

The settlement relates to a claim for losses arising from a breach of an insurance contract in 2020. 

The insurer is expected to pay the settlement sum within 21 days, providing a much-needed financial cushion for the company.

Tasty also cautioned about the performance of its business in the latter half of 2024. In a stock exchange filing, the company said that trading had been particularly challenging during the key December period, which is typically crucial for the casual dining industry. 

The casual dining market has been grappling with various headwinds, including reduced consumer confidence, rising inflationary pressures on food costs, and increased labor costs due to the rise in the National Minimum Wage and upcoming increases in National Insurance contributions for employers in April 2025.

Tasty had already reported a period of restructuring and operational changes in its interim results in September 2024, and these challenges were compounded by the disappointing festive season. 

Source: Investing.com