Gourmet Burger Kitchen sales improve after restaurant closures
The casual dining brand’s performance has improved since undertaking a company voluntary arrangement.
Gourmet Burger Kitchen sales have improved since the chain closed several underperforming sites, its owner has said.
Famous Brands, the South African owner of the burger restaurants, said like-for-like sales in the 16 weeks to February 24 were up 4%, ahead of the market average.
In the full 12 months to February 28, like-for-like sales were down 4.2%.
Overall sales were down 7% reflecting the reduced number of stores.
But underlying performance improved in the second half, when like-for-like sales were up 1.6%, compared to a decline of 9.7% in the first half.
GBK launched a company voluntary arrangement (CVA) last year, getting the green light from creditors in November to go ahead with 17 restaurant closures.
Combined with some closures which took place separately to the process, a total of 24 GBK locations shut their doors during the period.
The brand said management is “optimistic” that the actions taken are gaining momentum and being reflected in the improved results.
A one-off cost of £18.3 million will be incurred for the year, as the costs of write-downs on empty sites and professional fees for the CVA.
GBK was one of a long line of casual dining firms to shut restaurants last year, leaving gaps in high streets and shopping centres.
Gaucho, Carluccio’s, Prezzo, Byron and Jamie’s Italian all fell on hard times as costs have rocketed off the back of the Brexit-hit pound, business rates and higher staffing costs.
More recently, Giraffe and Ed’s Easy Diner announced their intention to close 27 sites and seek rent reductions on 13 more. A vote on the proposal is scheduled for March 21.