Revolution Bars pinning hopes on upgrading current sites
Bosses want to focus on improving its Revolution and Revolucion de Cuba bars before opening new ones, as sales fell.
Bar chain Revolution will continue upgrading and improving its current sites before opening new ones, to avoid running up higher debts, the company’s chief executive has said.
Rob Pitcher, who joined the group last year, said he plans to refurbish 15 bars, which trade as Revolution Bars and Revolucion de Cuba, having updated eight in the last year at a cost of £1.4 million.
The costs mean it sank to a pretax loss for the year to June 29 of £5.6 million, growing from a £3.6 million loss a year earlier, although on an underlying basis – which excludes one-off costs – this was a profit of £11 million.
We will utilise surplus cash to reduce debt to such an extent whereby any return to expansion of the estate will be self-funding Rob Pitcher, chief executive Revolution Bars
Sales across the group’s 79 bars grew 6.7% to £151.4 million thanks to five new sites, but on a like-for-like basis sales dropped 3.5%.
The company pointed out that during the year like-for-like sales did improve, going from minus 4% in the first half to minus 2.9% in the second.
In the first quarter of the current financial year like-for-like sales are up 0.7%, it added.
Sales were also affected despite weak comparisons with last year, due to the summer heatwave and the Fifa World Cup sending customers to rival bars showing the football.
Mr Pitcher said: “A return to positive like-for-like sales in Q1 of the current year reflects the hard work by the team in stabilising the business.
“We will invest in our team, our brand experience and our estate to continue to improve performance. Our progress demonstrates that our business is delighting our guests, and is both profitable and cash generative.
“We will utilise surplus cash to reduce debt to such an extent whereby any return to expansion of the estate will be self-funding.”
He also hopes to have a successful Christmas, revealing bookings for the festive season are already 15% up on the same point last year.
Debts stand at £14.9 million compared with £11.5 million a year ago. A dividend has been ruled out until debts are paid down.