Revolution Bars to close six bars as 10pm curfew bites
Revolution Bars Group
1.45p
16:55 25/04/24
Revolution Bars announced plans on Tuesday for a company voluntary arrangement and said six bars were set to close as revenues take a hit from the 10pm coronavirus curfew.
FTSE AIM All-Share
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16:50 25/04/24
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The company had previously reported that comparable venue sales in the eight weeks from when it began reopening its bars on 4 July to 29 August were 72.5% of last year. However, in the last five weeks to 24 October and due to the government’s imposition of a 10pm curfew, sales have reduced to 49.4%. Revolution also said local lockdowns and more severe operating restrictions were affecting its reopened bars.
The group said it expects to exit six Revolution bars and obtain "materially improved" rental terms on seven others.
Chief executive Rob Pitcher said: "Throughout this extended period of distress caused by Covid-19, the group has sought to prioritise the health and well-being of its staff and customers, minimise its cash consumption, maintain good levels of liquidity to ensure its ongoing viability and to be in a position to take advantage of opportunities that may arise once restrictions are lifted.
"The CVA proposed by the group's Revolution Bars Limited subsidiary entity, if agreed by landlords, is another proactive step to lower outgoings to help safeguard the future of the group and improve long-term performance."
Revolution also said that given the latest government restrictions, its trading outlook is uncertain and it now expects the important Christmas trading period to be "severely compromised". Any return to near normal levels will not be possible before next Spring at the very earliest, it added.
"When trading conditions return to more normalised levels it will be crucial for the group to be able to recover quickly, return to cash generation and be appropriately structured for the long-term.
"Accordingly, the board believes that it is in the best interests of all stakeholder groups for it to now propose a restructuring of certain of the group's property interests through a CVA of one of its subsidiary entities RBL."
At 1045 GMT, the shares were down 4% at 9.50p.
Broker Peel Hunt said: "Current trading conditions are not profitable or cash generative, however, we believe RBG is continuing to take the right actions to preserve cash, and it retains the support of its lenders. We expect to update forecasts after the outcome of the creditors meeting is known."