Revolution Bars remain confident despite sliding into £3.57m loss

Revolution Bars Group reported better sales for the year to June 30, but suffered an £8.7m hangover as last year’s £5.2m pre-tax profit was transformed into a £3.57m loss this year.

Sales rose from £130.467m to £141.939m.

The Ashton-under-Lyne group, which operates 76 bars, maintained its final dividend at 3.3p per share.

It said the second half was impacted by the uncertainty following corporate activity, management change, extreme weather and the FIFA World Cup.

Rob Pitcher, the new chief executive, started six days before the year end, and the group says the benefits of his new initiatives are yet to work through.

Rob Pitcher

Early last month the group also revealed that it was back in talks with Milton Keynes-based nightclubs operator Deltic over a possible acquisition, although, today, it confirmed there is no update on this matter.

Revolution also incurred exceptional items of £11.1m – including a non-cash charge of £7.8m for onerous lease provisions and asset impairments and £3.3m cash in fees and expenses relating to the period’s corporate activity – as well as £2m in bar opening costs.

The group today said its estate expansion continued throughout the period, with six new sites contributing to 8.7% total sales growth, and the new sites are achieving good overall returns.

Pre-booked Christmas sales are up 20.3%, compared with a like-for-like figure of 14%, on the same time last year, which augurs well for the second quarter which historically has contributed just under half of full year profits.

Revolution says it has a strong balance sheet and is highly cash generative.

Chief executive Rob Pitcher said: “This is a fundamentally good business which has seen significant disruption over the past year and factors outside of its control.

“The group’s strategy is sound and with a stable management team and better execution the company can rapidly return to growth.

“The performance of our new sites is encouraging, in line with our expectations and set to deliver good returns underpinning our strategic view of the business.

“Our confidence in the potential of the group is undiminished.”

He added: “There is significant potential and promise, as well as a route back to the 18 consecutive quarters of like-for-like sales growth that ended in the second half.”