Losses widen at IRC
INDIVIDUAL Restaurant Company described its trading performance for 2010 as “pleasing” despite announcing a drop in sales and a doubling of pre-tax losses this morning.
The Manchester-based company, which operates 11 Bar & Grill-branded restaurants and 22 Piccolino outlets, saw its sales drop by £2m to £51.3m while its pre-tax loss widened to £1.8m, (2009: £872,000 loss).
Chief executive Steven Walker said that when a number of adverse one-off factors were taken into account, such as the poor weather in December, the company experienced strong like-for-like sales at the end of the year which have spilled over into the first quarter of 2011.
The firm has also managed to cut its central costs by £400,000 due to a reduction in its wage bill and said that both brands are continuing to trade “robustly” across the country.
However, it paid out £1m in rents on sites which it has either closed or is yet to open, but added that it expects to sell two of these (an outlet in Wandsworth and the former Zinc restaurant in Birmingham) by the end of June.
The firm continued to pay down its debt, with net debt reducing to £11.7m at the year-end. It also successfully refinanced its £18.5m loan facility until January 2013.
It has also spent a further £1.4m on restaurant upgrades, as well as a new centralised database which it said gives it “a greater understanding of the guests who dine throughout the estate each week”.
Chief executive Steven Walker said: “We remain cautious as to the future trading environment. Like-for-like sales growth, whilst positive, has slowed in March and in common with most of the industry, we are also experiencing cost pressures.
“Nevertheless I remain confident in the robustness and trading potential of both brands.”
