City round-up: Revolution Bars Group; B&M Bargains; Franchise Brands
The owner of Revolution and Revolucion de Cuba has announced that it will reopen all 66 venues in May and is confident of ‘pent up demand’ from customers.
Revolution Bars Group said it was feeling confident following the PM’s announcement on the roadmap out of lockdown and yesterday’s Budget which declared further support for the hospitality and leisure sector.
The group said it will initially open 20 bars on 12 April and all its venues on 17 May when restrictions will be lifted for indoor hospitality.
Revolution added that previous experience has demonstrated that when the company is able to trade without restriction, targeted for 21 June 2021 in the reopening roadmap, it is highly cash generative and profitable.
Furthermore, it anticipates that following easing of restrictions there will be ‘significant pent-up demand and the Group will enjoy a rapid rebound in trading.’
Rob Pitcher, CEO of Revolution Bars Group, said: “With the encouraging progress of the vaccination programme, clarity in the timetable to reopening, and the additional financial support measures announced by the Chancellor, the light at the end of the tunnel is getting brighter.
“Notwithstanding that good news, our industry remains on the critical list and the continued support announced by the Government is required to ensure that we can be in a position to return to growth and be a driver of national job creation once again particularly for young people who are the lifeblood of our industry and who have been severely impacted over the last year.”
Discounter B&M Bargains said revenues have remained strong despite the ongoing restrictions due to Covid.
In a trading update for Q4 for the financial year ending 27 March, the group said despite uncertainties around lockdown restrictions in the UK, ‘revenues and margins have remained strong.’
B&M now expects adjusted EBITDA for FY21 to be in the range of £590m to £620m, stated after the voluntary payment of business rates amounting to approximately £80m.
This compares to the previous range announced on 7 January 2021 of £540m to £570m.
It said group sales will shortly annualise against the elevated sales, driven initially by consumer stockpiling in mid-March 2020, and which continued throughout FY21 due to the ongoing impacts of Covid-19.
B&M said: “This, together with the unknown impact of changes to restrictions in 2021, creates significant forecasting challenges which will persist well into the new financial year.
“The safety of the Group’s colleagues and customers remains the key priority, whilst working hard to continue to meet customers’ needs.”
Franchise Brands, the multi-brand franchise business, has hailed a ‘resilient performance’ as both revenues and profits grew.
The Macclesfield company reported adjusted pre-tax profit growth of 19 per cent to £4.8m on revenues of £49.3m, which is up 12 per cent, for the year to 31 December 2020.
The group said ‘resilient performance’ followed strong growth in Q1, early and ‘decisive action’ taken during the Spring lockdown to reduce costs, and a strong recovery across the majority of businesses during the second half of the year.
Its B2C division, which closed during the Spring lockdown, resumed trading in June 2020, with a strong restart at both ChipsAway and Ovenclean.
Looking ahead, Franchise Brands said it will expand organically and by acquisition with the target of achieving run-rate revenues of £100m and adjusted EBITDA of £15m by the end of 2023.
Stephen Hemsley, executive chairman, said: “We have made a strong start to 2021 as a result of resilient sales in the B2B division, robust recruitment in the B2C division and the enduring legacy of some of the cost saving measures implemented at the start of the pandemic. We therefore look forward to the remainder of 2021 with confidence.”
A final dividend of 0.80p per share has been proposed, giving a 16 per cent increase in the total dividend for the year to 1.1p per share.