Hospitality squeeze hits Revolution – eight venues to close

Revolution Bars Group is to shut down eight of its “least profitable bars” to reduce future site losses. 

The closed bars are: Revolution Bars in Beaconsfield, Derby, Reading, St Peters Liverpool and Wilmslow, Revolución de Cubas in Sheffield and Southampton and the Playhouse in Newcastle-Under-Lyme. 

Negotiations for five of the eight bars had already begun for them to be transferred to other operators or their leases rescinded, the company said.

The company also said rising wage costs were a factor. “The prospect of the statutory 10.8% increase in the national living wage in April 2024 increases the challenge,” the company said.

Rob Pitcher, chief executive of Revolution Bars Group, said: “We have had the best festive trading period for four years with all of our brands recording positive like for like sales and Revolución de Cuba being the standout performer.

“However, our younger customers are still feeling the disproportionate effect of the cost-of-living crisis and the national living wage will increase materially in April 2024. Therefore, we have taken the difficult yet ultimately beneficial step for the Group to close several bars which are unprofitable.

“Our teams do a terrific job in making guests welcome and giving them a great experience and again we have demonstrated that when our customer base can afford to do so, they are choosing to celebrate with us, and we have delivered record levels of guest satisfaction. This should bode well for the future,” he said.

The company is currently working through redeployment plans to enable those team members affected to be offered alternative employment elsewhere across its 58 bars and 22 pubs.

The AIM-listed company said it had traded positively over the festive season but said its mostly younger customers are “disproportionately impacted by the current macro-economic conditions.” 

A statement to the stock market this morning (5 January 2024) said: “Group like-for-like sales for H1, including New Year’s Eve, continued to demonstrate an improving trend, but remained negative at -2.8%. As usual, the Group expects to announce its H1 pre-close trading update on 24 January.

As at 4 January 2024, net debt was £18.3m, below that reported in July 2023.