Revolution Bars Group – RBG – Interim Results

Revolution Bars Group – RBG – Interim Results

Revolution Bars Group plc ("the Group"), a leading UK operator of 66* premium bars, trading under the Revolution and Revolución de Cuba brands, today announces its unaudited interim results for the 26 weeks ended 26 December 2020.

*67 Bars as at 26 December 2020.

Introduction

The period on which these results report includes long periods where the Group's ability to trade was severely impacted by restrictions imposed by the Government due to COVID-19. Following stable yet challenging trading conditions during last summer, increasing levels of restriction impacted the Group's trading especially through the last quarter of the calendar year and particularly November and December. The business has been unable to trade for all of 2021.

Revolution Bars Group is excited and ready to bounce back, beginning by trading from 20 bars from 12 April 2021 and the remainder from 17 May 2021. We have taken advantage of the reduced trade periods to fine tune our brands and strengthen the engagement of our teams. We are ready to take advantage of the reduced competition and bring to life our freshly developed new concepts to the market. Our young guest base is keen to start living again, and we cannot wait to welcome back our guests and teams to create the fun and memorable experience that they know and love us for.

 

Results to 26 December 2020

H1 FY21

(IFRS 16)

H1 FY20

(IFRS 16)

H1 FY21

(IAS17)

H1 FY20

(IAS17)

Total Sales

£21.6 million

£81.2 million

£21.6 million

£81.2 million

Adjusted2 EBITDA

£(1.2) million

£12.8 million

£(5.8) million

£7.6 million

Adjusted2 (Loss)/Profit Before Tax

£(11.5) million

£2.9 million

£(9.5) million

£3.5 million

Adjusted2 (Loss)/earnings Per Share

(12.0) pence

4.4 pence

(8.5) pence

4.5 pence

Statutory Loss Before Tax

£(17.7) million

£(1.6) million

£(14.7) million

£(3.9) million

Statutory Loss Per Share

(15.7) pence

(2.9) pence

(13.0) pence

(7.9) pence

 

Key points

 

Excellent performance pre-COVID

·      Both brands were in like-for-like1 ("LFL") growth, proving ongoing relevance of our brands;

·     1.2% Group LFL1 growth in FY20 H1, continuing into 1.6% LFL1 growth in the first 10 weeks of FY20 H2 before COVID; and

·      When free to trade without Government restrictions, the Group is highly cash generative. Pre COVID-19 in FY20 H1, net bank debt reduced by £6.5 million to £8.4 million.

Effective response to lockdown - securing liquidity position

·    In July 2020, liquidity was secured through an increase in committed debt facilities from £21.0 million to £37.5 million including a Coronavirus Large Business Interruption Loan Scheme ("CLBILS") term loan of £16.5 million and a net equity fundraising of £14.1 million;

·    On 16 December 2020 the Group's bank, NatWest, postponed loan facility amortisation payments of £7.5 million originally scheduled for the end of March 2021, and £1.0 million originally scheduled for the end of June 2021;

·   Most recently, in April 2021, NatWest agreed to waive £2.0 million of amortisation scheduled for September 2021 and approved a further £3.5 million CLBILS, taking total available facilities to £40.3 million; and

·   The above provides sufficient liquidity to trade through the Government roadmap including downside scenarios.

Doing the right thing for all stakeholders

·    Increased focus on our wellbeing agenda, collaborating to provide education, events, training and activities on all aspects of mental, physical and financial health; and

·    Management team, whilst remaining on reduced salaries, have shown exceptional leadership in very challenging times, and our teams have remained committed and resilient throughout the lockdown periods, and shown courage in returning to work under extremely difficult operating conditions.

Customer demand remains strong

·     Government roadmap welcomed; the Group is planning for outdoor trading from 12 April 2021 from 20 bars, indoor trading from 17 May 2021 from all sites in England, and unrestricted trading from 21 June 2021;

·     Tickets for summer events selling out in as quick as nine minutes of release, with long waiting lists for some events;

·      Destination cities such as Liverpool, Brighton and Newcastle-upon-Tyne, are fully booked throughout July 2021 for Cocktail Masterclasses; and

·    11,969 guests booked with us in the first week we reopened the booking system for 17 May 2021 onwards.

Well positioned to capitalise on transformed marketplace

·    The Group's strategic initiatives remain unchanged and very relevant: to build guest loyalty, drive sustained profit improvement, and develop the estate;

·      Total cash rental savings agreed across the estate since the start of COVID-19 of £5.7 million;

·      Company Voluntary Arrangement ("CVA") for Revolution Bars Limited in FY21 H1 resulted in exit of five loss-making sites, with a further site exited via the CVA in the second half of FY21;

·      Our target customers, due to our focus on young adult age groups, are at lower risk from COVID health issues, and the vaccine roll-out success is giving real confidence in the Government's roadmap achievability;

·      Our marketplace is likely to be less competitive as some capacity has come out of the market;

·     Dynamic and motivated team ready to take advantage of good value expansion opportunities as improved trading conditions take hold and funding allows;

·      Two new concepts developed ready for trial once trading conditions allows; and

·      The Board believes, subject to a return to normal trading conditions, that the Group is well positioned to operate more efficiently and, longer term, achieve a higher net margin.

 

1 Like-for-like (LFL) sales are defined as total retail sales from bars that have traded throughout both the current and prior reporting periods

2 Adjusted performance measures exclude exceptional items, share based payment charges/(credits) and bar opening costs (see reconciliation table in the Financial Review)

3 Alternative performance Measure ("APM") restates FY21 on an IAS 17 basis (from an IFRS 16 basis)

Rob Pitcher, Chief Executive Officer, said:

"Prior to the pandemic the business was outperforming our peer group. This year has provided us with the opportunity to advance the business across multiple areas which will allow us to maximise our future performance and capitalise on growth opportunities as we move towards more normalised conditions. 

 

With the vaccination programme running ahead of the government's expectation and all the COVID-19 related health data exceeding even the most optimistic of forecasts, I look forward to all restrictions on personal freedoms falling away on the 21st of June and urge the Prime Minister to follow the data, not dates, and bring our 'national day of freedom' forward in line with the vastly better outcomes that have been achieved.

 

We are excited and ready to bounce back and as we move on from the pandemic, I look forward to our brilliant teams being able to create amazing memories for our guests as we open our bars and all come back together to celebrate life and each other.''

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