Johnson rocked by Brighton Pier slump
EmBaTTLED entrepreneur Luke Johnson has suffered another headache after profits in his Brighton Pier Group crashed.
They fell by more than a quarter from £1.9m to £1.4m during the final six months of 2018 at the firm which owns the seaside city’s 120-year-old pier.
It is the latest setback for former Patisserie Holdings chairman Johnson, 57, who is the group’s chairman and largest shareholder with a 27pc stake.
Shares have fallen 58pc over the past year, knocking the value of his investment, which is now worth £4.4m, compared with £10.4m 12 months ago.
Business has been hit by rail disruption which has dented visitor numbers to the resort.
The group also owns a string of bars and indoor mini-golf sites across the UK. Sales edged up 3pc to £16.5m during the period.
anne ackord, chief executive at Brighton Pier Group, said: ‘Rail network disruptions to and from Brighton continues to affect the pier, which is disappointing. However, once the engineering works are complete they will be of great benefit to future visitors travelling to the city and consequently to our Brighton businesses.’
a former Brighton resident, Johnson snapped up the Victorian pier in 2015 for £18m.
at the time he said: ‘There is something curiously romantic about piers in the British imagination that even affects hardheaded businessmen.’
He has built a name for himself as one of Britain’s most successful restaurant entrepreneurs, credited with turning around Pizza Express, where he was chairman, co-founding restaurant chain Strada and chairing Giraffe before it was sold to Tesco for £50m in 2013. He is also a former Channel 4 chairman.
The father-of-three has chunky investments in a number of other firms including luxury hotels group Elegant Hotels. But he has fallen from grace in recent months after an accounting fraud brought cafe chain Patisserie Valerie to its knees. Johnson, who had a £170m investment in the company before it went bust, is thought to have lost as much as £183m.
He tried to rescue the business using £10m of his own money.
He has now stepped down as chairman of its parent company Patisserie Holdings after it was bought out of administration by Irish private equity firm Causeway Capital, saving 2,000 jobs.
Johnson has also resigned from a string of directorships since the scandal came to light in October, most recently at Brighton-based Small Batch Coffee Holdings.
Patisserie Valerie’s administration revealed this month that the extent of the fraud was far worse than previously thought. Beancounters KPmG found that accounts had been overstated by as much as £94m, compared to the £40m black hole identified by Patisserie Holdings bosses when the fraud first emerged.
Chris marsh, who was finance director at Patisserie Valerie at the time the scandal erupted, was arrested shortly after and subsequently released on bail. an investigation by the Serious Fraud Office is ongoing.
Shares in Brighton Pier Group fell 1.1pc, or 0.5p, to 43.5p.