Upper Crust owner bites off an extra £175m Covid support

UPPER CRUST and Ritazza cafe owner SSP has ramped up its Government borrowing by £ 175 mill i on to cope with tough travel restrictions, The Mail on Sunday can reveal.

The increase takes the travel food operator’s borrowing t hrough the Bank of England lending programme to its agreed maximum of £300 million.

The move comes after the latest stringent lockdown measures were put in place across the country a month ago and as the window to draw additional funds from the scheme is fast closing. It is not yet clear if the March 22 deadline for extra borrowing will be extended.

It means SSP – which is also an M&S Simply Food and Burger King franchisee – is now among the biggest corporate debtors under the Covid Corporate Financing Facility ( CCFF), which was launched to offer help to Britain’s biggest firms through the crisis.

British Airways, bus and rail operator FirstGroup and aerospace engineer Rolls-Royce have all borrowed the same amount under the taxpayer-backed initiative.

FTSE 250-listed SSP operates at airport and railway stations where closures and plummeting tourist and commuter trade have left its finances battered.

The company’s chief executive Simon Smith warned last year that it was ‘ burning’ cash at around £25 million a month.

Its increased borrowing under the CCFF is understood to have taken place in recent days.

Shore Capital said in a report last week that speculation of a fresh fundraising by SSP was ‘an ongoing debate’ in the City.

The analyst said SSP may yet seek to raise around £200 million through a share sale to provide it with breathing room as it emerges from the crisis.

The remaining credit available from all its lending sources was about £520 million before the Bank of England facility was drawn, which Shore said would sustain SSP until next year.

SSP is understood to have until February 2022 to pay the money back – an arrangement well in excess of the 12-month facilities arranged by many large firms under the scheme.

It is likely to face restrictions on executive pay and dividend payments until the money is repaid.

Shore Capital said the company could still benefit from pent- up demand for leisure travel this summer as the vaccine roll- out programme accelerates.

The boom could eventually see it return to profitability in its financial year to September 2022 if consumer confidence returns.