Western Daily Press (Saturday)
Revolution Bars halts new openings as sales decline
REVOLUTION Bars has paused its expansion plans as it warned on profits after a period of declining sales.
The company, which has 79 bars in the UK, said annual underlying earnings will be between £11 million and £12 million.
The consensus estimate was £12 million.
This was a result of a slower first half, with like-for-like sales in the 26 weeks to December 29 2018 down 4 per cent.
Shares in the company were down 16 per cent in morning trading yesterday.
While like-for-like sales were positive at the group’s secondary brand Revolucion de Cuba, the core Revolution brand was hit by underinvestment.
As a result, the company will hold back on new bar openings and instead focus on refurbishing its existing sites.
Chief executive Rob Pitcher said: “Revolution has been reviewed, the issues identified, and workstreams are being implemented to restore it to growth.
“Our confidence in achieving this is underpinned by the good performance of the new Revolution venues, while the recently refurbished sites are also seeing uplifts. We have therefore decided to prioritise the refurbishment programme over new openings.”
The firm said the under-performance had been exacerbated by the hot summer and instability in man- agement. In 2017 the company was the subject of a takeover offer from Slug & Lettuce owner Stonegate.
Revolution shareholders rejected Stonegate’s offer, leading previous chief executive Mark McQuater to resign. Mr Pitcher took over his role in February last year.
Current trading was also weak, with like-for-like sales in the eight weeks to February 23 down 7.3 per cent, though performance did improve in the first three weeks of February.