Trading Statement

RNS Number : 8986X

Eclectic Bar Group PLC

25 November 2014

 



25 November 2014

Eclectic Bar Group PLC

("Eclectic "or "the Company")

Trading Update

Eclectic provides the following trading update for the year to date.  Eclectic reported its preliminary results for the year ended June 2014 on 30 September 2014. During the Company's first quarter trading was in line with expectations however, the second quarter, which includes the important October period when students return to university, is proving more difficult.

The Company has experienced three main challenges which have negatively affected its result for this period: 

Ø University undergraduates nationwide have been less active across the marketplace during the Freshers' weeks and have been less predictable

Ø There has been increased and intense competition in a number of specific locations

Ø Additionally, because of the above factors two of our new openings,  Lola Lo in Derby and Dirty Blonde in Brighton, have not performed as projected

Trading is stabilising, albeit at a lower level than expected. The management team have undertaken various mitigating actions and are actively assessing the new trends and the cost base is being reduced to match demand, as appropriate.

Despite this mitigating action and it being early in the Company's financial year, the Board now believes that the shortfall created over the last few months is unlikely to be recovered.   The Board anticipates that, based on the trading year to date and provided that trading for the rest of the half year is in line with the Board's revised expectations, the first half adjusted EBITDA is likely to be in the region of £1.1m (the equivalent adjusted EBITDA for the half year 2014 excluding discontinued operations was £1.4m).

On a more positive note, bookings for Christmas and New Year are looking strong, in particular for Lowlander, Dirty Blonde and Manchester Lola Lo.

Consequently, whilst acknowledging that Eclectic is a strong, well-financed business, profitable and highly cash generative, the Board has decided it would be prudent to reduce its aspirational roll out of 2 to 3 new openings in the current year to 1 to 2.

The previously announced dividend of 2.5p per share will be paid on 27 November. The Board will consider the payment of an annual dividend at the time of the final results in September 2015 dependent upon trading performance during the remainder of the financial year.

Enquiries:

Eclectic Bar Group Plc       (www.eclecticbars.co.uk)	Tel: [phone]
Reuben Harley, CEO John Smith, CFO
Panmure Gordon	Tel: [phone]
Corporate Finance
Andrew Godber / Atholl Tweedie / Duncan Monteith
Corporate Broking
Charles Leigh-Pemberton  / Maisie Atkinson
Instinctif Partners	Tel: [phone]
Matthew Smallwood
Justine Warren

 

END

 

 

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