H1 Trading Update

RNS Number : 0175Z

Revolution Bars Group

20 January 2022

 

Revolution Bars Group plc (LSE:RBG)

H1 Trading Update

Revolution Bars Group plc ("the Group" or "the Company"), a leading operator of 67 premium bars, trading mainly under the Revolution and Revolucion de Cuba brands, today announces a trading update for the 26 weeks ended 1 January 2022.

As previously reported, LFL sales for the majority of the half, from 19 July 2021, when restrictions were relaxed in England, to 13 November were very strong at +14% versus the comparable period two years ago. Overall, 2-year LFL sales for the period from 19 July 2021 to 1 January 2022 remained positive at +1.4%, with the business performing as well as could be anticipated given the additional restrictions imposed on our guests in the Christmas period.

Sales over the Christmas period were impacted by the move to 'Plan B' including the return to the 'Work From Home' instruction, implementation of Vaccine Passports for late night bars and government messaging which unhelpfully encouraged the limiting of social interactions. LFL sales for the 6 week period ending 1 January were -23% when compared with the same period 2 years ago, the last unaffected Christmas period. 

The impact of the Government actions was most felt in the cancellation of office parties.  Pre Booked Revenue, an indicator of Corporate Christmas parties, was -39% for the 6 week period to the 1st January 2022 when compared to 2019/20. However, the total number of bookings during the 6 week period was at +19% highlighting that our young guest base were still keen to go out and enjoy themselves. Both of these metrics were significantly higher earlier in December before the Omicron variant and negative government messaging took hold. Pleasingly, many of the corporate parties have already been rebooked for early in 2022.  

Our refurbishment programme has continued as planned and we have completed 6 refurbishments and are pleased with their early performance, with a further 13 to complete in current financial year.  We have a strong pipeline of new sites building and are currently in negotiations on 5 sites, expecting to sign the lease on our first new site imminently.

Cash, net of bank loans, was £4.7m as at 19 January 2022 following the utilisation of a portion of the funds raised last year on our refurbishment programme.

Despite the government's response to Omicron, which in our view was overly cautious and caused a substantial loss of trade during the important festive season, the Board remains confident of achieving its full year expectations assuming that the Covid landscape does not significantly deteriorate. We are encouraged by the strong performance pre Christmas and yesterday's welcome announcement from the Government about easing all restrictions but are nonetheless alert to and monitoring closely the inflationary pressures building across all elements of the supply chain and are taking action to mitigate these where possible.

The Group intends to publish its Interim Results for the first half on 1 March 2022.

Rob Pitcher, CEO of Revolution Bars Group, said:

'I am so proud of our team's resilience in the face of the confusing government messaging and the disappointment of the wave of corporate booking cancellations it caused during December. The only comfort is that many of these parties have already been rebooked and it was pleasing to see the number of general guest bookings significantly up versus 2019 demonstrating that our young guest base remains as enthused and excited about our offering as we are.

Yesterday's news of the scrapping of the work from home guidance and the cancellation of all other restrictions is very welcome for our business and will actively help rebuild consumer confidence. It is imperative that going forward there are no further restrictions as we all learn to live alongside Covid 19.

We continue to urge the Government to support the recovery of the hospitality industry by leaving VAT at 12.5% and retaining business rates relief in line with the current levels of support.

Our robust performance in H1 proves the resilience of our business, that our guests enjoy the fun and memorable experience we create which results in a highly cash generative business when operating free of restrictions.'

Revolution Bars Group plc   Rob Pitcher, CEO Danielle Davies, CFO	Tel: [phone]
finnCap, NOMAD and Joint Broker Matt Goode / Simon Hicks / Teddy Whiley (Corporate Finance) Tim Redfern / Richard Chambers (ECM)	Tel: [phone]
Peel Hunt LLP, Joint Broker   George Sellar / Andrew Clark	Tel: [phone]
Instinctif (Financial PR)   Matt Smallwood	Tel: [phone] 1445

 

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