Trading Update

RNS Number : 6395F

Revolution Bars Group

19 May 2017

 

Revolution Bars Group PLC

("Revolution" or "The Company")

Trading update

Revolution wishes to update the market on expectations for the 52 weeks to 1 July 2017. The underlying sales performance of the business has remained positive in the second half with like for like sales continuing to grow by 1.7% for the year to date and gross margins remaining as expected.

The Company is experiencing the well-publicised sector cost headwinds from the impact of the living wage, the double increase this year in minimum wage, the new apprenticeship levy, as well as the above inflation increase in general business rates. These increased costs will be more than anticipated in the current year.

The Company has opened five new Revolucion De Cubas in the last twelve months (and one new Revolution Bar) and whilst the underlying sales performance of these bars remain on track with an average weekly turnover of £43k (net), these bars are taking longer to mature to full profitability than originally anticipated. Additionally, two key sites were closed for just under two weeks for major refurbishment (Blackpool in March and Cardiff in May). All these sites will make a full profit contribution in our next financial year.

Consequently, due to the timing of profit maturation at the new Revolucion De Cubas and the industry-wide cost headwinds, the Company believes that the adjusted EBITDA (pre-opening costs) out-turn for the year is expected to be broadly at the same level as last year.  

The Directors remain confident in the underlying strength of the business, its brands, the strong customer proposition and the business's capability to deliver high returns on invested capital. Consequently, it remains the plan to open six new bars in the next financial year.

                                                                                                                            19 May 2017

For further information:

Revolution Bars Group plc                                                       T:  0161 331 3708

Mark McQuater, CEO

Instinctif Partners                                                                     T:  020 7457 2020   

Matthew Smallwood      

 

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