Revolution CEO: government's treatment of wet-led hospitality ‘nothing short of scandalous'
Revolution Bars Group chief executive Rob Pitcher has said the UK government's actions towards wet-led bars and late-night hospitality during the Covid-19 pandemic have been "nothing short of scandalous".
Commenting on the group's preliminary financial results for the year ended 27 June 2020, he said: "The UK government's actions towards wet-led bars and late-night hospitality are nothing short of scandalous. It has little evidence to justify the severe restrictions that have been imposed and it is deliberately sacrificing businesses and people's livelihoods.
"The recent grants of £1,000 per pub as compensation for being deprived of our most important trading period is derisory and insulting, and underlines a complete lack of understanding of the costs associated with businesses of this nature (even when they are shut) or any sympathy for the consequences of their inept decisions.
"The next few months will continue to be challenging and entirely dependent on imposed operating restrictions. Further meaningful government support will be required to help safeguard the industry and avoid further job losses, particularly for young people.
"However, given the actions we have taken to secure the future of the business, I am confident that Revolution will emerge from this crisis as a more focused business, and in a strong position relative to our competition, ready to seize any opportunities that arise.''
The group's results for the 2020 financial year comprised "two very contrasting halves", with like-for-like sales improving by 1.2% in the first half and the second "severely impacted" by the enforced closure of all its bars from 20 March.
Government assistance was described as "totally inadequate" for a predominately wet-led and late-night business, with the latest grants offered to compensate for the loss of the critical Christmas trading period showing the "total misunderstanding of business models and costs".
The group operated 74 premium bars in the UK under the Revolution and Revolución de Cuba brands during the period, now 67 following the company voluntary arrangement (CVA) of its Revolution Bars subsidiary.
The group reported a statutory loss before tax of £21.7m against a £5.6m loss last year, and total revenue of £110.1m, a 27.3% decrease on 2019.
Revolution said it had secured liquidity through an increase in committed debt facilities from £21m to £37.5m, including a Coronavirus Business Interruption Loan of £16.5m, and an equity fundraising of £15m at the end of July 2020.
Longer term, it said the government must support hospitality companies to repay the debt funding built up as a result of the operating restrictions imposed on them during the pandemic. It called for the reduced VAT rate of 5% to all sales of food and drink to be extended until at least the end of 2021, and the relief for business rates extended into the 2021/22 fiscal year.
The group said severe disruption to trade during the last nine months caused by Covid and the resultant and frequently changing operating restrictions imposed by the UK government and the devolved authorities means there is "a material uncertainty over the going concern of the group".
However, the directors said they have a reasonable expectation that the company and the group have sufficient resources to continue in operational existence for the period of 12 months from the date of approval of these financial statements.
At Revolution's annual general meeting on 22 December, chief financial officer Mike Foster will retire from the board and Danielle Davies appointed in his place.
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