Gourmet Burger Kitchen widens losses after £16m restructuring hit
Casual dining chain Gourmet Burger Kitchen (GBK) suffered widening losses last year after taking a £15.7m hit on its restaurant closure programme.
The burger restaurant completed a company voluntary arrangement (CVA) during the period, which saw it shutter 24 sites, contributing to a pre-tax loss of £24.3m in the year ended 24 February, compared to £6.3m in the previous period.
Read more: Creditors give green light to Gourmet Burger Kitchen closures
GBK reported a £15.7m charge related to the restructuring plan, which contributed to the loss for the year, according to the firm’s latest financial accounts published on Companies House.
Revenue fell seven per cent to £76.1m from £81.7m due to the impact of the restaurant closures and increasing competition in the casual dining market.
The company said it did not open any new restaurants during the period, compared to the previous year in which 10 new branches were launched, reflecting the mounting pressures facing the casual dining industry.
Read more:Gourmet Burger Kitchen earmarks restaurants for closure
“[The decline in revenue] was driven by site closures, difficult trading conditions in the wake of economic uncertainty prompted by Brexit, continued over supply in the sector and a significant number of new entrants culminating in a decline in like-for-like store performance,” the company said in its annual accounts.
“The in-store performance was significantly offset by increased online sales driven by increased consumer demand for convenient dining at home as well as management’s decision to increase GBK’s online footprint with more providers.”
Read more: UK’s top restaurants swing to £93m loss
The casual dining sector has come under increasing pressure in recent years due to falling sales, a highly competitive market and rising overhead costs.
Research published this morning by accountancy firm UHY Hacker Young found that the UK’s top 100 restaurants have fallen to a £93m loss, compared to a profit of £37m this time last year.
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