Revolution Bars cuts losses as young people revive bar chain after Covid-19 revenue drop
Revolution Bars Group’s (Revolution) revenues are being revived by the return of its young customer base, as it looks to recover from a brutal drop in sales.
Sales plummeted by nearly two-thirds this year, falling from £110.1m in the previous year to £39.4m.
The premium bar chain suffered restrictions or closures every day during its full-year of trading, with two government-enforced lockdowns over the past 12 months and indoor dining banned between January and May.
Since pandemic restrictions eased in June, it has enjoyed a huge boost of revenue from the return of younger patrons to hospitality sites.
In the first 14 weeks of its 2022 financial year, Revolution has exceeded the total revenue generated in its published full year results.
It is now benefitting from a 137 per cent compared to last year’s total figures, which are also 14 per cent ahead of the less Covid-raged 2020.
The group has now created two new brand concepts: Founders & Co – an artisanal market-place experience, and a soon-to-launch “competitive socialising concept“.
Revolution rides the pandemic storm
Despite the drops in revenue, the Revolution has soberly sailed through the storm, securing liquidity through loans, cost-cutting and fundraising.
It received £20m in Covid-19 business loans from the government, while its bank NatWest has postponed £10.5m in loan amortisation payments originally scheduled for the financial year.
The group has saved £6m in rent by exiting six-loss making sites and surrendering a further two bars and negotiated reduced costs with its suppliers and partners.
Revolution will replace the sites with eight new locations which it hopes to open over the next two years.
Board members are also taking reduced salaries.
Meanwhile, Revolution kick-started two equity fundraisers achieving net proceeds of £34m, enabling the group to reduce its borrowing.
The measures have resulted in the pub chain reducing its operating losses from £32.7m to £21.2m, and its losses per share from 70.3p to 21.2p.
It has consequently refurbished three sites, and maintained a net cash position of £4.6m.
Net bank debt is also down from £22m to £3.6m.
Rob Pitcher, chief executive officer at Revolution, said: “Given the backdrop of one of the most challenging years for our Company, I am thankful to our colleagues for their resilience, professionalism and dedication. Our teams continue to create the party, and it is this effort that has resulted in our guests returning in such numbers which has in turn allowed us to enjoy such a strong start to our year.”