Revolution Bars Group Trading Update (3383R)

TIDMRBG

RNS Number : 3383R

Revolution Bars Group

14 June 2018

This announcement contains inside information

Revolution Bars Group PLC ("Revolution" or the "Group" or the "Company")

TRADING UPDATE

Headlines

   --      The Company has experienced challenging and volatile trading conditions. 

-- Total sales for the Group in the second half up to 9 June 2018 are up by 7.3%. However, like-for-like sales are down 1.7%. Adjusted EBITDA is now expected to be below market expectations and in line with last year.

-- New bars opening programme delivered to schedule and is performing in line with expectations.

-- The Board remains confident in the future prospects of the Group as a result of the progress of management initiatives currently underway.

   --      New CEO, Rob Pitcher, joins the business on 25 June 2018. 

Detail on Trading

Revolution Bars Group plc today provides an update on the performance of the Group for the 52 week period ending 30 June 2018. In recent weeks the Group has experienced challenging and volatile trading conditions and sales have fallen short of expectations. Consequently, full year underlying profit performance, measured by Adjusted EBITDA (excluding pre-opening costs), is anticipated to be in line with last year's result (GBP15.1m).

The adverse, wintery weather conditions in March combined with the unusually hot weather throughout May and early June, has curtailed typical late-night week-end trading. The sales performance in the last six weeks at sites with significant outside trading areas has performed well relative to last year.

Total sales for the Group in the second half to 9 June 2018 are up by 7.3%, however, like-for-like sales are down 1.7%. Both of our brands have seen similar changes in their sales trends over this period, although Revolucion de Cuba like-for-like sales remain in growth. For the 49 weeks to 9 June 2018, total sales are up by 9.1% and like-for-like sales are down by 0.5%. Wet sales have performed better than food, particularly in the Revolution estate where little food development and innovation was undertaken in 2017. This development is now underway for delivery in Q1 next year.

Whilst the Board believes that the weather has been the most significant factor impacting the sales trend, disruption caused by operational management change prompted by the unsettling effect of last year's takeover activity and the prolonged absence of a CEO has also played its part.

The Board remains confident in the future prospects of the business given the following initiatives:

1. The new bars opening programme for the current financial year has been delivered to schedule. Those 5 bars are performing to expectations;

2. As planned, we have six new sites for our next financial year including four large bars scheduled to open in the next four months;

3. Following a full review, we anticipate significantly improving the effectiveness of our marketing expenditure;

4. The roll-out of labour scheduling software across all venues has been completed in recent weeks and is starting to deliver real operational improvements;

5. Simon Dobson, the Group's new Food director, joined the business towards the end of January to drive a step change in Food sales and profitability;

6. Pre-booked revenue continues to grow and it is anticipated that that further strong growth in this important income stream will be achieved.

The Group's new Chief Executive Officer, Rob Pitcher, joins the business on 25 June 2018.

14 June 2018

Enquiries:

 
Revolution Bars Group               [phone] 
Keith Edelman, Executive Chairman 
 Mike Foster, Chief Financial 
 Officer 
 
 
Instinctif Partners 
 Matthew Smallwood 
 Tim Linacre 
 Tom Berger                         [phone] 
 

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June 14, 2018 02:00 ET (06:00 GMT)