- The Revel Collective
- 11 April 2024 09:15:30
Source: Sharecast
Revolution Bars said its restructuring plan would affect Revolution Bars Ltd and would see it exit the leases of 18 loss-making sites and impose a rent reduction on a further 14 sites, which the company said would enable it to return to profitability at a sustainable level.
To fund its planned restructuring efforts and provide additional working capital, Revolution proposed a fundraising to raise up to £12.5m - including £3.0m from Luke Johnson, who will take over as chairman if the restructuring gets sanctioned. Additionally, Revolution also launched a formal sale process to explore whether a sale of the shares in the company would provide a more beneficial outcome than the restructuring.
In terms of earnings, Revolution achieved year-on-year sales growth of 8.3% in the six months ended 30 December and a pre-tax profit of £3.1m, after an exceptional gain on disposal of £3.9m relating to the exit from certain leasehold properties.
Group like-for-like sales for the four weeks to 31 December were up 9.0%, the company's best festive period since 2019. Like-for-like sales for the first half, including New Year's Eve, were down 2.8%.
"Following an ongoing period of softer trade post-Christmas, coupled with significant cost pressures on the group and industry, today we have announced that the board has concluded that it is in the best interests of the group for Revolution Bars Limited to propose a restructuring plan, alongside a number of additional measures to be implemented across the Group to re-shape the business, as well as exploring, in parallel, a formal sale process in order to deliver the best outcome for stakeholders," said Revolution.
"In order to fund a potential restructuring plan and provide working capital for the group, the board has concluded that the group needs to raise additional equity capital from new and existing investors through a fundraising."
As of 0910 BST, Revolution shares were up 8.26% at 1.24p.
Reporting by Iain Gilbert at Sharecast.com