Hostmore, recorded a loss of £91.9m for the 52 weeks to 1 January 2023, compared to a profit of £11m the prior year.

The group, which operates Fridays, 63rd+1st and Fridays and Go, recorded total revenue for the year of £195.7m – a 23% increase on FY21 of £159m, with like-for-like sales revenue up 22% to £189.1m.

EBITDA for the year stood at £31.1m, down from £34.5m in FY21, while FY22 EBITDA FRS 102 was £11.3m (FY21 £13.0m), reflecting weaker consumer demand and inflationary pressures.

Overall net debt , including lease liabilities, increased from 163.2m to £176.3m, with net bank debt having increased to £27.7m, from £12.2m in the previous financial year, while free cash flow reduced from £31m to £16.5m, over the period.

Revenue in the first 16 weeks of FY23, adjusted for the variance in VAT rate on food sales between FY22 and FY23, were 2% higher than in 2022.

The business said a cost reduction exercise had been completed in Q1 2023 and would reduce overheads by £1.8m on an annual basis.

And it has today (2 May) announced a further cost reduction programme resulting in £4.1m of annualised savings.

The implementation of this additional cost reduction has utilised £0.3m of cash, it said, with substantially all affected employees and service providers impacted by the new cost reduction programme having now left the group.

Hostmore reported that it had recently reset its banking covenants in line with the group’s business plan, with an extended term, to 1 January 2025, and had secured £2.3m of landlord concessions in FY22, comprising the waiver of past obligations and confirmation of incentives for extension of leases on profitable stores.

It has also agreed with its brand franchisor to defer all future new opening obligations until FY25, which is due to save an estimated £13m of capital expenditure over the FY23 and FY24 financial years.

Hostmore reported that trading was in its stadium and major shopping centre locations was stronger compared to the prior financial year, with the north-east and north-west recording the more improvement.

The restaurant group opened five new sites during the FY22 financial year. Three Fridays restaurants, in Chelmsford, Barnsley and Durham, one 63rd+1st in Edinburgh and its first Fridays and Go, in Dundee.

Commenting on the results, chairman Gavin Manson said: “Hostmore’s first full year of being an independent listed company has been challenging for the economy and consumers - and for the company.

“The impact on consumer confidence of the rapidly increasing inflationary pressures arising from the Russian invasion of Ukraine in February 2022 changed the nature of the market in which we are operating.

“We have adapted our marketing and capital allocation policy to these new circumstances and are now firmly focused on delivering improved performance from our core TGI Fridays estate; not undertaking new site openings for our brands in FY23 and FY24; and continuing our cost reduction and debt repayment.”