SFI is raising £12m through a sale and leaseback deal with an undisclosed buyer.
The company has sold seven units, one Bar Med and six Litten Trees. It reaped a yield of 6.75% off the deal. SFI is also selling 11 unbranded pubs for about £4.6m
James Kowszun, SFI's soon-to-depart finance director, said the money would be used for new openings and reinvestment within the company.
SFI also said it would sell its five For your Eyes Only table-dancing clubs "in the next few weeks". It said the clubs were a distraction from the business. The management at For Your Eyes Only tried to arrange a leveraged buyout last year but could not raise the funds.
SFI reported a 22% increase in pre-tax profits, and the new chief executive designate, Andrew Latham, revealed an ambition to turn the company into one of the country's biggest concerns.
Saying he wanted to see SFI double in size, Latham declared: "My intention is to take the business forward into the FTSE 250."
Turnover rose 30% to £73m, with like-for-like growth of 4%. Ebitda rose 32% to £18m, and outlet contribution pre-rent increased to 37.7% from 36.3%. Christmas trading saw total sales up 30.2%, with like-for-likes up 5.3%, towards the top end of the industry.
Hill said SFI now believed that numerically its Litten Tree brand, which now accounts for 32% of total group sales, has the greatest potential in the long term. Litten Tree sales increased by 36% in the half-year, while profit contribution grew 56%, even though there were only two openings in the period: like-for-like sales grew by 6%.
By the end of the financial year both Slug and Lettuce and Litten Tree will be approaching 60 outlets, Hill said. He revealed that SFI estimate there is a potential for its core brands of some 500 outlets, which would give SFI its long-term objective of a 20% share by value of the High Street Bars market. For 2001 the research company Mintel estimates the market to be worth £2.5bn, and it is predicting 10% growth this year, Hill said.
At the half year SFI operated 172 outlets, an increase of 28 since the year-end. Of those, 151 are high street bars, and in the second half, 18 more branded High Street outlets are due to be opened.
Hill, who will drop his executive role in April, revealed that he will be stepping down as chairman after the company's AGM in the autumn of 2003. He said the board expects to announce the appointments of a new finance director and retail director "in the near future".
The integration of the Parisa bars, bought last November, with SFI's Slug and Lettuce brand is going extremely well, Latham said: "It was a brand which fitted Slug and Lettuce in terms of its position in the market place." Latham said he believed SFI can "tweak" the business model to derive more value out of the former Parisa bars.
Latham said the events of September 11 had an impact on the company's bars in the City of London, as did redundancies in the financial sector. But the outbreak of foot-and-mouth disease had a "negligible" impact.
SFI's shares fell 3p to 201.5p after the company said it was cutting back expenditure in the capital to get its highly-geared balance sheet in better shape. It will open 24 outlets next year instead of the 40 previously expected. This year it will cut back openings from 30 to 22.
The company has sold seven units, one Bar Med and six Litten Trees. It reaped a yield of 6.75% off the deal. SFI is also selling 11 unbranded pubs for about £4.6m
James Kowszun, SFI's soon-to-depart finance director, said the money would be used for new openings and reinvestment within the company.
SFI also said it would sell its five For your Eyes Only table-dancing clubs "in the next few weeks". It said the clubs were a distraction from the business. The management at For Your Eyes Only tried to arrange a leveraged buyout last year but could not raise the funds.
SFI reported a 22% increase in pre-tax profits, and the new chief executive designate, Andrew Latham, revealed an ambition to turn the company into one of the country's biggest concerns.
Saying he wanted to see SFI double in size, Latham declared: "My intention is to take the business forward into the FTSE 250."
Turnover rose 30% to £73m, with like-for-like growth of 4%. Ebitda rose 32% to £18m, and outlet contribution pre-rent increased to 37.7% from 36.3%. Christmas trading saw total sales up 30.2%, with like-for-likes up 5.3%, towards the top end of the industry.
Hill said SFI now believed that numerically its Litten Tree brand, which now accounts for 32% of total group sales, has the greatest potential in the long term. Litten Tree sales increased by 36% in the half-year, while profit contribution grew 56%, even though there were only two openings in the period: like-for-like sales grew by 6%.
By the end of the financial year both Slug and Lettuce and Litten Tree will be approaching 60 outlets, Hill said. He revealed that SFI estimate there is a potential for its core brands of some 500 outlets, which would give SFI its long-term objective of a 20% share by value of the High Street Bars market. For 2001 the research company Mintel estimates the market to be worth £2.5bn, and it is predicting 10% growth this year, Hill said.
At the half year SFI operated 172 outlets, an increase of 28 since the year-end. Of those, 151 are high street bars, and in the second half, 18 more branded High Street outlets are due to be opened.
Hill, who will drop his executive role in April, revealed that he will be stepping down as chairman after the company's AGM in the autumn of 2003. He said the board expects to announce the appointments of a new finance director and retail director "in the near future".
The integration of the Parisa bars, bought last November, with SFI's Slug and Lettuce brand is going extremely well, Latham said: "It was a brand which fitted Slug and Lettuce in terms of its position in the market place." Latham said he believed SFI can "tweak" the business model to derive more value out of the former Parisa bars.
Latham said the events of September 11 had an impact on the company's bars in the City of London, as did redundancies in the financial sector. But the outbreak of foot-and-mouth disease had a "negligible" impact.
SFI's shares fell 3p to 201.5p after the company said it was cutting back expenditure in the capital to get its highly-geared balance sheet in better shape. It will open 24 outlets next year instead of the 40 previously expected. This year it will cut back openings from 30 to 22.
