Revolution Bars Group has given a brief update on expectations for the 52 weeks to 1 July, reporting like-for-like sales up but saying new sites are taking longer than expected to hit full profitability.
It said underlying sales performance of the business had remained positive in the second half with like-for-like sales continuing to grow by 1.7% for the year to date.
The group said that the impact of headwinds such as the living wage, minimum wage, apprenticeship levy and business rates would be more than anticipated in the current year.
The company has opened five new Revolucion De Cubas in the last twelve months (and one new Revolution Bar) and said that while the underlying sales performance of these bars remained on track with an average weekly turnover of £43k (net), they taking longer to mature to full profitability than originally anticipated.
It also warned that two key sites were closed for just under two weeks for major refurbishment (Blackpool in March and Cardiff in May).
Consequently, due to the timing of profit maturation at the new Revolucion De Cubas and the industry-wide cost headwinds, the company predicted that the adjusted EBITDA (pre-opening costs) out-turn for the year is expected to be broadly at the same level as last year.
The group said: “The directors remain confident in the underlying strength of the business, its brands, the strong customer proposition and the business’s capability to deliver high returns on invested capital. Consequently, it remains the plan to open six new bars in the next financial year.