GBK plans to close six restaurants, slash its openings pipeline for this year and refresh 30 sites, as it seeks to turn around sales, which fell 6.8% on a like-for-like basis in the year to 28 February.

Derrian Nadauld, who was appointed managing director of the 106-strong brand at the end of last year, unveiled the strategy at an investor conference for parent company Famous Brands this morning. The plan will also involve moving away from an exclusive delivery partnership with Deliveroo to link up with Just Eat and other providers.

He said two sites would open in 2018, compared to ten in 2017. Six ‘distressed sites’ have been identified, with Oldham closing last week. He said there was no timetable for exiting the remaining five sites and a number of options were on the table.

Nadauld said a new marketing campaign aimed at re-establishing the GBK brand assets would be launched next month.

He said ten sites would be refurbished before July with a further two pockets of ten in the months following, with the aim of “making the brand pop”. The menu design has also been simplified, with a further focus on entry and exit pricing.

GBK saw like-for-like sales fall sharply in 2017, from c7% at the start of the year to c-10% by December, on a three-month rolling average. Nadauld said the brand had been hit by a combination of factors, including consumer confidence but also competitor incursion. He said where there had been incursion into GBK’s catchment area, the restaurant had seen an average 7% decline.

He said that in areas where a nearby Byron had closed, GBK restaurants had seen up to 14.8% uplift in like-for-like sales.

We’re not naïve about the challenge but we are optimistic about the prospects in the medium term

He said the group had also lost ground on delivery, where its first-mover advantage had been eroded. He said the model of cooking burgers to order had led to a c10 minute longer delivery time, although this had been reduced in recent months.

Nadauld said: “We have had a challenging year and the 12 months ahead is not going to be much easier with the macroeconomic climate in the UK. But, we have a great team of people behind this brand –with a combination of some expertise from Famous Brands and also the team in the UK. It’s still the favourite burger brand in the category – 31% of consumers vote us their first choice burger brand. It’s about making sure we offer value, that we’re accessible and convenient and that extends into delivery and online.

“We’re not naïve about the challenge but we are optimistic about the prospects in the medium term.”

In its full-year update, Famous Brands threw its weight behind Nadauld, with chief executive Darren Hale saying: “Remedial measures implemented during the reporting period are expected to deliver improvements in the business, and with new management and intensified oversight in place we are satisfied that we can reverse recent declines over the medium term.”

During the period GBK reported an operating loss before non-operational items of £3.6m with system-wide sales up 4.9% but like-for-like sales down 6.8%. During the year, 10 restaurants were opened in the UK and two revamped in Ireland.

Famous Brands also operates Wimpy in the UK, which recorded an 8.6% increase in revenue despite closing a net of three restaurants during the period. One restaurant was opened, bringing the network to 78 restaurants.

Summarising his thoughts on the UK, Hele said: ““The UK food services sector continued to face difficulties, with businesses subjected to notably higher property rates and increased labour and food costs. Despite this, Wimpy reported satisfactory results. While the GBK operation made some progress in adapting to the challenges experienced in that economy and industry, and notwithstanding operational improvements reported in the period, impairments recognised in GBK considerably reduced the carrying value of the business.”