Pubs ‘n' Bars breaches banking covenants as it slides into the red

30 June 2009 by
Pubs ‘n' Bars breaches banking covenants as it slides into the red

Pubs ‘n' Bars made a loss of nearly £9m last year and breached it banking covenants as a fall in the property market led to the re-evaluation of the value of its pubs.

In the year ended 31 December 2008, the company made a loss of £8.9m compared with restated profit of £341,960 in 2007. This was despite turnover increasing 11% to £22.3m (2008: £20m).

The loss was caused by a significant fall in property values recognised in the company's income statement, along with other accounting charges and a tough trading environment due to falling consumer confidence.

Pubs ‘n' Bars said it was in talks with its bankers to restructure its bank facilities, which will likely lead to an increase in interest rate charges.

The company's financial figures for 2007 have also been restated as part of the adoption of the International Financial Reporting Standards (IFRS).

Keith Chapman, chairman of Pubs ‘n' Bars, said: "This has been a particularly challenging period. Although revenues for the year have increased by 11%, tough trading conditions and IFRS accounting polices have contributed to the company generating a pre-tax loss.

"As consumer confidence remains fragile the company approaches the future with cost-consciousness and caution".

Like-for-like sales at the 100-plus pub estate are currently running 3% below last year.

Pubs ‘n' Bars sees sales stall over Christmas period >>

Pubs ‘n' Bars chairman slams planned beer duty rise >>

Pubs'n'Bars issues profits warning >>
Pubs'n'Bars bucks the general malaise >>

By Chris Druce

E-mail your comments to Chris Druce here. jobs
Looking for a new job? Find your next pubs job here with jobs

Blogs on]( Catch up with more news and gossip on all Caterer's blogs
[Newsletters For the latest hospitality news, sign up for our e-mail newsletters.
The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.


Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking