Tasty, which operates 54 Wildwood and six Dim T restaurants across the UK, has implemented an 18-month plan to assess and identify a “number of weaknesses” in its operational structure.
Documents filed with Companies House for the 52 weeks to 31 December 2017 report that Tasty’s revenue increased by 9.7% to £50.3m compared to £45.9m in the 53 weeks ended 1 January 2017. The company made a loss before tax of £9,470,000 in the same period, compared to a loss of £88,000 in 2016/17. EBITDA was -£0.67m, compared to -£0.49m the previous year.
The documents highlighted the “difficult market conditions” and challenges facing the sector including increased labour and food costs as well as business rates.
Within the report chairman Keith Lassman writes: “The board does not expect market conditions to improve in 2018 and believes a further deterioration is likely. Underlying input costs will continue to rise and consumer spending will face increased pressures. The group’s next round of operational improvements are targeting improvements in the areas of sales, food and labour margins however it will be some time before the full benefit of these changes is felt and financial performance in 2018 is very unlikely to see any improvements on 2017.”
During the period Tasty opened six new sites in Bicester, Birmingham, Skipton, Kettering, Rushden Lakes and Hinkley, and disposed of six under-performing sites in Canary Wharf, Ilkley, Abingdon, Bristol, Barnes and Gloucester. In addition, the company sold the freehold of its Kettering site.
There are still a “number of sites” the group is planning to dispose of, and it has “not committed to any new openings in 2018.”
The company is now focusing on better customer engagement and staff retention as well as plans to restructure its operations team, reducing headcount.
Daniel Jonathan Plant, joint chief executive officer of Tasty, stated in the document: “The results of the Brexit referendum have created a high level of uncertainty across a range of issues that impact the economy. Continued deterioration in consumer confidence due to future economic conditions could have a detrimental impact on the group in terms of footfall and sales.
“To mitigate this risk, the group continues to position its brands within the affordable segment of the casual dining market. The group [also] monitors its food supply chain closely, regularly reviewing food costs and implementing a variety of strategies to mitigate the impact of increases.”