Prezzo more than halved its overall operating losses in 2018, a year that saw it agree a CVA that incorporated the closure of 94 sites and rent cuts of up to 50%.
In the same year as the site closures revenue fell from £211.6m in 2017 to £157.2m in 2018 and operating profits, excluding non-trading items, sank to a £7.1m loss, compared to a £6.6m profit in 2017.
However, operating losses including non-trading items were halved from £65.6m in 2017 to £29.7m in 2018. This included £22.7m of one-off items including the write-down of property, plant and equipment.
Executive chairman Karen Jones, who was appointed in June 2018 following the CVA, said the company was now focused on ensuring customers left wanting to return after a period where a “strategy of new openings and new concepts distracted from its mission of hospitality”.
The casual dining group, which now has a portfolio of 185 restaurants, said it had further stabilised its financial position in August 2018 through a debt for equity swap, which reduced debt from £155m to £53m.
The board and investor group have agreed to a £5m refurbishment programme, which will include 50% of the estate funded by working capital and shareholder loans. A further £3m has been earmarked for investment in restaurant technology, repairs and maintenance.
Jones said: “Our industry has faced a tough time and Prezzo’s previous strategy of new openings and new concepts distracted from its mission of hospitality. A number of important mitigating actions were taken in 2018 and we’ve started 2019 with a clear plan and in good heart – focused on our people and on our customers, listening to them and serving them better. Our turnaround plan is at an early stage but I am delighted with the initial results and the positive feedback from our customers and our teams.
“Our concentration will always be on investing in our teams and ensuring that each customer who walks into a Prezzo has the best possible experience. Only through this will we ensure that every customer leaves wanting to return.”