Serious financial surgery has helped pull SFI, the group behind the Slug & Lettuce chain, back from the brink, with the company reporting a significant narrowing of losses in the past year.
SFI delisted from the London Stock Exchange last May, after the revelation of accounting discrepancies exposed a £20m hole in the company's finances.
For the year ending 29 May 2004, SFI incurred a pre-tax loss of £26.4m (2003, £110m) on a turnover of £128.7m (2003, £153.2m). Excluding trading results from the disposal sites, however, operating losses were pulled back from a loss of £8.8m in 2003 to an operating profit of £300,000 for 2004.
The troubled group said that the decline in turnover was largely because of the reduction in the number of sites, slashed from 183 to 157.
As well as restructuring its portfolio, SFI's recovery plan involves a multi-million-pound overhaul of its Litten Tree chain and the rebranding of several Bar Med operations. The group said that the first 12 weeks of the new financial year had seen a 2% rise in like-for-like sales and an improvement in overall profitability.
In April, the company was given a new lease of financial life through a deal that saw creditors write off £83.4m of debt in return for a 75% shareholding in the company.
Chief executive Stuart Lawson, appointed in June last year, received a salary and benefits package worth £426,000 for the year.