Luminar posts £1.1m loss

By Ewan Turney

- Last updated on GMT

Related tags: Lloyds banking group

Douglas: initiatives are gaining traction
Douglas: initiatives are gaining traction
Britain's largest nightclub group, Luminar, has announced a loss before tax of £1.1m for the year ending on 26 February against a profit of £5.5m...

Britain's largest nightclub group, Luminar, has announced a loss before tax of £1.1m for the year ending on 26 February against a profit of £5.5m last year.

Luminar, which runs 77 nightclubs, said there had been some signs of improvement with the second half of the year down 14.7% compared to a 20.6% dip in the first half.

The loss after discontinued operations, exceptional items and tax was £188m. Exceptional costs totalled £187.4m and primarily consisted of non-cash impairment of specific fixed assets and goodwill.

It said it had been severely hit by the December snow and combined with the continued economic downturn had "placed significant stress on financial covenants".

The group has managed to secure a financial covenant waiver from its banking group — Lloyds TSB, Barclays Bank and the Royal Bank of Scotland — which was set to be tested at the end of May.

"The Banking Group are continuing to provide flexibility to maintain the Group's liquidity levels until 31 August 2011, whilst they work with Luminar to determine the appropriate basis for a longer term restructuring of the Group's debt arrangements in light of continued challenging trading conditions," it said.

Head office savings

Total sales for the year were down 18.8% overall and 17.5% on a same outlet basis at £137.3m with EBITDA at £22.9m. Savings of £2.8m were made at head office.

Cash generation, predominantly through the sales of 16 sites for £7.4m, has reduced net borrowings by £10.5m to £82.2m.

Overall, Lumninar attracted 11m people to its venues with the average drink costing £2.22 — up on the average of £2.15 the previous year. Average spend per customer was largely stable at £12.41, compared to £12.46 last year.

Sales for the first nine weeks of the current year are 13.9% down on last year on a same outlet basis.

Challenging

"Whilst the marketplace remains challenging, the business is continuing to focus on operational excellence and responding to customer demands," said chief executive Simon Douglas.

"The results for the year, while disappointing, show some early indications of improvements in like for like trends. Equally encouraging is the early evidence that initiatives introduced midway through the year appear to be gaining traction and are diversifying our offerings and revenue streams."

The late night operator is to continue its focus on diversifying its entertainment, such as its link-up at a number of venues with comedy group Jongleurs and re-energise its marketing startegy.

Related topics: MA Leaders Club

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