B&K plans £2.5m rights issue to offset lockdown losses
As reported by The Morning Advertiser’s (The MA) sister title MCA, the brewpub operator has three offers of refinancing of existing loans and also intends to grant a rights issue to raise in the region of £2.5m.
Additionally, Brewhouse & Kitchen also forecasted its trading will return to pre-pandemic levels within the next 12 months.
As things stand, the 22-site group faces loans of £4.3m repayable in 2021 and while the operator has breached one banking covenant, the lender in question has replaced the covenant on the basis the company will meet the new agreement according to MCA.
Brewhouse & Kitchen posted on operating loss of £828,921 for the year ending 28 September 2019 though increased by 7% to £15.16m with a further £1.7m in new equity raised during the same period.
Strong post-lockdown sales
As reported by The MA, however, the operator revealed that its sales increased by 115% during the first six days of the Government’s Eat Out to Help Out scheme.
Following the staggered reopening of 17 of its 22 sites throughout July, Brewhouse & Kitchen had already recorded growth of 6.1% during its first four weeks of trading. However, this accelerated to 29.4% during the week ending 8 August.
According to a statement from the brewpub operator, its presence on the south coast helped it boost post-lockdown trading though it caveated that trading in the capital has been more challenging in general, despite sales at its sites in Highbury and Islington, north London being ahead of forecast.
What’s more, in light of the Covid-19 pandemic, the group has also been inundated with job applications according to chief executive Kris Gumbrell, after receiving hundreds of applications for a trio of managerial vacancies after Boris Johnson called last orders in pubs on 20 March.
“We held off for about a month towards the end of April and we were deluged with applicants,” Gumbrell told The MA.
“For one of our sites we had over 200 applications for the role and had to shortlist it down to 70, the calibre was very very high.”
