Revolution Bars Group CEO Rob Pitcher also said young people have seen the largest fall in real wages as the group released its Annual Report and Accounts 2023.
Revolution Bars Group, which operates 89 venues (69 in 2022) through its Revolution (47 sites), Revolucion de Cuba (18), Peach Pubs (21), Founders & Co (1) and Playhouse (2) brands, has seen like-for-like revenue down 5.5% in its in current financial year (FY24) beginning 1 July 2023.
But this has improved during the past three weeks to minus 3.5% as a result of improved performance in Revolution bars following the return of students, continued positive momentum in Revolución de Cuba bars, and a continuation of the strong performance seen at Peach Pubs.
The group, which posted its results in October 2023, said it has focused on integrating Peach Pubs (acquired in October 2022) into the group and remain confident in delivering an additional £1.5m of annual synergies it identified at the time of making the acquisition by FY25.
Non-executive chairman Keith Edelman said: “[The Peach Pubs] acquisition has already delivered much-needed diversification of sales and guests to tackle the changing environment and consumer trends seen post-pandemic.
“When the sun shines, we now get to benefit from our guests flocking to the lovely outside spaces at our pubs.
“Our Revolution brand has, however, been particularly impacted by the reduced footfall as a result of the well-publicised challenges faced by our young guest base. Revolución de Cuba has performed well, particularly in the second half of the year, as we see the results of the initial actions taken as a result of our review of the brand proposition.”
Pitcher added: “It is our young guest base who are the most impacted by the current high inflationary environment.
“Young people have seen the largest fall in real wages since the real value of take-home pay started to fall in May 2022; this has directly impacted their ability to spend on discretionary items such as nights out.
“When able to do so, we are pleased to see our guests still choosing us as their venue of choice, with their propensity to recommend our bars as a great place to go at record levels, however, the strain on their budgets means they are less often able to do so.”
Less reliant on weekends
On the different route to market offered by Peach Pubs, Pitcher said: “The Peach Pubs brand trades well throughout the week and is mainly focused on daytime and early-evening trade, which offers a great diversification for the group, allowing it to be less reliant on weekend and late-night trading.
“The affluent guest base and locations also offer mitigation and balance against recent macroeconomic factors.
“Some of the pubs offer high-margin accommodation for guests with over 80 letting bedrooms.”
He added Peach’s revenue mix is approximately 45:49:6 between drink: food: accommodation.
Recent hot summers have negatively affected the group’s existing brands due to a lack of outdoor space and the impact on late-night trading while Peach offers “extensive, attractive outdoor spaces with a proven track record of increased sales during good weather”.