Bar and nightclub operator Luminar Group Hldgs Plc (LON:LMR) saw its shares slump by 27% to 29p today on news of a dire performance in the year to February and the exit of its finance director, Robert McDonald. The group blamed its woes on a catalogue of problems precipitated by the difficult economic climate but added that a strategic review was underway to fix some of its problems. The company’s shares have fallen from a 12-month high of 150p last August after it became clear that trading was getting increasingly difficult.

Luminar runs a portfolio of 87 nightclubs in the UK which mainly trade under the Oceana and Liquid brands. For the year, it posted a pre-tax profit of £4.4m, down from £20.3m in 2009, and is set to endure exceptional costs totaling £127.8m mainly against its 49% holding in 3D Entertainment Group Ltd which called in administrators in February. On a like-for-like basis, sales were down 9.9% on last year, including a 15.4% decline in the second half of the year on the back of lower customer admissions. Sales for the first 10 weeks of the current year are down 19.4% on a same outlet basis.

Luminar pointed out that there were many contributing factors to the market weakness, including the general economic climate, youth unemployment, a highly competitive environment and the severe winter weather. In order to counteract the challenges, Simon Douglas, who was drafted in as chief executive in March this year, is overseeing a strategic review that will look to reappraise the group’s strategy, sell off underperforming sites and strip out another £10m of costs in the coming year.

Among the priorities, the company said it would seek to improve its operational template by improving its music, drinks range and customer service standards. It will also seek to improve its marketing skills to make sure its clubs are fashionable and relevant to customers, as well as develop its central head office infrastructure and improve the use of its assets by extending into new and more prosperous areas.

Mr Douglas said: “Luminar has a very good estate and dedicated people. Whilst our marketplace remains challenging, we believe there is a substantial opportunity to leverage Luminar’s many strengths. By focusing on the operational basics and embracing more modern marketing methods, we will engage and entertain our customers and ensure our offer remains…

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