REG - Various Eateries PLC - Final Results
04/02/2025 07:15
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RNS Number : 7422V Various Eateries PLC 04 February 2025
4 February 2025
VARIOUS EATERIES PLC
("Various Eateries" or "the Company"
and with its subsidiaries "the Group")
Final Results
52-week period ending 29 September 2024
Resilient trading with growing momentum as the year progressed
Various Eateries PLC, the owner, developer and operator of all day clubhouse,
restaurant and hotel sites in the United Kingdom, announces its results for
the 52 weeks ended 29 September 2024.
Financial Highlights
· Revenue growth of 9% to £49.5m (2023: £45.5m), largely driven by new site
openings
· Adjusted EBITDA* profit of £0.3m (2023 loss of £2.2m), due to solid trading
performance and significant operational improvement.
· Cash at bank of £5.8m (2023: £1.9m)
· Total loss before tax of £3.4m (2023: loss of £6.7m)
· Net cash of £2.7m (2023: net debt of £11.6m)
Operational Highlights
· £10.1m fundraise in H1 to support rollout plans and working capital
· Successful opening of two new sites, Coppa Club Cardiff and Noci Richmond
· Key areas of leadership were strengthened to support the Group's long-term
objectives.
· Adaptations to site portfolio to enhance year-round usability regardless of
weather conditions
· Completed key operational initiatives such as streamlining supply chain,
renegotiating supplier agreements and enhancing resource management
Post-period Highlights & Outlook
· Strengthened leadership structure
o Appointment of Mark Loughborough as CEO
o Andy Bassadone transitioned from Executive Chairman to Executive Director
o Glyn Barker transitioned from Non-Executive Director to Non-Executive Chairman
· Solid start to FY25 including a strong festive period reinforces confidence in
the Group's trajectory
* Adjusted EBITDA is EBITDA before pre-opening costs, share-based payments,
gains and losses on property and restructuring costs, and is reported by the
Group before the impact of IFRS 16
Glyn Barker, Non-Executive Chairman of Various Eateries, said:
"This year was one of steady progress and strengthening our foundations for
future growth. A great deal of hard work has taken place behind the scenes to
fine tune our operations and enhance our estate, all while taking steps to
navigate industry challenges. In that context, returning to an adjusted EBITDA
profit is a great achievement and stands the Group in good stead moving
through FY25.
"The sector has experienced a tough few years, but we are encouraged by early
signs of stabilisation. The measures outlined in the Autumn Budget create new
challenges for businesses, but our disciplined approach to cost management and
the operational efficiencies we've achieved ensure we are well-placed to
manage them.
"Looking ahead, supported by a robust cash position and a strengthened
leadership team, we will maintain our commitment to quality and innovation and
are confident in our ability to deliver sustainable growth in the new
financial year and beyond."
Annual General Meeting and Posting of Results
The Company confirms that it intends to distribute its Annual Report and
Accounts and notice of Annual General Meeting to shareholders shortly. A
further announcement will be made at that time. A copy of the annual report
and accounts will also be available from the Company's website at the same
time (www.variouseateries.co.uk (http://www.variouseateries.co.uk/) ).
Contacts
Various Eateries plc Via Alma
Mark Loughborough (Chief Executive Officer)
Sharon Badelek (Chief Financial Officer)
Zeus (Sole Broker & NOMAD) +44 (0)20 3829 5000
Harry Ansell (Broking)
Antonio Bossi (NOMAD)
Darshan Patel
Alma Strategic Communications +44 (0)20 3405 0205
David Ison variouseateries@almastrategic.com (mailto:variouseateries@almastrategic.com)
Rebecca Sanders-Hewett
Will Merison
About Various Eateries
Various Eateries owns, develops and operates restaurant, clubhouse and hotel
sites in the United Kingdom. The Group's stated mission is "great people
delivering unique experiences through continuous innovation".
The Group operates two core brands across 20 locations:
Coppa Club, a multi-use, all day concept that combines restaurant, terrace,
café, lounge, bar and work spaces.
Noci, a modern pasta-led concept which serves very high-quality dishes at
reasonable prices.
For more information visit www.variouseateries.co.uk
(http://www.variouseateries.co.uk/) .
Chairman's Statement
Overview
FY24 was a year of steady progress for Various Eateries, marked by a solid
trading performance and significant operational improvement. Despite ongoing
challenges in the hospitality sector, this ongoing focus on operational
improvement and service excellence enabled us to deliver a return to adjusted
EBITDA profit.
The successful placing at the start of the period raised £10.1m which
significantly improved our cash position. This ensures we have the liquidity
to support the future roll out of new sites.
A dynamic hospitality group with compelling growth opportunities
Various Eateries' strategy is focussed on the expansion of our two core
brands, Noci and Coppa Club. The distinct identity of each brand fills
specific gaps in the market, which have significant potential for expansion.
Noci is our specialist neighbourhood fresh pasta restaurant. Currently our
sites are in London and Greater London. Created to address the void left by
the closures of many high street Italian restaurants, Noci focuses on
delivering high-quality fresh food at affordable prices.
Coppa Club was founded to provide a members' club-like space without
membership fees. Capitalising on remote work trends and the growing demand for
all-in-one all-day venues, Coppa provides spaces to eat, drink, meet, work and
stay the night. With 13 venues, from city centre to countryside locations,
Coppa suits all occasions from morning through to evening.
The hospitality sector has been under pressure for several years, leading to a
rise in the availability of prime sites, which in many cases includes existing
high-end fit outs. Increased uncertainty in recent years provides Various
Eateries with an opportunity akin to the casual dining revolution of the
1990s.
Resilient trading performance with notable improvement as the year progressed
Group revenues grew to £49.5m (2023: £45.5) and other operating income of
£1.2m (2023: £nil) includes a business interruption insurance claim in
relation to Covid-19. We generated a positive adjusted EBITDA of £0.3m (2023:
negative adjusted EBITDA of £2.2m).
Group like-for-like sales grew by 1% in the second half compared to the
previous year. The final quarter saw a 4% increase, despite above-average
rainfall, improving overall performance from -3% at the half-year mark to -1%
by year-end.
Both brands performed steadily overall, with some sites achieving particularly
strong results offsetting those yet to reach maturity or impacted by external
factors such as adverse weather. Our new Head of Operations drove meaningful
progress in conversion rates, particularly across the Noci estate, with
notable improvements in site profitability. Investments in the outdoor spaces
across the Coppa Club estate, designed to increase all-weather use,
significantly boosted footfall and are expected to continue to underpin the
brand's year-round appeal.
Tavolino continued to perform strongly, delivering increased EBITDA growth of
33% year on year.
The Group's financial position remains healthy, with cash at bank at 29
September 2024 of £5.8m (2023: £1.9m).
Navigating cost pressures and driving efficiency while maintaining quality
The industry-wide pressures of increased employer National Insurance
contributions and National Living Wage are being carefully navigated by
management to minimise their impact, alongside an intensification of the drive
towards greater efficiencies that has been underway within the Group for some
time.
During the period, our recently appointed Head of Procurement successfully
refined the supply chain and has started to optimise supplier agreements.
While food and utility prices continued to ease in the year, the consumer
spending landscape remained uncertain, and the workforce cost increases in the
2024 Autumn Budget will increase challenges for the whole sector.
Encouragingly, despite pressures on consumer spending, higher-priced menu
items continued to perform well.
We will remain focussed on continuing to seek ways to streamline our
operations and be more productive without compromising the quality of our
offering.
Strategic expansion, innovation and greater resilience across our estate
Two new sites were opened in the period, delivering on our strategy to expand
both brands when attractive long-term opportunities present themselves.
Coppa Club Townhouse Cardiff opened in May 2024 and traded well, with high
footfall and revenue resulting in multiple standout weeks. The city centre
position has also meant that the downstairs bar has also been able to fully
capitalise on crowds attending events at the Principality Stadium.
The opening months at Noci Richmond, which also opened its doors in May, have
been encouraging and we remain confident its popularity will continue to
increase as its reputation grows among locals.
It was a challenging year from a weather perspective across the estate,
characterised by an unusually wet spring and the coldest summer since 2015.
To counteract this and to help mitigate weather related disruption in future
years, a lot of work has taken place to transform the outdoor spaces at many
of our sites. This is typified by the successful addition of The Lobster Bar,
a covered BBQ area by the riverside, at Coppa Club Streatley. We also
introduced a new covered drinking terrace at Coppa Club Cobham and invested in
more outdoor igloos across the estate.
The introduction of a winter-themed feature, including a snow machine, at
Coppa Club Tower Bridge exemplifies our commitment to creative initiatives to
enhance the customer experience. Already benefiting from the resurgence of
tourism in central London, the site achieved its highest-ever sales week
post-period.
While the Group's large outdoor spaces mean the weather will continue to be an
important variable, the steps we have taken to reduce dependency on favourable
conditions and balance performance across seasons stands us in good stead for
the future.
We are exploring further site openings in FY25. We will continue our
disciplined policy of proceeding only where our analysis provides strong
support for the potential likely financial return.
Strengthening leadership for the next phase of growth
As already mentioned, we made significant progress last year on improving
operational efficiency and the quality and consistency of customer experience.
However, there is still much to be done in both areas and the Board decided to
seek new, experienced leadership to drive forward the next phase of our
development. We were delighted to announce in January 2025 the appointment of
Mark Loughborough as Chief Executive Officer and a Board Director. Mark brings
over three decades of hospitality experience, including an influential tenure
at Young & Co Brewery PLC, where, as Retail Director, he was responsible
for significant financial and operational success. His strategic vision, focus
on efficiency, and proven ability to drive profitable growth align perfectly
with our priorities.
Andy Bassadone has transitioned from Executive Chairman to Executive Director
releasing more time for him to focus on one of our key priorities - the
development and expansion of Noci. I have assumed the role of Non-Executive
Chairman having previously been Non-Executive Director.
Key areas of leadership were also strengthened elsewhere in FY24 to support
the Group's long-term objectives.
Current trading and outlook
We approach the year ahead with confidence in the business and faith in our
ability to navigate the continued challenges of an ever-evolving sector under
our new leadership. Thanks to the substantial efforts invested in
strengthening our organisational structure and enhancing our site portfolio,
the Group is steadily regaining momentum.
The rises in Employer National Insurance contributions and Minimum Wage have
had a negative impact on everyone in the industry and will ultimately result
in reduced disposable income for consumers as costs are passed on. However,
with enhanced cost discipline and a robust cash balance, we are in a strong
position.
While we will remain vigilant in monitoring the trading environment and ready
to adapt to any shifts, the solid start to the new financial year including a
strong festive period reinforces our confidence looking forwards. We are
currently trading in line with market expectations for FY25 and remain
optimistic that it will be another year of progress.
Financial Review
Overview
The KPI's of the Group's performance are summarised in the table below:
52 weeks ended 52 weeks ended Change
29 September 2024 1 October 2023
£ 000 £ 000 %
Revenue 49,486 45,495 9%
Adjusted EBITDA (before impact of IFRS 16)* 300 (2,189) 144%
Adjusted EBITDA* 4,355 1,556 279%
Operating Loss (928) (4,207) (78%)
Total loss for the year after tax (3,357) (6,677) (50%)
Basic and diluted earnings per share (pence) (2.0) (8.1) (75%)
Cashflow from operating activities 2,311 2,082 11%
Net cash/(debt) excluding lease liabilities 2,690 (11,609) 123%
Number of sites 20 18 11%
* not audited
Summary of financial performance for the 52 weeks ended 29 September 2024
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
£ 000 £ 000
Reconciliation of loss before tax to Adjusted EBITDA*
Revenue 49,486 45,495
Loss before tax (3,357) (6,677)
Impairment on property, plant and equipment 636 -
Reversal of impairment on property, plant and equipment (1,574) -
Net financing costs 2,429 2,470
Depreciation and amortisation 5,502 5,571
EBITDA before exceptional costs 3,636 1,364
Pre-opening costs 337 859
Share-based payments 391 69
(Profit)/loss on disposal of assets and leases (9) 37
Gain on early surrender of lease - (899)
Restructuring costs - 126
Adjusted EBITDA 4,355 1,556
Adjustment for rent expense (4,055) (3,745)
Adjusted EBITDA (before impact of IFRS 16) 300 (2,189)
* not audited
FINANCIAL PERFORMANCE
Overall Group revenue increased by 9% (FY24: £49.5m, FY23: £45.5m). During
the year the Group recognised £1.2m of other operating income which was
largely derived from an business interruption insurance claim in relation to
Covid-19. The Group's adjusted EBITDA increased by £2.8m, from £1.6m in FY23
to £4.4m in FY24. During the year, the Group focused on driving profitability
through contract renegotiations and smarter rostering which has
significantly contributed to its EBITDA growth despite challenging market
conditions.
The loss after tax has decreased from £6.7m in FY23 to £3.4m in FY24. In
FY24 the Group incurred impairments to goodwill of £nil (2023: £nil),
right‑of‑use assets of £0.3m (FY23: £nil) and property, plant and
equipment of £0.3m (2023: £nil). The Group recognized impairment reversals
to goodwill of £nil (2023: £nil), right-of-use assets of £1.2m (2023:
£nil) and property plant and equipment of £0.4m (2023: £nil). The Group's
depreciation and amortisation charge has decreased by £0.1m (from £5.6m in
FY23 to £5.5m in FY24) and pre-opening costs have decreased by £0.6m (from
£0.9m in FY23 to £0.3m in FY24). The Group's share-based payment charge has
increased by £0.3m (from £0.1m in FY23 to £0.4m in FY24). See note 28 for
more details on share-based payments and note 31 for details on post-year end
share options issue.
Consolidated Statement of Comprehensive Income
For the 52 weeks ended 29 September 2024
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
Note £ 000 £ 000
Revenue 4 49,486 45,495
Cost of sales (46,022) (43,597)
Gross profit 3,464 1,898
Central staff costs (3,397) (3,426)
Share-based payments 28 (391) (69)
Other operating income 10 1,153 -
Impairment of property, plant and equipment 15 (636) -
Release of impairment of property, plant and equipment 15 1,574 -
Gain on early surrender of lease - 899
Profit (loss) of property, plant and equipment 9 (37)
Other expenses 12 (2,704) (3,472)
Operating loss (928) (4,207)
Finance income 6 5 -
Financing costs 6 (2,434) (2,470)
Loss before tax (3,357) (6,677)
Tax 11 - -
Loss for the period (3,357) (6,677)
Earnings per share
Basic loss per share (pence) 13 (2.0) (8.1)
Diluted loss per share (pence) 13 (2.0) (8.1)
The above results were derived from continuing operations.
There are no items of comprehensive income other than the loss for the period
and therefore, no statement of other comprehensive income is presented.
Consolidated Statement of Financial Position
As at 29 September 2024
29 September 2024 1 October 2023
Note £ 000 £ 000
Non-current assets
Intangible assets 14 11,090 11,152
Right-of-use assets 15 25,279 24,873
Other property, plant and equipment 15 26,831 25,397
63,200 61,422
Current assets
Inventories 17 1,146 1,078
Trade receivables 18 244 154
Other receivables 18 3,336 2,082
Cash and bank balances 19 5,829 1,902
10,555 5,216
Total assets 73,755 66,638
Current liabilities
Trade and other payables 20 (13,514) (13,380)
Borrowings 21 (3,139) (13,511)
Net current liabilities (6,098) (21,675)
Total assets less current liabilities 57,102 39,747
Non-current liabilities
Borrowings 22 (27,424) (28,049)
Provisions 23 (188) (358)
Total non-current liabilities (27,612) (28,407)
Total liabilities (44,265) (55,298)
Net assets 29,490 11,340
Equity
Share capital 24 1,750 890
Share premium 72,540 52,284
Merger reserve 64,736 64,736
Employee benefit trust shares reserve (5,012) (5,012)
Retained earnings (104,524) (101,558)
Total funds attributable to the equity shareholders of the Company 29,490 11,340
The financial statements of Various Eateries PLC (registration number:
12698869) were approved by the Board and authorised for issue on
They were signed on its behalf by:
S Badelek
Director
Consolidated Statement of Changes in Equity
for the 52 weeks ended 29 September 2024
Called-up share capital Share premium account Merger reserve Employee benefit trust shares reserve Retained Earnings Total
Attributable to equity shareholders of the Company £ 000 £ 000 £ 000 £ 000 £ 000 £ 000
At 2 October 2022 890 52,284 64,736 (5,012) (94,950) 17,948
Share based payments - - - - 69 69
Total transactions with owners - - - - 69 69
Loss for the period - - - - (6,677) (6,677)
Total comprehensive loss - - - - (6,677) (6,677)
At 1 October 2023 890 52,284 64,736 (5,012) (101,558) 11,340
Share issue 860 20,256 - - - 21,116
Share based payments - - - - 391 391
Total transactions with owners 860 20,256 - - 391 21,507
Loss for the period - - - - (3,357) (3,357)
Total comprehensive loss - - - - (3,357) (3,357)
At 29 September 2024 1,750 72,540 64,736 (5,012) (104,524) 29,490
Consolidated Statement of Cash Flows
for the 52 weeks ended 29 September 2024
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
£ 000 £ 000
Cash flows from operating activities
Loss for the year (3,357) (6,677)
Adjustments to cash flows from non-cash items:
Impairment of property, plant and equipment 636 -
Reversal of impairment of property, plant and equipment (1,574) -
Depreciation and amortisation 5,502 5,571
Gain on early surrender of lease - (899)
(Profit) / loss on disposal of assets and leases (9) 37
Share based payments 391 69
Financing costs (5) -
Financing costs 2,434 2,470
4,018 571
Working capital adjustments:
Increase in inventories (68) (270)
(Increase) / decrease in trade and other receivables (1,344) 327
Increase / (decrease) in accruals, trade and other payables (125) 1,454
Decrease in provisions (170) -
Net cash flow from operating activities 2,311 2,082
Cash flows used in investing activities
Interest received 5 -
Purchases of property plant and equipment (4,317) (6,845)
Net cash flows from investing activities (4,312) (6,845)
Cash flows from financing activities
Interest paid (1,763) (1,627)
Proceeds on issue of shares 21,116 -
Repayment of borrowings (11,409) -
Principal elements of lease payments (2,016) (1,098)
Net cash flows used in financing activities 5,928 (2,725)
Decrease in cash 3,927 (7,488)
Opening cash at bank and in hand 1,902 9,390
Closing cash at bank and in hand 5,829 1,902
Notes to the accounts
4 Revenue
An analysis of the Group's total revenue which all originates in the UK is as
follows:
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
£ 000 £ 000
Sale of goods 45,155 41,437
Accommodation and room hire 4,295 4,025
Sub-let rental income 36 33
49,486 45,495
6 Finance income and costs
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
£ 000 £ 000
Interest income on bank deposits 5 -
Total finance income 5 -
Financing costs on bank overdraft and borrowings 575 897
Lease liability interest 1,859 1,573
Total financing costs 2,434 2,470
Net finance costs 2,429 2,470
11 Tax
Tax charged in the statement of comprehensive income
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
Tax expense £ 000 £ 000
Corporation tax - -
Total current income tax - -
Tax expense in the statement of comprehensive income - -
Corporation tax is calculated at 25% (2023: 25%) of the estimated taxable loss
for the period.
The charge for the period can be reconciled to the loss in the statement of
profit or loss. The tax assessed in the year is lower than the standard rate
of corporation tax in the UK of 25%. The differences are explained below::
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
£ 000 £ 000
Loss before tax (3,357) (6,677)
Corporation tax at standard rate 25.0% (2023: 25.0%) (839) (1,469)
Fixed asset differences - -
Expenses not deductible 271 247
Income not taxable - -
Tax losses carried forward 619 1,160
Movement in deferred tax not recognised (51) 62
Other movements - -
Total tax charge - -
No account has been taken of the potential deferred tax asset of £14,640,000
(2023: £14,628,000) calculated at 25% (2023: 25%) and representing losses
carried forward and short term timing differences, owing to the uncertainty
over the utilisation of the losses available.
12 Other expenses
52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
£ 000 £ 000
Depreciation and amortisation 301 324
AGA release of provision (note 22) (170) 1
Other central costs 2,573 3,147
2,704 3,472
13 Earnings per share
Basic loss per share is calculated by dividing the profit attributable to
equity shareholders by the weighted average number of shares outstanding
during the year. There were no potentially dilutive ordinary shares
outstanding as at the periods ended 29 September 2024 and 1 October 2023.
29 September 2024 1 October 2023
£ 000 £ 000
Loss for the year after tax (3,357) (6,677)
Basic and diluted weighted average number of shares 168,180,186 82,143,398
Basic loss per share (pence) (2.0) (8.1)
Diluted loss per share (pence) (2.0) (8.1)
14 Intangible assets
Group Brand Goodwill Trademarks, patents & licenses Total
£ 000 £ 000 £ 000 £ 000
Cost or valuation
At 1 October 2023 2,912 26,019 25 28,956
Additions - - - -
At 29 September 2024 2,912 26,019 25 28,956
Amortisation
At 1 October 2023 2,850 14,954 - 17,804
Charge for the period 62 - - 62
At 29 September 2024 2,912 14,954 - 17,866
Carrying amount 29 September 2024 - 11,065 25 11,090
14 Intangible assets (continued) Brand Goodwill Total
Trademarks, patents & licenses
£ 000 £ 000 £ 000 £ 000
Cost or valuation
At 2 October 2022 2,912 26,019 25 28,956
Additions - - - -
At 1 October 2023 2,912 26,019 25 28,956
Amortisation
At 2 October 2022 2,788 14,954 - 17,742
Charge for the period 62 - - 62
At 1 October 2023 2,850 14,954 - 17,804
Carrying amount 1 October 2023 62 11,065 25 11,152
Brand relates to registered brand names and is amortised over an estimated
useful economic life of 4 years.
Goodwill is not amortised, but an impairment test is performed annually by
comparing the carrying amount of the goodwill to its recoverable amount. The
recoverable amount is represented by the greater of the individual Cash
Generating Units ("CGU's") fair value less costs of disposal and its
value-in-use.
The goodwill balance relates to Tavolino Riverside (£1,046,000), Strada
Southbank (£992,000), Rare Bird Hotels at Sonning Limited (£2,418,000), and
Rare Bird Hotels at Streatley Limited (£6,609,000). Tavolino Riverside and
Strada Southbank are included within the restaurant operating segment. Rare
Bird Hotels at Sonning Limited and Rare Bird Hotels at Streatley Limited are
included within the hotels operating segment.
The group has no contractual commitments acquisition of intangible assets
(2023: £nil).
Restaurant segment
The key assumptions for the value-in-use calculations are those regarding the
discount rate, trading forecasts and growth rates. A pre-tax discount rate of
8.4% was used (2023: 12.1%), based on the Group's WACC and Beta. Cash flows in
line with forecasts for the next 2 years were used. Cash flows beyond the
forecast period are extended out to the end of the lease terms at a 3% growth
rate.
Impairment testing at 29 September 2024 resulted in no requirement to reduce
the carrying value of goodwill at 29 September 2024, as the recoverable
amounts of the CGUs, based on value-in-use estimates, were greater than the
carrying values.
Given the ongoing global economic uncertainty and its impact on the UK
hospitality sector there is particular sensitivity to the forecasts prepared
in connection with the impairment review as at 29 September 2024. The estimate
of recoverable amount for the restaurant segment is particularly sensitive to
the discount rate and trading forecast assumptions. If the discount rate used
is increased by 2%, the forecast future EBITDA is reduced by 10% and the
terminal growth rate reduced by 1%, a further impairment loss of £nil for the
period ended 29 September 2024 would have to be recognised against goodwill
(2023: £nil). Management is not currently aware of any other reasonably
possible changes to key assumptions that would cause a unit's carrying amount
to exceed its recoverable amount.
Hotel segment
The key assumptions for the value-in-use calculations are those regarding the
discount rate, trading forecasts and growth rates. A pre-tax discount rate of
8.4% was used (2023: 12.1%), based on the Group's WACC and Beta. Cash flows in
line with forecasts for the next 2 years were used. Cash flows beyond the
forecast period are extended at a terminal growth rate of 3% (2023: 3%).
Impairment testing at 29 September 2024 resulted in no requirement to reduce
the carrying value of goodwill at 29 September 2024, as the recoverable
amounts of the CGUs, based on value-in-use estimates, were greater than the
carrying values.
The estimate of recoverable amount for the hotel segment is sensitive to the
discount rate, trading forecast assumptions and terminal growth rate. If the
discount rate used is increased by 1%, the forecast future EBITDA is reduced
by 10% and the terminal growth rate reduced by 1%, no impairment would be
required (2023: £nil). Management is not currently aware of any other
reasonably possible changes to key assumptions that would cause a unit's
carrying amount to exceed its recoverable amount.
15 Property, plant and equipment
Group
Right of use Freehold land and property Leasehold Improvements Furniture, fittings and equipment Assets Under Construction IT equipment Total
assets
£ 000 £ 000 £ 000 £ 000 £ 000 £ 000 £ 000
Cost or valuation
At 1 October 2023 37,622 2,294 21,251 10,134 597 2,342 74,240
Additions 1,751 - 527 790 2,982 18 6,068
Lease modifications 275 - - - - - 275
Disposals (579) - - - - - (579)
Transfers - - 2,365 958 (3,413) 90 -
At 29 September 2024 39,069 2,294 24,143 11,882 166 2,450 80,004
Depreciation
At 1 October 2023 12,749 138 3,543 5,942 - 1,598 23,970
Charge for the period 2,522 40 1,250 1,359 - 269 5,440
Eliminated on disposal (578) - - - - - (578)
Impairment charge 294 - 342 - - - 636
Release of historic impairment charge (1,197) - (377) - - - (1,574)
At 29 September 2024 13,790 178 4,758 7,301 - 1,867 27,894
Carrying amount 25,279 2,116 19,385 4,581 166 583
At 29 September 2024 52,110
15 Property, plant and equipment (continued)
Right of use Freehold land and property Leasehold Improvements Furniture, fittings and equipment Assets Under Construction IT equipment Total
assets
£ 000 £ 000 £ 000 £ 000 £ 000 £ 000 £ 000
Cost or valuation
At 2 October 2022 37,588 2,294 16,293 8,535 573 2,108 67,391
Additions 1,206 - 654 935 5,191 65 8,051
Lease modifications 56 - - - - - 56
Disposals (1,228) - - - (30) - (1,258)
Transfers - - 4,304 664 (5,137) 169 -
At 1 October 2023 37,622 2,294 21,251 10,134 597 2,342 74,240
Depreciation
At 2 October 2022 11,479 - 2,489 4,440 - 1,282 19,690
Charge for the period 2,499 138 1,054 1,502 - 316 5,509
Eliminated on disposal (1,229) - - - - - (1,229)
At 1 October 2023 12,749 138 3,543 5,942 - 1,598 23,970
Carrying amount 1 October 2023 24,873 2,156 17,708 4,192 597 744 50,270
The Group's leasehold premises and improvements are stated at cost, being the
fair value at the date of acquisition, plus any additions at cost less any
subsequent accumulated depreciation. Work in progress relates to capital
expenditure on sites that have not started trading.
Depreciation is charged to cost of sales in the Statement of Comprehensive
Income for property, plant and equipment in use at the trading leasehold
premises. Depreciation on property, plant and equipment used by central
functions is charged to other expenses in the Statement of Comprehensive
Income.
Rental income from subletting right-of-use assets is recognised on a
straight-line basis over the term of the relevant lease. It is netted off
against rental costs and is recognised within cost of sales (2024: £41,000,
2023: £41,000).
15 Property, plant and equipment (continued)
The Group has determined that each site in the restaurant operating segment,
and each of the companies in the hotel operating segment are separate CGUs for
impairment testing purposes. Each CGU is tested for impairment at the balance
sheet date if there exists at that date any indicators of impairment. All CGUs
have been tested for impairment by comparing the carrying amount of the assets
to recoverable amount. The recoverable amount is represented by the greater of
the individual CGU's fair value less costs of disposal and its value-in-use.
Restaurant segment
The key assumptions for the value-in-use calculations are those regarding the
discount rate, trading forecasts and growth rates. A discount rate of 8.4% was
used (2023: 12.1%), based on the Group's WACC and Beta. Cash flows in line
with forecasts over the next 2 years were used. Cash flows beyond the forecast
period are extended out to the end of the lease terms at a 3% growth rate.
Impairment testing resulted in the reduction of carrying amount to recoverable
amount, being value-in-use, for four CGU's in 2024, with the full charge
recognised against the restaurant segment. The split of the charge between the
CGU's and the asset classes are Restaurant 1 £65,000 against right of use
asset, Restaurant 2 £134,000 against right of use asset, Restaurant 3
£97,000 against right of use asset and Restaurant 4 £340,000 against right
of use asset.
Impairment testing also resulted in the reversal of impairments on three CGU's
in 2024, with the full reversal recognised against the restaurant segment. The
split of the reversal between the CGU's and the asset classes are Restaurant 5
£898,000 against right of use asset and leasehold improvements, Restaurant 6
£571,000 against right of use asset and Restaurant 7 £105,000 against right
of use asset.
The CGU's with the least headroom is Restaurant 8 £105,000.
The estimate of recoverable amount for the restaurant segment is particularly
sensitive to the trading forecast assumptions. If the discount rate used is
increased by 1%, the forecast EBITDA is reduced by 10%, and the terminal
growth rate reduced by 1%, an impairment loss of £2,660,000 for the period
ended 29 September 2024 would have to be recognized against right of use
assets (2023: £650,000). Management is not currently aware of any other
reasonably possible changes to key assumptions that would cause a unit's
carrying amount to exceed its recoverable amount.
The Group has no capital commitments (2023: £nil).
Hotel segment
As a result of the headroom identified during the goodwill impairment testing
of the hotel operating segment (see note 13), no impairment charge is required
in respect of the hotel segment.
18 Trade and other receivables
Group Company
29 September 2024 1 October 2023 29 September 2024 1 October 2023
£ 000 £ 000 £ 000 £ 000
Trade receivables 244 154 - -
Prepayments and accrued income 2,183 946 - -
Other receivables 1,153 1,136 - -
3,580 2,236 - -
All of the trade receivables were non-interest bearing, receivable under
normal commercial terms, and the directors do not consider there to be any
material expected credit loss. The directors consider that the carrying value
of trade and other receivables approximates to their fair value.
19 Cash and bank balances
Group Company
29 September 2024 1 October 2023 29 September 2024 1 October 2023
£ 000 £ 000 £ 000 £ 000
Cash and bank balances 5,829 1,902 - -
20 Trade and other payables
Group Company
29 September 2024 1 October 2023 29 September 2024 1 October 2023
£ 000 £ 000 £ 000 £ 000
Trade payables 2,045 3,107 - -
Payables to subsidiaries - - 3,741 2,795
Accrued expenses 4,042 4,205 - -
Social security and other taxes 1,675 1,400 - -
Other payables 1,825 1,377 - -
Lease liabilities due in less than one year 3,927 3,291 - -
13,514 13,380 3,741 2,795
The amounts payable to subsidiaries are interest free and repayable on demand.
21 Current borrowings
Group Company
29 September 2024 1 October 2023 29 September 2024 1 October 2023
£ 000 £ 000 £ 000 £ 000
Borrowings from related parties 3,139 13,511 - -
Borrowings from related parties classed as payable within 12 months includes
two deep discounted bond instruments issued by VEL Property Holdings Limited
and by Various Eateries Trading Limited.
The deep discounted bond instrument issued by VEL Property Holdings Limited
was rolled in July 2024 with a new redemption date of 14 January 2025. The
nominal value at year end is £3,139,000 (2023: £2,902,000). The discount is
recognised between subscription and redemption date, resulting in £54,000 of
accrued financing costs as at the reporting date. The deep discounted bond is
secured by freehold property in the Group.
The deep discounted bond instrument issued by Various Eateries Trading Limited
was settled in full during the year in December 2023 using proceeds from the
debt for equity swap. The principal amount of the loan was £10,609,000.
Interest of £800,000 at 3.75% above SONIA was also settled (2023: 3.75% above
SONIA).
22 Non-current borrowings
Group Company
29 September 2024 1 October 2023 29 September 2024 1 October 2023
£ 000 £ 000 £ 000 £ 000
Lease liabilities due after more than one year 27,424 28,049 - -
The loans and borrowings classified as financial instruments are disclosed in
note 26.
The Group's exposure to market and liquidity risk in respect of loans and
borrowings is disclosed in the financial instruments note.
23 Provisions for liabilities
Group 52 weeks ended 52 weeks ended
29 September 2024 1 October 2023
Authorised Guarantee Agreements ('AGAs') £ 000 £ 000
At start of financial period 357
358
At start of financial period 358 357
(Release)/charge in the year (170) 1
At end of financial period 188 358
The provision relates to the annual rental cost of two (2023: three)
previously operated sites that have been disposed of via assignment of lease
and include Authorised Guarantee Agreements ('AGAs') as part of the assignment
arrangement (see also note 30).
24 Share capital and share premium
Authorised, allotted, called-up and fully paid shares
29 September 2024 1 October 2023
No. 000 £ 000 No. 000 £ 000
Ordinary shares of £0.01 each 175,045 1,750 89,008 890
In December 2023, the Company issued 86,036,788 shares at £0.25 each raising
a total of £21,509,197.
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the
proceeds on the winding up of the Company in proportion to the number of and
amounts paid on the shares held. The fully paid ordinary shares have a par
value of £0.01 and the company does not have a limited amount of authorised
capital.
Employee benefit trust shares reserve
The Group presents these shares as an adjustment to own equity at the period
end date through the employee benefit trust shares reserve, until the point
that the shares are awarded, and cease to be conditional awards of shares. The
award of shares is conditional upon certain vesting criteria, as outlined in
note 28.
25 Retirement benefit schemes
Group personal pension scheme
The Group operates group personal pension schemes for all qualifying
employees. The assets of the schemes are
held separately from those of the Group.
The total cost charged to income of £316,000 (2023: £279,000) represents
contributions payable to these schemes by the Group at rates specified in the
rules of the schemes. As at 29 September 2024, contributions of £40,000
(2023: £34,000) due in respect of the current reporting period had not been
paid over to the schemes.
26 Financial instruments
Group
Financial assets at amortised cost
29 September 2024 1 October 2023
£ 000 £ 000
Cash at bank and in hand 5,829 1,902
Trade and other receivables 1,397 1,290
7,226 3,192
Reconciliation of liabilities arising from financing activities
Lease Liabilities Other Borrowings Total
£ 000 £ 000 £ 000
At start of financial period 31,340 13,511 44,851
New Borrowings/(disposals) (530) - (530)
DDB renewal - - -
Interest charge 1,860 237 2,097
Repayments during the period (1,319) (10,609) (11,928)
At end of financial period 31,351 3,139 34,490
Valuation methods and assumptions
Trade receivables are all due for settlement in less than one year. The
Directors consider that the carrying amount of trade and other receivables is
approximately equal to their fair value due to their short term nature.
Financial liabilities at amortised cost
29 September 2024 1 October 2023
£ 000 £ 000
Trade and other payables 39,263 40,029
Borrowings from related parties 3,139 13,511
42,402 53,540
Valuation methods and assumptions
The Directors consider that the carrying amount of trade and other payables is
approximately equal to their fair value due to their short-term nature. The
fair value of financial liabilities is estimated by discounting the remaining
contractual maturities at the current market interest rate that is available
for similar financial liabilities.
Fair value hierarchy
The tables above detail the Group's assets and liabilities disclosed at fair
value. Using a three-level hierarchy, based on the lowest level of input that
is significant to the entire fair value measurement, all assets and
liabilities shown above are considered to be level 3: 'Unobservable inputs for
the asset or liability'. There were no transfers between levels during the
financial period.
Financial risk management and impairment of financial assets
The Group's activities expose it to a variety of financial instrument risks.
The risk management policies employed by the Group to manage these risks are
discussed below. The primary objectives of the financial instrument risk
management function are to establish risk limits, and then ensure that
exposure to risks stay within these limits.
26 Financial instruments (continued)
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to
continue as a going concern, so that it can provide returns for shareholders
and benefits for other stakeholders and to maintain an optimum capital
structure to reduce the cost of capital.
Capital is regarded as total equity, as recognised in the statement of
financial position, plus net debt. Net debt is calculated as total borrowings
less cash and cash equivalents.
In order to maintain or adjust the capital structure, the Company may adjust
the amount of dividends paid to shareholders, return capital to shareholders,
issue new shares or sell assets to reduce debt.
The Company is subject to certain financing arrangements covenants and meeting
these is given priority in all capital risk management decisions. There have
been no events of default on the financing arrangements during the financial
period.
Credit risk management
The Group's credit risk is attributable to trade and other receivables and
cash with the carrying amount best representing the maximum exposure to credit
risk. The Group places its cash with banks with high quality credit standings.
Trade and other receivables relate to day-to-day activities which are entered
into with creditworthy counterparties.
Market risk management
The Group's activities expose it economic factors, the Directors closely
monitor market conditions and consider any impact on the Group's existing
strategy.
Liquidity risk management
Liquidity risk arises from the Group's management of working capital and the
finance charges and principal repayments on its debt instruments. It is the
risk that the Group will encounter difficulty in meeting its financial
obligations as they fall due.
Management review cashflow forecasts on a regular basis to determine whether
the Group has sufficient cash reserves to meet future working capital
requirements and to take advantage of business opportunities.
26 Financial instruments (continued)
Remaining contractual maturities
The following tables detail the company's remaining contractual maturity for
its financial instrument liabilities. The tables have been drawn up based on
the undiscounted cash flows of financial liabilities based on the earliest
date on which the financial liabilities are required to be paid. The tables
include both interest and principal cash flows disclosed as remaining
contractual maturities and therefore these totals may differ from their
carrying amount in the statement of financial position.
Weighted average interest rate 1 year or less Between 1 and 2 years Between 2 and 5 years Over 5 years Remaining contractual maturities
2024 % £ 000 £ 000 £ 000 £ 000 £ 000
Non-derivatives
Trade payables - 2,045 - - - 2,045
Other payables - 5,867 - - - 5,867
Borrowings - Deep Discount Bond - 3,139 - - - 3,139
Borrowings - Loan 3.75% + SONIA - - - - -
Lease liability 4.5% 3,927 3,718 3,733 19,973 31,351
14,978 3,718 3,733 19,973 42,402
Weighted average interest rate 1 year or less Between 1 and 2 years Between 2 and 5 years Over 5 years Remaining contractual maturities
2023 % £ 000 £ 000 £ 000 £ 000 £ 000
Non-derivatives
Trade payables - 3,107 - - - 3,107
Other payables - 5,582 - - - 5,582
Borrowings - Deep Discount Bond - 12,903 - - - 12,903
Borrowings - loan 3.75% + SONIA 608 - - - 608
Lease liability 4.5% 3,291 3,718 3,733 20,598 31,340
25,491 3,718 3,733 20,598 53,540
The cash flows in the maturity analysis above are not expected to occur
significantly earlier than contractually disclosed above.
28 Share based payments
As at 29 September 2024, the Group maintained one separate share based payment
scheme for employee remuneration (2023: two):
· Various Eateries Company Share Option Plan ("CSOP")
JSOP Scheme 1
In accordance with IFRS 2 "Share-based Payment", the value of the awards is
measured at fair value at the date of the grant. The fair value is expensed on
a straight-line basis over the vesting period, based on management's estimate
of the number of shares that will eventually vest. A charge of £nil (2023:
£nil) has been recognised in the consolidated income statement by the Group
in the period ended 29 September 2024.
The JSOP is part of the remuneration package of the Group's senior management.
Participants in this scheme have to be employed until the end of the agreed
vesting period. Upon vesting, the holder is entitled to purchase ordinary
shares at the market price determined at grant date.
JSOP (Scheme 1)
Number of shares
Granted Exercisable Total
At 1 October 2023 - 2,523,809 2,523,809
Surrendered 19 January 2024 - (2,523,809) (2,523,809)
At 29 September 2024 - - -
At 2 October 2022 - 5,809,523 5,809,523
Lapsed 11 November 2022 - (1,095,238) (1,095,238)
Lapsed 8 September 2023 - (2,190,476) (2,190,476)
At 1 October 2023 - 2,523,809 2,523,809
The fair value of these options granted was determined using a Black-Scholes
model. The following principal assumptions were used in the valuation:
28 Share based payments (continued)
CSOP
A charge of £391,000 (2023: £69,000) has been recognised in the consolidated
income statement by the Group in the period ended 29 September 2024.
CSOP
Number of shares Exercise price per share (£)
At 1 October 2023 1,944,428 various
Surrendered 19 January 2024 (654,167) various
Granted 19 January 2024 13,483,180 various
Granted 6 August 2024 500,000 various
Lapsed 31 January 2024 (45,629) 0.69
Lapsed 8 March 2024 (208,333) 0.69
Lapsed 17 May 2024 (218,182) various
Lapsed 5 July 2024 (250,000) various
Lapsed 23 August 2024 (218,182) various
At 29 September 2024 14,333,115 various
At 2 October 2022 1,240,441 various
Granted 15 November 2022 250,000 0.35
Granted 4 April 2023 642,857 0.28
Granted 17 July 2023 393,442 0.31
Lapsed 11(th) November 2022 (104,167) 1.09
Lapsed 3 October 2022 (136,887) 1.09
Lapsed 30(th) April 2023 (250,000) 1.09
Lapsed 31 July 2023 (91,258) 1.09
At 1 October 2023 1,944,428 various
The fair value of the options is estimated at the date of grant using a
Black-Scholes valuation method. The total estimated fair value of the options
granted during the year to be recognised over the vesting period is
£1,513,000.
28 Share based payments (continued)
CSOP CSOP CSOP CSOP
Grant date 4 April 2023 17 July 2023 19 January 2024 6 August 2024
Vesting period ends 4 April 2026 17 July 2026 19 January 2027 6 August 2027
Share price at date of grant £0.28 £0.31 £0.25 £0.18
Volatility 65.66% 65.66% 65.66% 65.66%
Option life at grant 3 years 3 years 3 years 3 years
Dividend yield 0.00% 0.00% 0.00% 0.00%
Risk-free investment rate 0.87 % 0.87 % 0.87 % 0.87 %
Fair value per option at grant date £0.12 £0.13 £0.11 £0.06
Exercise price at date of grant £0.28 £0.31 various various
Exercisable from / to 4 April 2026/4 April 2033 17 July 2026/17 July 2033 19 January 2027/19 January 2034 6 August 2027/6 August 2034
Remaining contractual life 1.5 years 1.8 years 2.3 years 2.9 years
29 Related party transactions
Transactions with related parties include management charges for services
provided by Osmond Capital Limited, which has common shareholders with
controlling influence with the Company, of £189,000 (2023: £200,000). In
addition, H E M Osmond is the principal lender of the £3,139,000 borrowings
(2023: £12,903,000) and a shareholder with controlling influence of Xercise2
Limited which is a significant shareholder of the Company. A Bassadone is the
lender of £392,000 (2023: £392,000).
As at 29 September 2024, there was £nil (2023: £nil) of accrued cash
interest payable on borrowings from related parties.
Remuneration of key management personnel
The remuneration of the Directors of the Company and its subsidiaries and
other key management, who are the key management personnel of the Group, is
set out below in aggregate for each of the categories specified in IAS 24
"Related Party Disclosures".
52 weeks ended 29 September 2024 52 weeks ended 1 October 2023
£ 000 £ 000
Salaries and other short term employee benefits 547 699
Employer's national insurance contributions 64 87
Post-employment benefits - 21
611 807
31 Post balance sheet events
Share options
In November 2024, new share options totalling 1,500,000 under the CSOP scheme
were issued and will vest over a three-year period to November 2027. One third
were issued at 20.0 pence, the second third were at 22.0 pence, and the final
third were at 24.2 pence.
Share purchase
On 9 October 2024 Hugh Osmond purchased 2,000,000 of shares at a price of 15.0
pence each for a total of £0.3m. As these shares were purchased in the market
no new shares have been issued.
32 Contingent liabilities
Authorised Guarantee Agreements
There are 9 (2023: 9) previously operated sites that have been disposed of via
assignment of lease and include Authorised Guarantee Agreements ('AGAs') as
part of the assignment arrangement. There is a risk that the sites would be
returned if the assigned leaseholders were to default on their contractual
obligations with their respective landlords, the risk of which was heightened
as a result of the coronavirus (Covid-19) outbreak. The total annual rental
cost for these sites is £758,000, of which £188,000 (2023: £358,000) has
been provided for (see note 23). The average remaining lease length is 5
years.
CJRS claim
The Group made material claims under the CJRS schemes in order to support the
business through the pandemic. Given multiple changes to the rules governing
the schemes, as well as the degree of complexity in the various rules, the
Group undertook an external review of past claims to confirm their validity.
The directors are of the opinion that claims made to date are valid and
materially correct and so do not consider the likelihood of material outflow
as a result of this review to be probable.
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