Scores of Britain’s best-known food and drink chains will go bankrupt in late April unless banks provide immediate funding
Scores of Britain’s best-known food and drink chains will go bankrupt in late April unless banks provide immediate funding, the head of the hospitality industry has warned.
Kate Nicholls, chief executive of the UK hospitality trade organization, said further failures are ‘inevitable’ after 80-strong restaurant chain Chiquitos – owned by The Restaurant Group, whose CEO is ex-HBOS banker Andy Hornby – and the 73- outlet Carluccio’s selected administrators.
Nicholls said that short-term bank loans are vital to cover costs pending the arrival of government grant packages.
Struggling: Analysts Say Casual Dining Group, Owns Chain Stores Like Bella Italia and Café Rouge, Among The Most Vulnerable Groups
She added, “Banks are not moving fast enough to bring the money to companies in need. If businesses have to wait two to three weeks for loans, jobs and livelihoods are lost. ‘
Analysts say Casual Dining Group, which owns chain stores like Bella Italia and Café Rouge, is also among the most vulnerable. The company has renegotiated rents, closed sites and debt reductions in the past 18 months.
But last week it revealed a pre-tax loss of £ 65.6 million for the year to May 2019. Chief executive James Spragg told The Mail on Sunday: “We had seen better performance lately, but this is an unprecedented situation and the In the coming weeks, we will work closely with our investors to evaluate our next steps. ‘
Yo, the Asian fast food chain, is in talks with its staff to see how it can save jobs after closing all of its 70 UK establishments following Prime Minister Boris Johnson’s shutdown order.
Mark Brumby, an analyst at Langton Capital, said the informal food industry is in “acute distress” and “busts are likely.” Carluccio’s, which was restructured in 2018, said last week that the coronavirus crisis had “ drained the company’s cash ” and struggled to pay personnel before March.
Chief executive Mark Jones said that the company’s financier – Emirati billionaire Micky Jagtiani, who reportedly invested over £ 100 million over the years – had agreed ‘an additional cash injection’ to the company long enough to access the government scheme to pay 80 percent of labor costs.
But the chain still called on FRP Advisory to handle an insolvency process and was able to file an administration within a few days.