Stonegate registers £746m loss amid pandemic pub closures
According to reports by The Financial Times (FT), while the operator of more than 4,700 pubs under brands such as Slug and Lettuce and Craft Union expects normal trading to return from July, it warned a winter lockdown would force it to consider raising more debt or selling assets.
The group recorded a £746m pre-tax loss largely due to estate depreciation and costs stemming from its £1.27bn acquisition of Ei Group in March 2020 – which made Stonegate the largest pub operator in the UK.
The pub company, which employs some 17,000 people, comprises an estate of 1,270 managed division sites and 3,200 leased and tenanted venues.
Published on Companies House, Stonegate’s accounts reveal the operator’s revenues fell by 17% to £707m in the year to the end of September 2020.
The same period, during which Britain’s pubs were shuttered between March and July, saw Stonegate slash costs and benefit from £70m in state support – comprising £62m from the furlough scheme, £4m from the Government backed Eat Out to Help Out initiative in August, and a £3m boost from business rates relief, according to The FT.
Sector losses
News of Stonegate’s pre-tax loss comes after the operator of Toby Carvery and All Bar One, Mitchells & Butlers, revealed it had secured gross proceeds of £350.5m from shareholders as it bids to weather to Covid-19 pandemic.
The 1,700-site group had previously revealed a £300m swing from pre-tax profit to loss in the 52 weeks ended 26 September 2020 – a period in which it was forced to axe 1,300 staff members.
What’s more, Urban Pubs & Bars recently revealed that it lost out on £2.5m in sales in the first month of lockdown and incurred a significant shortfall in profit due to its inability to mitigate costs immediately at the point of closure, according to reports by MCA Insight.
Outdoor hospitality is poised to reopen from 12 April as per the Government’s lockdown roadmap with indoor trading slated to resume from 17 May at the earliest.
The British Beer and Pub Association estimates that some 2,000 pubs, 2.1bn pints in beer sales and £8.2bn in trade have already been lost due to enforced closure and restricted trading over the past year.
