City Pub Group sees revenues halve as bosses look to ‘rapid’ return to profits on reopening

City Pub Group today said it expects a  “rapid” return to profit on reopening despite seeing revenues fall by more than half in 2020.

The group, which runs 48 premium sites across London, the south and Wales, said income for the year to December 27 was £25.7million, down from £60 million in 2019. 

The AIM-listed publican is burning £300,000 per month in lockdown, but said it has was positioned to emerge strongly from the pandemic having pared back director pay and reached “sensible” deals with landlords.

The group has furloughed most staff and recently secured a further £5 million in Government-backed loans. Executives said the firm has  sufficient liquidity to last “well into 2022 if necessary” and “actions to enhance and improve the business during the pandemic will enable [it] to rapidly take advantage of pent-up consumer demand and opportunities that will undoubtedly emerge.”  

Chairman Clive Watson said decisions on “fundraising, cost control, streamlining of the business, and strengthening of the Board has resulted in a very strong balance sheet, good levels of liquidity, a strengthening of our business model, a more focussed proposition”.

He also said the firm is still eyeing long-term expansion.

“I look forward to a time when I can announce to shareholders that we are on the acquisition trail again, but this will only be considered once we are hitting high levels of optimisation from our existing capacity," he said.

Analysts at Liberum noted that the firm’s actions during the pandemic “bodes well for recovery and return to the acquisition trail”.

Shares were up 5% in early trading.