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Losses at UK’s top 100 restaurant groups increase to nearly £700m a year

Losses recorded by the UK’s top 100 restaurant groups worsen sharply to £673m last year, UHY Hacker Young

The UK’s top 100 UK restaurant groups haemorrhaged losses of £673m in the year to September 2021 – nearly triple what they suffered the year before.

Accountancy firm UHY Hacker Young, which compiled the data based on financial reports filed with Companies House, said more insolvencies within the sector were inevitable but noted that it could put downward pressure on rents and entice new entrants into the market.

While many restaurant businesses were able to keep afloat by CBILS or BBLS lending, they are now having to begin repayment of those loans, putting pressure on their cashflow.

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Additionally, efforts to take advantage of the rebound have been hampered by acute staff shortages.

Peter Kubik, T&R partner at UHY Hacker Young, said: “The end of lockdown has not resulted in a painless rebound in fortunes for the sector. Many restaurants are struggling to pass on increased food and wage costs to customers, which is putting margins back under pressure. Omicron is just the latest setback for an industry hit hard in the last two years.”

“They are also facing the threat of decreased consumer spending due to April’s increase in National Insurance.”

“The government has stepped in to help and provided a great deal of support for the sector but it’s likely that even more will be needed. It’s no surprise that the industry is fiercely lobbying for an extension of its lower VAT rate.”

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Tags : researchrestaurant groupsUHY Hacker Young
Andrew Seymour

The author Andrew Seymour

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