Oakman Group eyes “substantial” profits as it bounces back from Covid losses

Betsey Wynne, Swanbourne 3

The Oakman Group said it is on course to make a “substantial” EBITDA profit in 2020/21 after running up losses of almost £14m during the pandemic.

The pub and hotel chain said Covid led to it posting a £2.6m EBITDA loss for the latest financial year ending June 2020, with total losses reaching £13.9m.

While the costs of the closure impacted on these results, the government support did not produce a benefit until after the year-end, it said.

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Oakman closed the year with net liabilities of £10.8m, a figure that increases to positive assets of £13.6m after reclassification of shareholder loans as shareholder funds.

The company said there has been significant post-balance sheet activity and it remains “stable, well-funded and ready for further growth”.

£9m of equity has been raised post year-end, split between £4.9m of new funds and £4.1m of shareholder loan conversions.

Pledges have been received for at least a further £4.8m of loan conversions.

The damage to the cashflow from the second and third lockdown has been entirely offset by significant government support in the form of a VAT cut on food and accommodation, business rates cuts and, to a lesser degree, grants.

The group will have opened eight new sites by the end of June, bringing the total number of sites to 35.

Oakman has a substantial pipeline and expects to have 40 operational sites by the end of its next fiscal year.

Sales in the first week after reopening indoors were very strong with like-for-like sales up 38% and total sales up 71% versus the same week two years ago with average sales per fully invested Oakman Inn hitting £45,000 net of VAT.

Executive chairman, Peter Borg-Neal, said: “We believe that hospitality has been closed and restricted to a far greater extent than was necessary but now is the time to look forward to the future and play our part in rebuilding the economy.

“We are very well-placed to take advantage of the strong consumer demand we anticipate in the year ahead and are placing no limitations on the scale of our ambition.”

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Tags : Oakman Inns & RestaurantsPubs
Andrew Seymour

The author Andrew Seymour

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