The Liberation Group made a £14m loss in 2020 as the pub operator and brewery saw sales drop significantly due to the pandemic.
Announcing its results for the year to the end of January, the group – which trades as Liberation in the Channel Islands and Butcombe in the UK – said that, despite covid, it was in a strong position “to build upon some firm foundations and strengthen the position we occupy in our respective markets”.
The £14m loss for the 53 weeks to 30 January compares to a £4m loss for the same period in 2019. Group turnover was £68.3m compared to £89m in 2019, down 23%.
Earnings before tax, depreciation and amortisation (known as EBITDA) was a £2.5m loss in 2020 compared to a £7.9m profit the year before.
Commenting on the results, Chief Financial Officer Simon Hope said: “Our trading performance inevitably suffered from the impact of losing 53% of our potential pub trading days overall.
“Within our group £20.7m fall in turnover, we achieved £2.8m (6%) growth in the sales of our Brewing and Distribution business, which highlights the diversified nature of our group with wholesale businesses which maximised sales to the OffTrade and B2C shop and online channels, plus the sales of tobacco in the Channel Islands boosted by the lack of duty free purchases by islanders.
“The £23.5m (56%) drop in the sales of our Pubs & Inns Division was broadly in line with the loss of trading days which highlights the strength of trading performance when we were able to open.
“We are grateful to the three governments of the UK, Jersey and Guernsey for the payroll support made available of £4.3m which allowed us to retain almost all our colleagues through this most difficult of times.
“We were one of the few businesses to successfully claim under our business interruption insurance, recovering £1m within the first two months after the first lockdown, and by diligently claiming government grants amounting to £0.4m from 22 local authorities in the UK and Jersey.
Liberation Group, which runs 56 managed pubs and 64 tenanted pubs, is owned by Caledonia Investments.
It added that it has bounced back this year, giving a trading update over the three months to the end of August.
Commenting on this period, Chief Executive Jonathan Lawson said: “It is extremely pleasing to see all of our channels and geographies recovering strongly since reopening and achieving growth on 2019.
“These 13 weeks see our largest sales volumes over the whole year so it is great to be delighting so many customers over such a critical period for us, with the quality of our food offer, our accommodation and our OBV keg products making huge contributions to our growth.
“But in the longer term there are still many challenges for the sector and for us specifically, with recruitment and supply chain issues causing additional costs and lost opportunity.
“There are also headwinds to come in the future UK tax regime - we continue to lobby the government to convert the temporary VAT reliefs into a permanent reduction and to abolish the inequitable system of business rates.”
Looking ahead, the group said that there were over 30 development projects planned for the next 12 months, encompassing existing and newly acquired managed pubs, tenanted businesses and distribution facilities and breweries.
The most significant investments will see development into food-led pubs and inns including into the estate of 250 rooms.
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