Creditors approve Revolution Bars CVA

(Sharecast News) - Revolution Bars said that more than 88% of its creditors had voted in favour of the company voluntary arrangement it announced last month, which will lead to the imminent closure of six bars.
Reduced rental terms have been agreed in respect of seven other bars that are now subject to turnover-based rents, with minimum rental thresholds for the duration of the two-year CVA period.

Revolution Bars announced plans for the CVA in October, noting that its revenues had taken a hit from the government's 10pm curfew. It said at the time that sales in the five weeks to 24 October had reduced to 49.4% of last year's level, having been at 72.5% between 4 July and 29 August.

Chief executive Rob Pitcher said on Friday: "I'm grateful for the support of our creditors in approving the CVA of Revolution Bars Limited providing the opportunity for the business to move forward with much greater certainty for all its stakeholders.

"This is a positive step in the right direction for the business. However, whilst we welcome the support government has given, the hospitality sector has been severely affected by their often illogical, inappropriate and disproportionate response to the coronavirus pandemic."

While all of its bars in England are closed until at least 3 December due to the national lockdown, Revolution reopened two bars in Wales this week and three of its seven Scottish bars last week following the lifting of restrictions in those countries. The company's bar in Northern Ireland will remain closed until 27 November.

Revolution said it expects its cash flows before one-off costs of around £1.1m to implement the CVA will improve over the two-year period by around £4m. Net bank debt is currently £13.5m compared to current committed bank debt facilities of £37.2m, which reduces to £29.3m at the end of March 2021 and to £28.1m at the end of June 2021.

Under the terms of the CVA, £1.3m of rent and service charge arrears will be paid on 20 November.

"Whilst there remains significant uncertainty due to the pandemic, the board is very encouraged by the welcome news of a Covid-19 vaccine potentially becoming available by Christmas, which suggests revenue generation may return to more normal levels through the course of 2021," it said.

Revolution also announced that chief financial officer Mike Foster will not seek re-election and will step down at the annual meeting in December. He will be succeeded by Danielle Davies, who joined the group in July as part of its long-term succession planning process.

Most recently, Davies was CFO at Footasylum and director of finance at Pets at Home.