The Rooney Anand-led business and subsidiaries (RedCat Group), which appointed administrators last week for its RedCat Leased Pubs Limited arm, posted the loss in its results for the 52-week period ended 3 April 2023 – an increase from the £3.2m pre-tax loss reported for the 64-week period ended 3 April 2022.
Meanwhile, turnover at RedCat Group was £120.5m (£62.8m: 2022), gross profit was £89.2m (£47.2m: 2022) and adjusted EBITDA (earnings before interest, taxation, depreciation and amortisation) stood at £3.6m (£7.2m: 2022).
During the period, RedCat acquired 17 sites and closed three, and anticipates improved trading across the portfolio, despite economic conditions.
It has also continued to invest in its current estate, including the refurbishment of four sites during the financial year.
It added it has disposed of seven smaller sites since the end of the financial period, taking the total number to 114.
Satisfied with results
RedCat director Michael Rothwell said: “In the context of the challenging economic backdrop, the directors are satisfied with the results of the group.
“The group has continued to seek to acquire good-quality, freehold assets and has grown significantly over the period, deploying further targeted capital investment to enhance the quality and earnings potential of the portfolio.”
He added economic headwinds such as the cost-of-living crisis, food cost inflation, war in Ukraine, inflation, energy prices and availability of “quality people” have all had an effect on the business during the financial period.
Rothwell said: “The group has grown substantially since its first site acquisition in May 2021, driven by significant equity investment and alongside borrowings from both shareholders and the group’s banking syndicate.
Strong support
“Despite the challenging external backdrop, the group is fortunate to benefit from the strong support of its shareholders and banks and has worked collaboratively to ensure that the facilities in place are appropriate.
“During the winter of 2023, the group has undertaken extensive modelling of the outlook for future trading on a site-by-site basis for the existing estate, alongside a full analysis of inflationary cost pressures, particularly relating to energy costs.
“Through this modelling, the group has created a detailed cash flow forecast covering the next 12 months and beyond. The group has also considered various downside scenarios and potential mitigating actions and is satisfied that even in the event of these downside scenarios the group will continue to meet its liabilities as they fall due.
“As at the date of approval of these financial statements, the group believes it can operate within its covenant structure for the next 12 months and has secured the written support of Oaktree Capital Management to provide equity support as required to achieve covenant compliance and also to provide funding as required to support the trading operations and working capital requirements.”
