The Revel Collective warns over 'damaging' £4m hit from Budget measures
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The Revel Collective, formerly known as Revolution Bars Group, has issued a warning that the late-night bar scene remains difficult as younger patrons cut back on spending, and it's bracing for a "very damaging" blow from recent Budget decisions. The company, which rebranded last October, disclosed that its annual profits are expected to take a £4m hit due to the Government’s decision to hike national insurance contributions and the minimum wage.
It also mentioned that the "uncertainty" surrounding its restructuring plan is still affecting trade, while the anticipated bounce-back in bar sales has been more sluggish than hoped. "Although there has been some gradual improvement in sales in our Revolution brand, the late night market continues to be challenging, and sales have not yet recovered as quickly as we had anticipated," the group commented.
With these cost and trading challenges, it now predicts underlying earnings of £2m to £4m for the year ending in June, down from £3m in underlying earnings reported for 2023-24. Shares took a nosedive, dropping 25% in Wednesday morning trading. Rob Pitcher, chief executive of Revolution Bars Group, expressed his concerns: "The newly elected Labour Government’s recent budget announcements, especially the reduction in the national insurance thresholds for employers, will have a very damaging impact on the group.
“These measures are regressive and offer no clear pathway for economic growth within the hospitality sector. They also pose risks to the employment market. We strongly urge the Government to reconsider this policy in particular and explore more balanced alternatives.".
