Revolution bars, which currently operates 69 bars under its Revolution, Revolucion de Cuba brands, Founders & Co and Playhouse brands, has acquired the 21-strong premium Peach pub company with a view to diversifying its growth strategy.
Revolution Bars is to pay £16.5m for Peach Pub, although £500,000 is contingent on future performance.
Peach Pub currently has 21 food-led pubs in the south of England and the Midlands. Food is 53% of sales and there are also revenues from accommodation.
This year, like-for-like sales are more than 10% higher than in 2019. In 2021, Peach Pub generated pre-tax profit of £2.7m, but that was boosted by government assistance. There should be £1.5m of cost savings from combining the businesses at a minimal cost, but they will not be fully achieved until 2024-25.
In the year to 2 July 2022, Revolution Bars revenues were £140.8m and it moved from a loss to a pre-tax loss of £2.1m. Like-for-like growth was 1.3%. There was weaker trading in the fourth quarter. Train strikes and heatwaves have hit the start to the new financial year and like-for-like sales are 10% lower in the first eleven weeks.
The consideration will be funded by the Revolution Bars debt facility and leaves headroom of more than £15m. Revolution Bars will not be opening six new sites this year as previously expected.
This is an exciting and transformative opportunity for Revolution. It broadens our guest base, balances our day part sales and seasonality whilst providing another avenue for growth both organically and by acquisition,” says Rob Pitcher, CEO at Revolution Bars Group.
“Peach is a quality business with great pubs offering a premium experience. It has rebounded strongly from the dark days of the pandemic. Central to this success has been a strong people focused culture with clear values that are focused on making the right choices for guests and our teams, a very similar approach to that taken at Revolution.”
