Stonegate Reports £746m Loss As Pandemic Closures Hit Sales

The UK’s largest pub company, the Stonegate Pub Company, which currently employs 16,000 people, has an estate of over 1200 managed sites and 3200 leased and tenanted sites, has reported a pre-tax loss of £746m in its latest financial results, compared to a £26m loss the year before. The company’s recorded a loss is they say primarily due to estate depreciation and costs arising from its 1.27 billion acquisition of Ei group in March 2020.

During the 52 weeks ended 27 September 2020, the company, which has a portfolio including the Be At One and Slug & Lettuce brands, also said Covid restrictions on pubs had a “significant impact” on the group’s liquidity, with all its pubs closed during the national lockdown and saw restricted trading for the remaining months of the financial year and revenues causing sales to fall by 17% to £707m.

The company said that it had benefited from £70m in state support, with £62m income from the furlough scheme, £4m from the government’s “Eat Out to Help Out” initiative last summer and £3m benefit from business rates relief.

Despite receiving a £50m cash injection from owner TDR Capital, it said legislation, utility costs, business rates and leasehold rents raised an ongoing risk to the business and “the events and future uncertain effect on trading arising as a result of the Covid-19 outbreak indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern.”

Should the country be forced into a further lockdown this winter, the group said it would have insufficient liquidity in January 2022 and may have to resort to selling assets or raising new debt or equity.