Prezzo in Harrogate to be spared from closure
Restaurant chain Prezzo has revealed that the Harrogate branch will be among those avoiding closure under proposals put to it's creditors.
Restaurant chain Prezzo has revealed that the Harrogate branch will be among those avoiding closure under proposals put to it’s creditors.
A proposed Company Voluntary Agreement (CVA) published over the weekend revealed the Albert Street branch will not be among the 94 to close nationwide.
The document outlines that the company is facing revenue and sales decline while also owing secure creditors, including Â£29 million to Barclays Bank.
Jon Hendry-Pickup, CEO of Prezzo, said: “Prezzo’s core business today is fundamentally strong and has fantastic potential. However, the well-documented pressures on our industry mean a number of our restaurants are under-performing. While we continue to be profitable and cash-generative, our position is not sustainable, so we must take decisive action now to ensure we’re able to thrive in the future.”
“While the 208 restaurants that make up that core will continue to trade as normal, the company expects that 94 will be closed as part of the process. Closures are expected to commence from April 2018. Every effort will be made to redeploy those team members affected by the closures.
He added: “We recognise this process will impact many of our team members and their families. We are committed to keeping them informed, and will be doing all we can to support them during this difficult time.”
The plan proposes measures including ‘seeking rent reduction from landlords’ and ‘exiting those restaurants that cannot be made viable even with a rent reduction’. The Ripon branch at Market Plan is one of those believed to be closing .
Harrogate was identified as a ‘category two’ site, which is not currently profitable due to the current amount of rent paid. A 25 per cent reduction for 24 months is proposed as part of the CVA.
Shareholders will still however have to approve the plan, with a minimum of 75 per cent needed for it to go ahead.
Closures are expected to begin from April according to the company.
This story will be updated as more details are made available.