The proposals received support from over 88% of creditors, with the CVA specifically concerning a subsidiary of Revolution Bars Group known as Revolution Bars Limited, which comprises 51 Revolution-branded leasehold bars.
In total the group operates 72 UK sites under the Revolution and Revolución de Cuba brands.
As well as exiting six bars imminently, turnover-based rental terms have been agreed for seven other sites with minimum rental thresholds for the duration of the two-year CVA period.
The group estimates that its cash flows, before one-off costs of implementing the CVA of approximately £1.1m, will improve over the two-year period of the CVA by around £4m.
Net bank debt is currently £13.5m compared to current committed bank debt facilities of £37.2m, which reduces to £29.3m at the end of March 2021 and to £28.1m at the end of June 2021.
Under the terms of the CVA, £1.3m of rent and service charge arrears will be paid on 20 November 2020.
The group’s cash burn rate, if all the group’s bars are subjected to an enforced closure and assuming the continuation of the current Job Retention Scheme and other government reliefs, is estimated at approximately £400,000 per week.
Following the completion of the CVA process, Mike Foster, chief financial officer, has indicated he will not seek re-election and will step down on 22 December.
Danielle Davies, who joined the group in July 2020, will be appointed.
She was previously CFO at Footasylum and director of finance at Pets at Home, and in senior financial positions at Matalan and the Co-Op.
“I’m grateful for the support of our creditors in approving the CVA of Revolution Bars Limited providing the opportunity for the business to move forward with much greater certainty for all its stakeholders," said chief executive Rob Pitcher.
"This is a positive step in the right direction for the business.
“However, whilst we welcome the support Government has given, the hospitality sector has been severely affected by their often illogical, inappropriate and disproportionate response to the coronavirus pandemic. To plan ahead, we still require guidance on how the sector can ultimately exit the current restrictions in a safe and timely manner.
“With phase one of the vaccine rollout potentially commencing in December and set to protect 99 per cent of the UK’s at-risk population, we have some potential indication of a timeline to normality which will save jobs and allow us to resume delighting our customers again .
“Throughout this pandemic the safety and welfare of our teams and our guests has remained our primary focus and I would like to recognise the integrity and determination shown by all our colleagues over the last eight months.”
