‘Challenging year’ leads to erosion of profit margin for Rick Stein’s group

In its latest financial results covering the period from 3 January 2022 to 1 January 2023, the group reported a loss before tax of £347,000, down from a profit of £3.7m the year before.

The Cornwall-based business operates a portfolio of restaurants, accommodation and cafés including the flagship The Seafood Restaurant in Padstow, which was originally opened by Rick and Jill Stein in 1975.

Writing in the group’s financial report, managing director Ian Fitzgerald described 2022 as a ‘challenging year’ for the hospitality sector.

He said: “The year started off well despite trade being disrupted by the shadow of the Omicron variant of the Coronavirus, but as spring approached the war in Ukraine had a significant impact on our trading environment.

“The rapid increase in our supply chain costs, caused by the volatile energy market, was unprecedented.

“Fish and oil were amongst the most adversely affected commodities and resulted in an erosion of profit margin.”

Fitzgerald also noted a decline in visitor numbers to Cornwall and the shortage of supply in the labour market as factors to detrimentally impact the business.

Turnover for the period was £22.5m, down from £28.3m the year before.

Fitzgerald said the group continues to seek opportunities to maximise the profitability of the core business and has the vision to continue to grow its estate through investment in restaurants and rooms, both of which have seen double digit growth since 2019.

He added that the economic outlook for the year ahead also appears more stable, but noted that the ability to maximise revenue from reduced customer numbers remains a big challenge for the business going forwards.

“Although inflation is still tracking in excess of 8%, we have implemented a number of actions that reduce our exposure to excessive costs and increase our ability to be agile in reacting to our trading environment,” he said.