New pubs boost Capital Bars' turnover

Capital Bars today reported an increased turnover of €42.7 million, compared to €41 million in the 18 months to October 2000.

The company, which operates 11 bars and restaurants and three hotels in Dublin, reported a pre-tax loss for the 18 months of €2.95 million compared with a profit of €1.3 million for the 12 months to April 4th 1999.

Capital Bars also announced it has agreed a takeover offer worth 33.6 cents a share from Full Circle Investments, a bid vehicle set up by Capital Bars chief executive Mr William O'Dwyer and non-executive director Mr Desmond O'Dwyer.

The offer values the current issued capital of Capital Bars at €11.4 million and the enlarged share capital at €19.2 million. It is at a 56 per cent premium to Capital Bars' closing share price of 21.6 cents on November 16th, the day before it received the offer approach.

Full Circle said it received undertakings to accept the offer from shareholders representing 48 per cent of the share capital.

The undertakings cease to be binding if Capital Bars receives a competing offer before December 28th and if such an offer is recommended by Mr Robert Gunlack and Mr Robert Breare.

Group chairman Mr Robert Gunlack said the underlying turnover increase for the 12 month period was 30 per cent which reflected the contribution from new openings/acquisitions in 2000 including; Trinity Capital Hotel; Bobs Bar, Fireworks; Coyote Lounge; Planet Hollywood; and in 2001 Sosume.

Like-for-like turnover in the period was however down one per cent, he added.

Group EBITDA (earnings before interest, tax, depreciation and amortisation) for the year was €3.1 million, an increase of €1.1 million on the prior 18 months, which included losses from UK operations.

Operating profits from continuing operations were €0.9 million; this compares with €2.2 million in the 18 months to October 2nd 2000. Operating profits are stated after exceptional severance costs of €300,000.

Mr Gunlack said results have been significantly affected by abnormal issues, most of which are now behind the group.

In addition to rent reviews and the increased strength of sterling against the punt, the group has had to absorb very substantial wage increases in line with its trade association's recommendations.

This occurred simultaneously with the imposition of a price freeze on core products by the Government in July 2000 which prevented the company from countering increased costs.

The board said it does not propose to declare a final dividend for the period.