Carluccio’s takes action to give it ‘fighting chance of survival’: Carluccio’s, the Mark Jones-led company, said it is taking actions, including a pay cut for staff and its executive board, to give it a “fighting chance of survival” while the business is mothballed. Alongside staff only receiving 50% of their wages for March, Jones is set to receive no pay for the month. In a letter to staff, which has since been posted on social media, Jones wrote: “A key part of what the board and I have been trying to do is to ensure a long-term future for the company and the jobs of as many of our colleagues as possible. As part of this we have been forced to close all our restaurants and it has been necessary to put the company into a mothballed state. The rapid decline in sales and closure of our restaurants has exhausted the company’s cash resources and we have been struggling to make the payroll payments this month. Our owner, The Jagtiani Foundation, has been very loyal to the company and has, over the years, invested more than £100m and never taken a dividend. Against this backdrop, it has agreed an additional cash injection that will enable the business to pay about 50% of the March wage costs you are due, but I’m afraid no more. Monthly payroll has been moved to Friday to accommodate this payment. I realise this is going to be a terrible shock to all of you. Importantly, The Jagtiani Foundation is evaluating with us proposals to fund the mothballing of the company for the next few months which, crucially, could enable us to access the proposed government funding scheme to pay 80% of wage costs (up to a maximum of £2,500 per month per employee) and therefore preserve as much value in our business as possible. Their support, if agreed, alongside other actions we’re taking, could give us a fighting chance of securing a future for Carluccio’s and ensure we are able to pay you up to 80% of your wages during the next few months. I’m so sorry we have had to take these actions and I deeply regret the impact this is having on you all. The executive team has agreed to take an even bigger cut in salary and I have decided not to take any salary in March. But I understand this is a very heavy burden for you to bear during these extraordinary times.” In a subsequent statement, Jones told Propel: “The entire restaurant sector is facing unprecedented challenges and Carluccio’s is no exception. These are difficult and very challenging times for our team but we’re doing everything we can and the Carluccio’s board is in constant talks with stakeholders to determine a way forward.” Carluccio’s underwent a company voluntary arrangement in May 2018.
Byron appoints advisers as it looks to shore up balance sheet: Byron, the burger chain led by Simon Wilkinson and backed by Three Hills Capital, has appointed advisers as it explores ways to shore up its balance sheet. As first reported by Sky News, the 51-strong company, which completed a company voluntary arrangement in 2018, has appointed KPMG to explore options to access emergency funding. This is thought to include its ability to tap into the new funding schemes recently launched by the government to help cope with the coronavirus crisis. Wilkinson said: “In common with most businesses in the sector, we’re exploring the recently announced government support initiatives and have engaged KPMG to help with this.” Sky News said the company was understood to be keen to furlough the majority of its workforce by accessing the Coronavirus Job Retention Scheme, which has been set up to pay up to 80% of employees’ wages with a ceiling of £2,500 a month. However, because the company has a turnover of more than £45m but doesn’t have an investment-grade credit rating, it isn’t eligible for the £330bn Covid Corporate Finance Facility established to provide cheap loans.
