Carluccio’s prepares to appoint administrators: Carluccio’s, the Mark Jones-led company, is preparing to appoint administrators next week after being forced to close its restaurants amid the pandemic. The company is working with FRP Advisory to handle the process. The company’s board has been working for the past week on a plan to mothball the business while retaining its 2,000 staff on 80% of pay and give it a “fighting chance of survival”. 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 was then 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.” Carluccio’s also declined to pay its quarterly rent bill this week. The prospect of finding a buyer for the business without an insolvency process during a period when the company isn’t generating revenue is remote. However, leisure analysts said given Carluccio’s was a prominent brand it was unlikely to disappear altogether. In 2018, it undertook a company voluntary arrangement, which resulted in the closure of about 35 restaurants. The company was founded in 1999 by the late chef Antonio Carluccio.

Young’s retains and continues to pay all staff with majority furloughed, board agrees 20% wage cut: London pub operator Young’s has retained all staff having furloughed the majority of workers and said everyone would continue to be paid. A total of 29 employees have been deemed as having essential roles and will carry on working from home while the group’s pubs are closed. Meanwhile, the board has agreed to a 20% cut in basic pay and hasn’t recommended a final dividend payment. The company stated: “Recognising that Young’s would be nothing without its people, the board has agreed the group will, on top of monies received from the government, fund the wages of all its furloughed workers whose annual salary was more than £30,000 so they will continue to receive 80% of their normal pay. These arrangements apply for April, are designed to protect jobs for the longer term, and will be reviewed again as necessary before the end of next month. The company has £235m of committed facilities from its banks and private placement lenders in place. The company’s net debt to Ebitda covenant is set at five times. All capex has been put on hold, resulting in a significant reduction in capex for FY2020/21. That, alongside not paying a final dividend for the year ended 30 March 2020, plus a £7m VAT deferral until March 2021 and a £14.5m business rates holiday, provides the group with further headroom to put it in a strong position to weather this crisis. In addition, the company remains in discussions with its banks, which are collectively very supportive, and is seeking to ensure additional covenant headroom. The board is also in the process of understanding whether it can access the Bank of England’s covid-19 Corporate Financing Facility. Taking all this into account, the board believes Young’s has sufficient headroom to deal with an extended period of closure.” Chief executive Patrick Dardis said: “In a business like Young’s, people are vital. I’m therefore pleased that, with support from the government, we are able to retain all of them and keep their pay at not less than 80% of what they would normally get. As I said previously, this crisis will be temporary. I’m therefore looking forward to all our team reuniting, opening the doors to our great pubs and welcoming back our customers once we’re through this. We remain confident in our strategy for the business.” The company will announce its preliminary results for the year ended 30 March 2020 on Thursday, 21 May.