Black Sheep Coffee converts £2m loan note into equity and raises additional financing as fy turnover more than doubles: Speciality coffee shop operator Black Sheep Coffee has converted a £2m loan note into equity and raised additional financing through equity issues after its turnover more than doubled in the year to 1 January 2023. Turnover rose from £10,709,936 to £21,348,236 during the period as the company made net 11 store openings. Of the 2022 figure, £21,337,672 came from the UK (2021: £10,706,338) and £10,564 from the rest of the world (2021: £3,598). A total of £20,870,557 came from operation of coffee shops including online sales (2021: £10,706,338) and £477,679 from franchise fees and recharges (2021: £3,598). But its pre-tax loss also more than doubled, from £2,835,195 in 2021 to £5,800,820 – which the company said was “anticipated at this stage of development” – as costs rocketed from £7,569,778 to £14,468,631. It received £155,338 in government grants compared to £1,333,230 in 2021 and the directors recommended no dividend be paid (2021: nil). The company said: “As set out in these financial statements, the group generated a loss after tax of £5,800,820 for the year ended 31 December 2022, and as at the balance sheet date, the group had net current liabilities of £8,575,781 and net assets of £3,705,857. Included in other creditors due within one year is a convertible loan note of £2,134,991 which was due for repayment on 30 September 2023. Subsequent to the year end, the loan was fully converted into equity in May 2023. The parent company and the group have continued to incur losses after year end as anticipated at this stage of development. Subsequent to the year end and prior to the approval of the financial statements, the company raised additional financing through equity issues. The group also has an ongoing business interruption insurance claim against Hiscox from the covid-19 pandemic that has not been factored into the cashflow forecasts. The group remains focused on growing sales by developing the product offering and customer service, enhancing the operating systems, growing the store network and developing its franchise business.” The share issues were as follows. On 23 January 2023, the parent company issued 3,957 A Ordinary shares at £0.01 each at £286 per share, which were paid before year end at a total of £1,131,702. On the same date, an additional 289 A Ordinary shares were issued at £0.01 each at £286 per share. On 17 April, the parent company issued 280 A Ordinary shares at £0.01 each at £286.00 per share, and on 5 May, it issued 41,210 Ordinary shares at £0.01 each at £69 per share. This occurred following the conversion of the convertible loan to ordinary share capital previously mentioned. AII existing shareholders were allowed to participate in the equity round at the share price from 2017, when the original loan was entered. On 17 May 2023, the parent company issued 41,648 A Ordinary shares at £0.01 each at £69 per share, followed by 261 A Ordinary shares at £0.01 each at £286 per share on 13 July and 38,534 A Ordinary shares at £0.01 each at £66 per share on 20 July. A further 619 A Ordinary shares at £0.01 each at £286 per share were issued on 1 September, and 525 A Ordinary shares at £0.01 each at £500 per share were approved in November but have not yet been issued. Further store openings post year-end means Black Sheep Coffee now has circa 76 in the UK and one in France. A strong new openings pipeline includes two in the US and four in the UAE as the company looks to expand its overseas presence. Black Sheep Coffee features in the Propel Turnover & Profits Blue Book. Its turnover of £21,348,236 for the year ending 1 January 2023 is the 371st highest in the database. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email kai.kirkman@propelinfo.com to upgrade your subscription.

Young people ‘increasingly turning their backs on alcohol’ as UK drinks 15% less than 15 years ago: Young people are increasingly turning their backs on alcohol – with two in five aged under-25 saying they are non-drinkers. Research shows the number of 18 to 24-year-olds who label themselves non-drinkers is up from 27% to 39% in just a year, reports The Daily Mail. By contrast, only 24% of over-55s say they do not drink, while overall, Britain is drinking 15% less than 15 years ago. And the young who drink are increasingly trying low- and no-alcohol alternatives, says Portman Group, an industry body which backs responsible drinking and organised the study. This total has risen from 31% to 44% in a year as the industry heavily markets zero alcohol options from famous brands. Many of these alternatives are about the same price as the original versions, despite the fact they do not carry any duty. Portman Group said the number of young adults calling themselves non-drinkers was 25% in 2020, rising to 30% in 2021, then 27% in 2022. It is now 39%. A spokesman said: “Trends show that the younger generation is now the most sober age group overall. Our research tells a positive story of how low- and no-alcohol products have become a normal part of how the public moderate drinking and tackle potentially harmful situations.”

Bedfordshire Domino’s franchisee in ‘strong’ financial position, reports record turnover of £28m but profit halves: AKM Group, a Domino’s franchisee based in Bedfordshire, has said it is in a “strong” financial position as it reported turnover increased to a record £28,062,018 for the year ending 31 March 2023 compared with £27,843,916 the previous year. Pre-tax profit halved to £1,800,000 from £3,611,412 the year before. In their report accompanying the accounts, the directors stated: “The financial position of the company remains strong and the company is well placed to take advantage of business opportunities as they arise. The directors look forward to the future with confidence.” The business did not receive any government grants (2022: £62,224). A dividend of £750,000 was paid (2022: £1,500,000).

Cornish holiday park sees turnover and profit fall as staycation ‘honeymoon’ period comes to end: The company behind Hendra holiday park, in Newquay, Cornwall, has reported turnover fell slightly to £9,707,869 for the year ending 31 March 2023 compared with £9,804,309 the previous year as the staycation “honeymoon” period came to an end. Prior to the covid pandemic, for the year ending 31 March 2019, the business turned over £7,038,382. Pre-tax profit was down to £2,020,749 from £3,789,179 the year before (2019: profit of £1,441,196). Occupancy rate was down to 74.1% from 81.5% the previous year. In their report accompanying the accounts, the directors stated: “The 2022 season promoted a return to near normal trading following the honeymoon period following covid.” The business did not receive any government grants (2021: £20,190). A dividend of £1m was paid (2021: £2m).

North London hotel operator falls to loss due to cost pressures as revenue remains below pre-covid levels: Beale’s Hotels, operator of the West Lodge Park hotel and The Bell in north London, has reported turnover increased to £4,310,985 for the year ending 31 March 2023 compared with £3,787,925 the year before. However, revenue remained below the £5,034,449 for the year ending 31 March 2019 – the last full year before the covid pandemic. The business made a pre-tax loss of £376,153 compared with a profit of £159,548 the year before. Occupancy was up to 73.30% from 67.40% the year before while revpar increased to £83.47 from £70.65. In his report accompanying the accounts, chairman Nicholas Beale stated: “The Bell generated £0.2m of sales on just over three months trading. Accommodation sales at West Lodge Park have been particularly strong, the result of a strong focus on sales, marketing and reservation refinements. However, set against high sales have been severe inflation in food and energy, increased costs as a result of taking on The Bell, and continued high pressure on salaries and wages. Finance and legal costs relating to company banking have further compounded these issues resulting in the net loss. While the headline figure is disappointing, the continued capital investment at both properties (including £1.3m at The Bell) will reap its rewards in the forthcoming year, the first full year of income from two properties since before the pandemic. In addition, some of the instability in the market (particularly in salaries and wages) is settling down. This forthcoming year will be a year of further refining our sales offer to ensure that we retain the quality of our offer to our customers, the quality of work and training for our staff, and overall a return to positive trading.” The company did not receive any government grants (2022: £182,299). No dividend was paid (2022: £137,855).