Prezzo plans to open more outlets

Restaurant chain Prezzo plans to open another 25 outlets this year after smashing City forecasts for profits in 2012 despite the austere consumer climate.

The pizza and pasta chain opened 31 new restaurants during 2012 as it grew revenues by 17% to £144.5 million.

Adjusted profits of £18.3 million were 5% ahead of analysts' forecasts and 11% better than a year earlier, even though the period was impacted by summer distractions such as the Olympics, Euro 2012 and Royal Jubilee.%VIRTUAL-SkimlinksPromo%
Its expansion plans will add about 375 more staff to its total workforce of around 3,000.
Chief executive and co-founder Jonathan Kaye said a combination of opening in good locations, training, marketing and its food offer drove the out-performance.

Chairman Michael Carlton added: "This is the fifth consecutive year that we have entered without a clear conviction that the UK economy can deliver sustained growth on any meaningful scale over the next 12 months. However, Prezzo has prospered during this period of uncertainty and we will continue to drive the business forward."

Prezzo halted expansion in 2009 as the downturn squeezed consumer spending and profits. But new openings in 2012, plus a couple of closures, gave the company 210 outlets by the end of December.

New sites for the Italian-style Prezzo brand included prime spots in London such as the newly-overhauled Kings Cross station, as well as restaurants in Manchester, Bristol, Bath, Beaconsfield, Marlow, Southport and Chingford. It also recently opened a Prezzo in Belfast, its first in Northern Ireland.

Prezzo also counted more success with its Chimichanga Tex-Mex chain, which sells food including fajita wraps, tortilla burgers and enchiladas. Its "increasing confidence" in the brand prompted 13 new openings, including in Bournemouth, Bury St Edmunds, Bromley and Ealing, to give it 28 sites.

Mr Kaye said trading is "going well so far this year", but declined to give more detail on underlying sales growth. He said: "I remain confident in being able to adapt to what the economy throws at us."

High Street casualties
See Gallery
Prezzo plans to open more outlets

Administrators sounded the death knell for Woolworths in December 2008, leading to store closures that left 27,000 people out of work. Since its collapse former Woolworths stores have become a blight in many town centres and more than 100 of the large stores still lay vacant in January 2012.

Loyal customers didn't have go without the family favourite store for long however as it reappeared online as in 2009, after Shop Direct Home Shopping bought out the Woolworths name.

The greetings cards specialist became the latest highstreet casualty in May with 8,000 jobs on the line when it was forced it into administration. Its biggest supplier, American Greetings, then bought Clintons out of administration and put the retailer through a rebrand including a new logo and complete in-store revamps.

Its contemporary format includes new fixtures and fittings and easier to navigate stores, and will be rolled out to all 400 UK stores at the cost of £16million. Bosses aim to bring the brand back to profit within two years.

Poor sales in the run up to Christmas was the final nail in the coffin for several struggling chains, including lingerie retailer La Senza, which went bust in January 2012 with 146 shops and 2,600 staff. Kuwaiti retailer Alshaya bought part of the business, which saved 60 shops and 1,000 staff.

La Senza has been struggling in a similar way to other specialist shops such as Game and Mothercare, which have been hit by cut-price competition at supermarkets and have no alternative products to help shoulder losses.

Stricken retailer Blacks Leisure, which employed 3,600 staff across 98 Blacks stores and 208 Millets stores, went into administration in Janurary 2012 after failing to find an outright buyer.

Soon after its stores were bought by sportswear firm JD Sports in pre-pack deal - an insolvency procedure which sees a company being sold immediately after it has entered administration – which saw most of Blacks' £36 million of debt wiped out.

Fashion chain Bonmarche, which was part of the Peacock Group, was sold in January when the group collapsed due to unsustainable debts, resulting in 1,400 job losses and 160 store closures. Private equity firm Sun European Partners bought 230 stores, which continue to trade with 2,400 staff.

Peacocks collapsed under a £740 million net debt mountain in January 2012 in the biggest retail failure since Woolworths. Despite being sold out of administration to Edinburgh Woollen Mill in a deal that saved 380 stores and 6,000 jobs, administrators from KPMG were forced to close 224 stores with immediate effect. This lead to 3,350 redundancies from stores and Peacocks head office in Cardiff.

The high street name continues trading as bosses work to stabilise the situation, yet a further blow was dealt this month with news that the firm's pension fund is in £15.8 million shortfall as a result of the collapse.

Game buckled under its £85m debt pile in March 2012 and was placed into administration after being unable to pay a £21m rent bill. Administrator PwC immediately closed 277 shops, with the loss of 2,000 jobs. Soon after, investment firm, OpCapita bought 333 Game stores, saving more than 3,000 jobs.

Game's demise followed a string of profit warnings and the failure of nervous suppliers, including leading names Electronic Arts and Nintendo, to go on providing the latest games, further damaging poor sales.

Read Full Story