Gordon Ramsay’s restaurant empire has become the latest victim of a turbulent market, swinging to a multi-million pound loss last year.
The celebrity chef’s network of high-end restaurants, including City favourite Bread Street Kitchen and three Michelin-starred Restaurant Gordon Ramsay, reported a pre-tax loss of £3.8m in the year to August 2017.
The previous year Kavalake, a holding company for the eateries, made a profit before tax of just over £100,000.
Despite the deterioration in performance, the company insisted it was continuing to “actively look for new restaurant locations”.
One of Ramsay’s flagship restaurants, Chelsea hotspot Maze, is now set to close early next year and be replaced by a new concept, the group said in accounts filed to Companies House yesterday.
Overall turnover declined one per cent to £51.4m, but the company put this down to a five-month closure of its Heathrow Terminal 5 restaurant Plane Food during the period, and said that the site had been performing better than expected since reopening.
The group’s troubles come just a few months after Ramsay’s fellow celebrity chef Jamie Oliver was forced to close several Jamie’s Italian branches and put his steak house Barbecoa into administration.
The restaurant industry as a whole has been struggling with hefty rents, business rates rises and the higher cost of labour. This has pushed Prezzo and Byron to close sites, while the likes of Gaucho, Carluccio’s and Cote Brasserie are also thought to considering restructuring.
Just yesterday, research by leisure property specialists Cedar Dean Group showed that 84 per cent of London-based restaurateurs fear they could have to close or relocate sites in the capital.
Yet Ramsay’s empire reported that like-for-like earnings before interest tax, depreciation and amortisation (Ebitda), discounting the impact of Plane Food’s closure, rose 17 per cent, and pointed to its international operations as a bright spot in the business.
Kavalake is in the process of opening at least five new restaurants in China and the US, after a year in which overseas revenues jumped 52 per cent. A new concept called Hell’s Kitchen which opened in Las Vegas this year is said to be performing ahead of expectations.