CVAs increase by 200% in quarter 3 for restaurant and food services industry
Research by Linklaters has shown that the number of CVAs in the restaurant and food services industry for quarter 3 of this year are up by 200% compared with the same period in 2017.
This news follows the recent headlines surrounding Gourmet Burger Kitchen who have begun restructuring talks. While there has been a significant rise in the food and dining sector, there has been only a 15% change across other industries. The most significant rise has been in the last 9 months when CVAs shot up by 157%.
Linklaters partner, Richard Hodgson explains: “The UK’s casual dining sector is facing its most challenging trading period to date, with many business owners taking tough action. We’ve seen several chains closing outlets using the CVA process this year as a result of saturated levels of competition, a slow-down in consumer spending and seemingly ever increasing costs, including on business rates.”
- In the Restaurants and mobile food service activities subsector, CVAs filed in the last 9 months (Q1-Q3 2018) were up 260% on the same period in 2017. This is compared with a 15% change across all sectors. This would include businesses like Gourmet Burger Kitchen who have recently begun restructuring talks with creditors.
- There was a 200% increase in Restaurants and mobiles food service activities CVAs in Q3 2018 compared to Q3 2017, and a 20% increase compared to Q2 2018.
- There was also a significant change in the last 9 months (Q1-Q3 2018) compared to the previous nine months (Q2-Q4 2017) of 157%.