Barkby losses to narrow slightly after pubs reopen

The AIM-traded firm said that, due to the impact of Covid-19 and its associated trading restrictions, it expected that would result in an EBITDA loss of £1.6m for the 12 months ended 30 June, before Cambridge Sleep Science startup costs of £0.9m.

That would result in a slight narrowing from its 2020 EBITDA loss of £1.7m.

Liquidity of £1.6m was available at year-end, with the board saying it was continuing to maintain the support of its major shareholders.

Operationally, the company reported a return to positive cash generation in Barkby Pubs in the final quarter, after the pubs were “materially impacted” by Covid-19 and national lockdown.

They had, however, traded ahead of expectations between 17 May and 30 June, after trading restrictions were eased in England.

Barkby acquired a six-year lease of the Ebrington Arms in the year, adding that trade post-period end in July had been “extremely strong”, with like-for-like sales up 97% on the same period last year, and up 10% on the equivalent period in 2019.

The company was “actively looking” for further opportunities to add to its growing pub portfolio.

In the commercial property division, enhanced planning permissions were granted in the year at Wellingborough and Saffron Walden, with a consequential uplift in value at Saffron Walden, which would flow through into the current financial year.

New planning permission was granted for a 32,000 square foot scheme at Huntingdon, and the company said it had exchanged a 15-year agreement to lease with Costa Coffee at its Maldon scheme.

A further five agreements to lease, across various sites, were currently in solicitor's hands.

Finally, in life sciences, Barkby said Verso Biosense gained Medicines and Healthcare products Regulatory Agency (MHRA) approval, and had started a clinical study with the University of Southampton in the period.

SleepHub was also successfully launched in Europe, Australia and the United States, with “strong demand” reported from suppliers.

“The group is now benefitting from the easing of Covid-19 restrictions and expects to return to profitability for the current financial year,” said executive chairman Charles Dickson.

“Since the easing of lockdown restrictions on 17 May, we have seen consistently strong trade across the pub business with the group benefitting from pent up demand and a UK staycation boom.”

Dickson said activity within the property development business had picked up “significantly”, with six agreements to lease exchanged or in legals.

“The group's investments in SleepHub and Verso Biosense continue to make positive progress and we expect to see these mature over the next 12 months.”

At 0932 BST, shares in Barkby Group were up 6.67% at 24p.