Tasty PLC (AIM:TAST), the owner of the restaurant chains Dim T and Wildwoods, saw its shares fall more than 6% after its losses widened and it introduced a restructuring plan.
Post-tax losses rose from £6.4 million in 2022 to £14.5 million in 2023.
Under the plans, Tasty will close 19 loss-making stores, renegotiate seven existing leases and make redundancies.
Despite the turnaround plans, Tasty expects to face challenges from higher energy and labour costs, weak consumer spending and dampened sales because of the Euros, Olympics and general election.
“However, an uplift is expected towards the end of the year when a new Government will be in place and the Group will have a reached a period of stability post-restructuring,” chairman Keith Lassman said.
To support the restructuring efforts, Tasty secured an additional £750,000 in working capital through a loan agreement with a secured creditor.
Should restructuring go as planned, Tasty expects to benefit from a “significant improvement” in earnings over the next two years and hopes to find new opportunities and concepts in 2025.
Sales for the 2023 financial year increased by 6.5% to £46.9 million compared to £44.0 million in the previous year, while adjusted EBITDA rose to £4.4 million.