“Better” burger chain Byron Burger’s turbulent recent history has been shaken up further by the COVID-19 pandemic’s impact on U.K. restaurants. Propel’s newsletter reports that it has appointed finance firm KPMG to auction off the business, which has 51 restaurants and 1,200 employees across the U.K. All of the restaurants are currently closed, with workers on “minimum-hour payment terms,” according to Sky News.
“Covid-19 hit at a frustrating time for Byron,” a source is quoted as saying, pointing to a remarkable turnaround in the brand’s financial results, which are not yet publicly available. “For the 2019 financial year, Byron delivered turnover of £70.9 million, with a gross profit of £31.6 million and a gross margin of 44.4 percent,” they claim. In the 2018 financial year, Byron made a loss of over £42 million.
Those results suggest that its measures to improve the restaurants, from slashing rents to the planned refurbishing of its entire estate, had been a success, which partly explains the “frustrating” timing. The move to an auction, rather than a traditional sale, is symptomatic of the pessimism around one of the sectors worst-hit by the novel coronavirus, with KPMG reportedly able to take whatever measures it deems suitable to secure its future. This could include refinancing, under current owners Three Hills Capital Partners, who acquired the brand in 2018.
Byron has spent the last nine months reimagining its restaurants, menu, and logo in a bid to resurrect its fortunes, which plummeted in the midst of the “casual dining crunch” in 2018. It had already lost swathes of the public by organising a fake staff meeting in order to turn undocumented workers over to the Home Office, which was at the time working under Theresa May’s “hostile environment.”
Before total reimagination, came a series of errors: the strange “Classic flex” burger, a patty made from 70 percent beef, 30 percent mushrooms, proving a flop. Those misfires prompted a £10 million investment and the hiring of prominent chef Sophie Michell to oversee the new menus. But with the current owners looking to exit just as the turnaround begins, it will be interesting to see who might come in for a troubled brand at a troubling time for the restaurant industry.
- Auction for Byron to start this week [Propel]
- Coronavirus: Byron Owners Launch Bid to Flip Burger Chain [Sky News]
- Food Service Industries Furlough Highest Proportion of Workers During Coronavirus [ELDN]
- Byron Burger’s Next Great Hope Is Brunch [ELDN]
- Struggling Burger Chain Byron Has Quietly Closed 16 Restaurants [ELDN]
- Is Byron Burger on the Verge of a Comeback? [ELDN]