Wednesday, 22 May 2019

Revealed: Jamie Oliver's restaurant empire lost £29m in one year - £5m more than it made in a DECADE - as experts say it was 'NEVER a successful business' and TV chef 'should have hit the panic alarm five years ago'

Jamie Oliver's restaurant empire was never financially successful and 'should have hit the panic alarm years ago', a high street expert has said, after figures analysed by MailOnline reveal the firm lost more in a single year than it ever made.
The £29million loss in 2017 comes to light as it emerged banks and suppliers could pursue the wealthy celebrity chef personally, for debts built up by his now-defunct chain.
The chef announced yesterday the struggling eateries would close, with 1,300 workers set to lose their jobs.
The decision to put the business into administration triggered the closure of 22 restaurants, including 20 branches of Jamie's Italian.
The latest accounts for the celebrity chef's main restaurant business, Jamie’s Italian Limited, show the company made a loss of more than £29million on a turnover of £100million in 2017.
But in all its seven years in the black (2009 to 2015) the firm netted only £24million.
In fact, despite turning over more than three quarters of a billion pounds between 2008 and 2017, Jamie's Italian made a net loss of £15million over the period. 
The Italian chain eeked out profits in single-figure millions despite massive expansion and turnover over £100m a year - before takings took a nosedive and massive losses began
The Italian chain eeked out profits in single-figure millions despite massive expansion and turnover over £100m a year - before takings took a nosedive and massive losses began
Jamie's Italian Limited: How TV chef's massive turnover never led to big profits
Financial Year Turnover   Profit / Loss
2008 £3,737,482  - £696,252 
2009 £19,415,562  £1,177,390 
2010£47,618,140 £2,996,752
2011£72,022,225 £5,646,433
2012£93,869,992 £5,882,590
2013£101,814,477 £4,242,921
2014£106,861,926 £2,678,884
2015£116,107,665 £1,588,383
2016£112,718,162 -£9,423,334
2017£100,557,128 -£29,257,472
2009-2017 £ 774,722,759 -£15,163,705 
Mr Oliver's Fifteen restaurant in Hoxton was administered by a different firm in the group, Fifteen Restaurant Ltd. That not-for-profit turned over between £2.5m and £5m a year over the period making an operating profit in the tens of thousands in most years, and in three years posting a loss.
The extraordinary financial figures call into question whether the massive business - which in 2018 was reported to have debts in excess of £70million -  was ever truly viable or was always destined to fail.
Professor Joshua Bamfield, director of the Centre for Retail Research, told MailOnline:‘There’s no evidence it was ever a successful business. On the basis of these figures they should have been hitting the panic alarm four to five years ago.’
He added: ‘It looks like reckless expansion – from the time they hit £100m, profits are threadbare and then they’re negative. Really there’s no justification for the continued expansion after 2014.’
He said the expansion would have been intended to provide the company economies of scale and market share, but that key competitors including Carluccio’s and Prezzo were doing the same thing at the same time, adding: ‘It’s one thing having a strategy, but when it’s obviously not working you ought to change it.'
It emerged today Mr Oliver could personally be pursued by banks and suppliers for millions of pounds in debt following the collapse of his restaurant empire.

It is understood Oliver provided personal guarantees to the bank and food supplier Brakes, allowing them to pursue him over unpaid bills, according to the Telegraph.
A spokesman for Jamie Oliver declined to comment to MailOnline when asked about the personal guarantees given to HSBC and Brakes. 
The 43-year-old, who has netted £240 million during 20 years in the public eye, said he was 'devastated' and 'deeply saddened' following yesterday's announcement
He thanked staff and suppliers, adding: 'I appreciate how difficult this is for everyone affected. It's been a real pleasure serving you.' 

Staff at Oliver's flagship restaurant in Birmingham claim they were sacked by email just 30 minutes before the company announced it had collapsed.
One worker said: 'I'm really angry because Jamie won't be the one looking for a job and struggling to pay his bills, it'll be poor saps like us who worked for him.'
 Major trouble for the empire first surfaced in 2017, when Oliver, whose is said to be worth around £150million, injected £12.7million of his own money into the business.
The firm also took out £37million in loans from HSBC and other companies as the empire struggled with debts of £71.5million and teetered on the edge of bankruptcy.
 Experts say the growth of takeaway apps, and a 'saturation' of food chains on Britain's high streets contributed to eroding the company's earnings.
The crumbling chain was also beset by a tide of poor reviews, including critic Marina O'Loughlin who in 2018 said she would have to be 'paid to go back'.

Timeline: How Jamie Oliver's chains plunged into debt

2008: Jamie's Italian opened its first restaurant in 2008.
2015: Jamie At Home, which contracted agents to sell his cookware range at parties, ceased trading after racking up losses. The company began in 2009, as part of the Jamie Oliver organisation, before being licensed to another firm in 2013, but shut up shop in 2015.
2017: Jamie's businesses lost £20m, forcing him to shut 18 of his Italian restaurants - leading to the loss of 600 jobs.
Chain was struggling with debts of £71.5m and teetered on the edge of bankruptcy before the chef injected his savings into the business. 
The firm also took out £37m in loans from HSBC and other companies. 
In 2017 he closed the last of his four his Union Jack Piazzas, in London's Covent Garden. 
2018: Jamie's Italian shuttered 12 of its 37 sites, with the latter tranche executed through a Company Voluntary Arrangement (CVA).
He also came under fire for failing to pay suppliers after his upmarket steak restaurant Barbecoa crashed into administration, leading to the closure of its Piccadilly branch.  
The restaurant in St Paul's continued to trade and was bought out by a new company set up by Oliver, who was no longer legally liable for the debts. 
2019: All but three of Jamie Oliver's restaurants close after the business called in administrators, with 1,000 staff facing redundancy. 

The chef himself previously blamed his empire's parlous state on Brexit, as well as rental costs, local government rates and the increase in the minimum wage. 
According to Companies House, his umbrella company Jamie Oliver Holdings Ltd turned over £32 million last year, a staggering £87,670 a day.
But Jamie's Italian was on the brink of collapse two years ago with the chef revealing in an interview it had 'simply run out of cash' and run up millions in debt.
In February last year he closed 12 restaurants and put his company into a company voluntary arrangement, which is one step from insolvency.
Court documents revealed that at that point the group owed £41.5million to a huge number of creditors.
Despite his financial woes, Jamie recently splashed out £6 million on a 16th century Essex mansion, in a 70-acre estate, complete with ghost.
He's reportedly planning to convert outhouses into a mega-kitchen from which he can film shows and hold his masterclasses.
He and Jools spent £8.9 million on a Grade II-listed mansion near Hampstead Heath, north London, in 2016, and spent two years renovating it.
It boasted seven bedrooms, an open-plan kitchen with cream Aga, a grand piano and a Louis XV-style bed worth £2,200, it's certainly impressive.
The Olivers have fitted the house with some quirky features, including a wood-fired pizza oven, a treehouse bed and a vegetable patch for the children.
Jamie hired his brother-in-law, Paul Hunt, married to his sister Anna-Marie, to run Jamie Oliver Ltd in 2014 — and last year Hunt assumed responsibility for the restaurants, too.
But some of his methods — such as making staff redundant over Christmas and cutting ties with Jamie's friends and culinary mentors — have led to a reputation for ruthlessness.
Last year, an anonymous insider described him as an 'arrogant, incompetent failure' who was 'running the business into the ground'.
Jamie rebutted the claims, saying the story was 'nonsense' and that Paul was 'a loyal brother-in-law and loving father as well as a strong and capable CEO'.
Yesterday KPMG announced that the Jamie Oliver Restaurant Group Ltd and four subsidiaries – Jamie’s Italian, Jamie’s Italian Holdings, One New Change, and Fifteen Restaurant Ltd – had gone into administration.
Of those firms, only Jamie’s Italian and Fifteen Restaurant are longstanding companies with accounts filed at Companies House. Jamie's Italian Limited is by far the larger of the two, running most of the sites. 
Fifteen Restaurant Ltd, a not-for-profit which runs Jamie’s flagship restaurant in Hoxton, was only profitable in one year of the period, despite turning over up to £4.8m a year.

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