​Brighter Days Ahead for Prezzo

Prezzo's financial landscape is looking up after a pivotal year. In 2023, the restaurant chain achieved profitability, a testament to its extensive restructuring efforts. This turnaround followed a challenging period marked by the closure of 46 locations in response to unsustainable inflation impacts, as noted by CEO Dean Challenger. The move was crucial to Prezzo's survival, given its financial losses, escalating to a £31.5m pre-tax loss in 2022 from a £23.4m loss the previous year. These difficulties stemmed from surging food and energy prices.

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Despite these hurdles, Prezzo's strategic decisions paid off. The company saw its revenue climb from £95m to £135m, buoyed by menu price adjustments and cost-efficiency initiatives, which expanded the gross profit margin from 31.2% to 35%.With 97 operational sites, Prezzo is now positioned for "sustainable growth," according to Challenger.

Challenger remains optimistic about Prezzo's future, citing easing labour supply issues, stabilising inflation, a revitalised executive team, and securing utility costs for the coming years as key factors supporting the company's positive outlook.

Since its inception in 2000, Prezzo has expanded rapidly, becoming a staple in the UK's casual dining scene with 300 locations. However, the past six years have seen significant reductions in its footprint, including a CVA in 2018 that resulted in the closure of 94 sites and the shuttering of 22 more following its acquisition by Cain International in 2021.

Looking ahead, Prezzo is exploring new ventures, such as opening takeaway pasta shops in train stations, to adapt to the evolving market dynamics. Challenger acknowledges the brand's potential for growth, albeit with a pragmatic view of its scale relative to its past.

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