Business

Di Maggio’s, Café Andaluz and Amarone restaurants owner sees profits fall sharply

Business Editor

PROFITS at the restaurant group behind the Di Maggio’s, Café Andaluz and Amarone brands fell sharply in the year to April 2021 as coronavirus-related restrictions took their toll, the owners have revealed.

However, The DRG, which describes itself as Scotland’s largest independent restaurant group, yesterday declared itself “better placed than most”. And it flagged its expectation that profits would rise in the current financial year.

Founding director and co-owner Mario Gizzi said pre-tax profits had fallen to around £500,000 in the year to last April, from £2.6m in the prior 12 months.

Turnover fell to £11.5m in the 12 months to April 2021, from around £32.5m in the previous financial year.

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Mr Gizzi, who owns the business with fellow director Tony Conetta, said: “In the circumstances, these results show the resilience of the business, especially when you consider that we endured lockdown after lockdown and that the industry as a whole has been badly damaged.

“It is no secret that operators are facing hugely challenging times in the year ahead, and we are no different. However, relatively speaking, we are better placed than most to come out of the pandemic intact.”

A spokesman for The DRG said the group expected pre-tax profits in the current financial year would be higher than those in the 12 months to April 2021 because the restaurants had been able to trade for more weeks in the latest period and as a result of the temporary reduction in value-added tax for the sector.

The DRG opened its first restaurant in England, a Café Andaluz outlet in Newcastle, in October last year.

It said this restaurant had “performed well in the circumstances of Covid”.

The spokesman said dividends paid to Mr Gizzi and Mr Conetta for the year to April 2021 totalled around £1m, up from about £900,000 for the prior financial year.

However, he emphasised the directors had invested a further £2.9m to support the business in the year to April 2021, including in the refurbishment of the Barolo restaurant in Glasgow and the Amarone eaterie in Edinburgh.

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The DRG employs about 1,000 people across its 21-strong portfolio, which includes four Di Maggio’s, six Café Andaluz, and three Amarone restaurants. The group also takes in The Anchor Line, Atlantic Brasserie, Citizen Bar & Dining Rooms and Barolo restaurant in Glasgow. It also includes the Cadiz seafood restaurant in Edinburgh, and three food court operations.

The Di Maggio’s restaurant in Shawlands on Glasgow’s south side, which marked the group’s debut when it was launched in 1985, has been open for takeaway only in recent times because of social distancing restrictions that were in place. And the Di Maggio’s Theatreland restaurant in Glasgow has not been open.

The spokesman noted the group planned to open these restaurants as normal in due course.

He confirmed that all of the other restaurants in the group were open as usual.

Mr Gizzi described the UK Government’s furlough scheme and business loans as “vital lifelines for the hospitality industry”.

He added: “Without them, our sector faced being essentially wiped out.”

The DRG said: “The group’s larger restaurants in Glasgow, Edinburgh and Aberdeen, which were still able to operate during Covid restrictions given their ability to space out tables, as well as city centre locations which were able to use pavement terraces, helped the group to continue to generate much-needed income.”

The spokesman noted that, during lockdown, all of the restaurant employees and most of the head office workers had been furloughed, and the company had operated with only a “skeleton staff”.

Mr Conetta said: “Everyone is just hoping that the restrictions can be eased completely and that our diners and staff can get back to some form of normality.

“Thankfully, the Omicron variant has not had the same devastating health consequences as the first waves and we are all just awaiting the day when the Scottish Government lifts the remaining restrictions.”

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