REG - Tasty PLC - Result of Sanction Hearing and Restructuring Plan

TastyAnnouncement

04/06/2024 16:00

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RNS Number : 0997R  Tasty PLC  04 June 2024

4 June 2024

Tasty plc

("Tasty", the "Company" or the "Group")

 

Result of Sanction Hearing and Final Restructuring Plan

 

Tasty (AIM: TAST), the owner and operator of restaurants in the casual dining
sector, is pleased to announce that the Restructuring Plan has been sanctioned
by the Court following the Sanction Hearing held today. Details of the
Restructuring Plan were announced by the Company on 9 April 2024.

 

The Restructuring Plan, alongside a number of additional measures to be
implemented across the Group, has restructured the Group to enable it to
return it to profitability and secure its long-term future, in order to
deliver the best outcome for stakeholders.

 

Prior to the sanctioning of the Restructuring Plan, the Group held 54 sites
comprised of 43 Wildwood, 6 dim-t branded sites, 2 non trading sites and 3
sub-let sites. The implementation of the Restructuring Plan has enabled the
Company to (i) compromise 23 leases (including 2 previously closed sites and 3
sub-let sites) and (ii) compromise the claims of a number of non-critical
unsecured trade creditors.

 

The Board expects the RP to enable a significant EBITDA improvement of up to
£2.1m between FY 2023 to FY 2025 through site rationalisations and other
tangible cost savings, including head office savings of £0.6m per annum and
expected lease savings from exited sites in FY 2024 of £2.1m. The Loan and RP
are expected to stabilise the Company in FY 2024 and ensure transformation to
meet new opportunities in the sector in FY 2025 beyond existing operations,
including exploring new audiences, new concepts and potential partnerships.

 

Following completion of the Loan Agreement announced on 9 April 2024 and
sanction of the RP, the Group is currently operating 38 restaurants with FY
2024 EBITDA expected to be £0.3m. Revenue of approximately £33.4m and cash
generation of approximately £1.3m is expected in FY 2025, with the loss in FY
2023 of £0.9m expecting to improve to a £1.2m profit in FY 2025.

 

Summary of Final Restructuring Plan

 

There were 7 classes of creditors with each class of creditors voting on the
Restructuring Plan as summarised below:

 

 Plan Creditor Class                      Voting Result
 Secured Creditor                         For
 Category B Landlords                     For
 Category C Landlords                     For
 Category A Rating - Authority Creditors  For
 Category B Rating - Authority Creditors  For
 Category C Rating - Authority Creditors  Abstention
 Non-Critical Creditors                   Abstention

 

 

 

As such, as 2 classes of creditors abstained from voting, and the Court was
asked to sanction the Restructuring Plan pursuant to section 901G of the
Companies Act 2006. TheCourt sanctioned the Restructuring Plan on 4 June 2024.
 

 

Plan Creditors will receive under the Restructuring Plan:

 

·    an estimated dividend of 4.17p/£ (such aggregate sum to be paid in
three equal tranches in August 2024, March 2025 and June 2025) from a
Compromised Creditors' Payment Fund (being a trust account for the benefit of
those Plan Creditors that have an allowed plan claim, established and funded
by the Company to the sum of £525,000); plus

 

·    payments from a Restructuring Surplus Fund, including 10% of the
amount by which the Group EBITDA increases from the sanction of the
Restructuring Plan to 31 December 2024 and a possible payment from the Upside
Fund if the Group exceeds its forecasted EBITDA from the sanction of the
Restructuring Plan to 31 December 2024, 50% of any increase over forecast will
be paid in March 2025.

 

In connection with the Restructuring Plan, the Board has committed not to pay
a dividend to Shareholders in 2024 or 2025.

 

Related Party Transaction

 

Certain of the lease liabilities compromised under the Restructuring Plan are
held by entities controlled by Samuel Kaye who, as a substantial shareholder
of the Company, is deemed to be a related party of the Company and such
arrangements constitute a related party transaction under the AIM Rules. The
Directors, having consulted with Cavendish, the Company's nominated adviser,
believe that the compromise arrangements involving entities held and
controlled by Samuel Kaye, are fair and reasonable insofar as Shareholders are
concerned.

 

FY 2023 Final Results

 

The Group's audit is progressing well and the Board currently expects to
announce FY 2023 results and publish its FY 2023 annual report and accounts in
June 2024.

 

This Announcement is released by Tasty plc and contains inside information for
the purposes of Article 7 of MAR, and is disclosed in accordance with the
Company's obligations under Article 17 of MAR.

 

For the purposes of MAR, Article 2 of Commission Implementing Regulation (EU)
2016/1055 and the UK version of such implementing regulation (as
amended), the person responsible for arranging for the release of this
Announcement on behalf of the Company is Jonny Plant, Chief Executive
Officer.

 

Enquiries:

 

 Tasty plc                          Tel: 020 7637 1166

 Jonny Plant, Chief Executive

 Cavendish Capital Markets Limited  Tel: 020 7220 0500

 Katy Birkin/George Lawson

 

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