The Savor Group has reported outstanding results in its 2023 financial annual report despite inflation, the shortage of workers, and rising salary and wage costs. With a total annual revenue of $52.4m, this was a 70 percent increase from the previous year.
Operating earnings for the year were $5.2m, and the company's cash flow exceeded $6m, a significant increase from $2.9m in 2022.
Savor Group's balance sheet also improved. It repaid over $3.6m of principal debt and the $2.85m deferred consideration for acquiring Amano and the HIP Group.
The Executive Team is proud of Savor Group's progress over the last five years and believes these achievements will increase stock liquidity and share price growth.
The first quarter of the Financial Year 2023 was slower than anticipated due to the omicron restrictions, which continued to affect the business in April and May 2022. The slow return of corporate workers to the Auckland CBD, staff wage pressures, and increased input costs added to the crisis and the group had to increase menu prices mid-year to protect margins ahead of summer.
Savor took a proactive approach to addressing these staffing issues, which have affected restaurant revenue since 2021. It used offshore hospitality consultancies and leveraged existing international staff to refer experienced workers.
Working with the Ministry of Immigration, the group secured a pipeline of international workers from early September 2022, allowing Savor's venues to re-establish pre-COVID trading hours. This recruitment came at a cost, but it had paid off, with all venues at total trading capacity and new openings of OJI Sushi and The Store at Auckland Fish Market.
During the weather calamities of early 2023, Savor's venues suffered no significant damage, except its goods distribution centre at Waimauku, which was impacted by a prolonged power outage, resulting in the loss of perishable goods.
March '23 brought revenue of $6.4m, with an influx of corporate workers and university students returning to Auckland's centre, and FY'24 will implement a four-pillar strategy that involves maintaining revenue momentum, prioritising free cashflows, driving operating earnings, and reducing debt.
The 2023 financial year also benefited from the opening of MoVida and Bivacco towards the end of 2022, both of which received critical acclaim.
At the Annual Meeting in August 2022, the group had expected these two venues to represent around $20m of annualised revenue.
Coping with and divesting the underperforming Moa business while navigating the challenging Auckland business environment over COVID may have slowed the group's delivery but hasn't altered its progress.
Savor's portfolio comprises Amano, Amano Bakery, Azabu Mission Bay, Azabu Ponsonby, Bang Bang, Bar Non-Solo, Bivacco, Ebisu, Lobster & Tap, Market Gallery, MoVida, Non-Solo Pizza, Ortolana, The Store, and The Wreck.
