A Staffordshire-based restaurant group has reported rising turnover but a wider annual loss, citing inflation, higher staffing costs and investment in expansion.
Accounts for The Parogon Pub Group Limited show turnover increased to £26.7m for the 12 months to 29 June 2025, up from £24.1m the previous year. The growth was partly driven by the opening of two new sites in Telford and Mere Green under its Willow all-day dining brand.
However, the group recorded a loss after tax of £0.8m, compared with a £0.3m loss in 2024. Administrative expenses rose to £9.4m, up from £8.2m, linked to overheads, depreciation and investment in new sites, as well as higher employer National Insurance contributions and increases in the National Minimum Wage.
In the report, directors said trading had taken place ‘against a backdrop of persistent inflation forcing headline menu prices up and a subdued level of consumer confidence in the wider economy’.
The business was also affected by Storm Darragh, which hit during two key trading weekends in December, forcing the closure of multiple sites due to power loss and damage.
Despite the challenges, the company said its brand remained ‘resilient’, with customer feedback indicating diners still viewed visits as ‘very good value’.
The report stated: “Cost of goods inflationary pressures were very high through the year impacting gross profit. Strong procurement and menu development processes helped mitigate material parts of these but inevitably much of the cost increases had to be passed on to guests.
“Thankfully the brand strength and loyalty Parogon holds proved resilient and feedback mechanisms indicated consumers still rated their experiences as very good value.”
The group’s gross profit rose to £9.5m from £8.6m, while earnings before interest, taxes, depreciation, and amortization (EBITDA) fell from £1.5m to £1.3m. Net assets stood at £0.5m at the balance sheet date, down from £1.6m, reflecting increased borrowing to fund expansion.
During the year, the company refinanced its debt facility, securing £9.6m which was used to refurbish the two Willow sites and acquire the freehold of The Wayfarer, in Stone, for £2.1m. Directors described the purchase as ‘value enhancing for the Group’.
The Orange Tree Bar and Grill in Trent Vale, Stoke-on-Trent, – which was the Group’s third site to be opened in 2013 – was fully refurbished during the period at a cost of £350k, recording ‘double-digit sales growth’ since reopening.
Looking ahead, the company, which achieved B Corp status in June 2024, said it had seen ‘very strong demand during peak periods’, despite ongoing pressures from the cost-of-living crisis, inflation and interest rates.
It added: “The Board of Directors are confident that the Group will report a year of strong profitability in the next period and continue to look to expand the business.”
The group, which began in 2007 with The Swan with Two Necks in Blackbrook, now operates 12 sites and plans further expansion across Shropshire, Cheshire and surrounding counties, alongside continued rollout of its Willow brand.
