Fresh corporate documents have disclosed that Simmons owed millions of pounds in debts to OakNorth bank and tax authorities before entering administration.
The London-based cocktail bar chain has made at least 30 staff redundancies whilst shutting several venues as founder Nick Campbell fought to secure rescue funding to purchase the company through a pre-pack administration arrangement, as reported by .
Simmons owed £5.7m in outstanding loans to OakNorth, alongside £900,000 to tax authority HMRC and £850,000 to local councils Camden, Westminster, Hackney and the City of London.
The firm also owed £400,000 to drinks supplier Venus Wine & Spirit Merchants, according to filings by administrators Kroll.
The company has approached HMRC regarding a "time to pay" arrangement to defer settling some of its tax liabilities.
Campbell is set to acquire the group from administration in a £6m transaction, which encompasses settling the OakNorth debt by transferring it into a new facility.
"In recent years, the group has experienced a downturn in trading, largely attributable to a combination of macroeconomic factors," Kroll stated.
"The cashflow and profitability of the group has been significantly impacted by a continued challenging consumer environment post Covid-19, with consumers shifting away from drinking culture to more health-conscious lifestyles; increased inflationary pressures; and increased overhead costs."
Simmons did not respond to a request for comment. Campbell declined to comment on how the company would be financed, but told City AM that it was "incredibly disrespectful" to question employees about the business's status.
Hospitality under pressure
This development adds Simmons to an increasing list of hospitality groups that have either collapsed, entered administration or significantly scaled back operations due to escalating costs and reduced consumer demand. This includes steep increases in employers' National Insurance Contributions introduced in April, as well as diminished relief on business rates.
The British Beer and Pub Association (BBPA) has projected that this year, 378 pubs will shut down across England, Wales and Scotland – more than one per day on average – resulting in over 5,600 job losses.
Kate Nicholls, chair of º£½ÇÊÓƵ Hospitality, told City AM: "Sadly the news of further closures and business failures is all too common at the moment."
"Our last survey showed that half of London hospitality businesses are operating at or below break even – up from a third since the Budget. That's because the costs of doing business – rent, rates, employment – are much higher in the Capital but we have yet to see footfall and visitor numbers recover to pre Covid levels."
"Put simply the money coming through the front door is not enough to cover costs and as a result businesses are running out of road – they are being literally taxed out."
