7Bone Southampton saved from administration after hitting £1m debts

7Bone faced a "cash crisis" this summer, caused in part by the blaze that destroyed its profitable Portswood branch. Around 75 firefighters tackled the fire.

Hot weather and "general headwinds" facing the sector also hit the business.

The company entered insolvency on November 3 with 183 staff on the books – having accrued debts of more than £1m.

But it was saved when co-founder Matt Mollicone appointed administrators to complete the sale of the business and the majority of its assets transferred to one of his holding companies.

Known for its ‘dirty’ burger menu, 7Bone first opened in Southampton in 2013, before setting up the Bournemouth site two years later. The business then received significant investment in 2016 and rapidly expanded, growing from four sites to 13 by 2022.

7Bone Burger Co in Bournemouth (Image: Newsquest)

In June, the Portswood site was destroyed in a fire. Administrator Interpath said this was a significant blow to the business.

The brand also closed two of its restaurants earlier this year in Eastbourne and Maidstone, citing industry challenges.

In its report, Interpath said: “During the summer of 2022 [7Bone] began to experience significant cash flow pressures.

"This was due to a number of reasons including, but not limited to, the forced closures of the group’s profitable Southampton site in July due to a fire, the unusually hot summer of 2022 which resulted in weaker than forecast trading, and the general headwinds facing the hospitality sector.”

Interpath's report also said newer 7Bone restaurants were not performing as well as established sites such as Bournemouth. Staffing issues following the Covid pandemic and insufficient cash to invest in marketing were also reasons cited for the financial issues.

Fire at 7Bone, Southampton, in July 2022 (Image: Newsquest)

At the date of the administrator’s appointment, the company had just £94,000 in the bank and owed about £1.1million to HMRC.

The report also stated it was “highly unlikely” HMRC would receive any of the £1.1m owed.

It said: “The company’s secondary preferential claims (HMRC) – based on current estimates, it is highly unlikely there will be sufficient funds available to enable a dividend to secondary preferential creditors.”

However, following the business’ transfer to Mr Mollicone’s Bones Restaurant Group Ltd, all 183 employees of the company will remain in employment.

In November 7Bone said it could be looking for a new site to replace Portswood as rebuilding work was progressing slowly.