How our partnership began
Credo Partners invested in Villa Paradiso in October 2017. Since then, the company has grown from two to six restaurants and become founder-independent. We restructured the group functions (several times), secured financing to survive COVID-19, refreshed and structured its brand, rehired and retrained almost the entire service staff post-pandemic while keeping the restaurant guests and the bank happy and establishing an ESG game plan.
The COVID-19 years were extremely challenging for any restaurant business, with revenues suddenly dropping by as much as 75% over longer periods. The group has been in survival mode for quite some time, and we are happy to enter 2023 with a refreshed balance sheet and operational team to drive performance and profitability towards a successful exit.
Recent results
Villa Paradiso navigated a challenging 2023, achieving positive growth in revenues and EBITDA despite setbacks, including the closure of an unprofitable restaurant in Fredrikstad. Adjusted EBITDA improved to 5%, up from 3.5% in 2022, indicating progress but highlighting that there’s still work to do to reach long-term goals.
The broader restaurant market also struggled, with full-service establishments in Oslo seeing declines of up to 16%. Villa Paradiso responded with significant operational changes, including a restructure of its group management and integration with Concept Restaurants, known for managing Delicatessen. This strategic shift is expected to deliver cost savings and margin improvements.
How we see the future
Villa Paradiso started 2024 with a more streamlined structure. Villa Import, after a successful downsizing in early 2023, now operates independently with stable EBITDA margins of 6-7%. The ongoing restructuring is aimed at positioning Villa Paradiso and Villa Import as attractive acquisition targets, with distinct management teams and simplified operations.
At the time of writing, we have the first quarter of 2024 behind us with a lot of positive changes implemented: Renegotiated supplier contracts, upgraded booking systems, and a strengthened financial position through reduced bank debt and new equity from shareholders. Moving forward, sustainability remains a focus, with efforts to reduce waste, increase vegetarian options, and improve employee retention to enhance service quality.
