Jools Oliver, wife of the celebrity chef Jamie Oliver, set social media abuzz in December when she posted pictures on the couples 9million dollar house. The seven-bedroom, Grade II-listed property in London’s rarefied Hampstead was as sumptuous as might be expected for a chef who has built a £150m fortune from a business spanning books, TV, endorsements and restaurants.
But as Jools’s followers admired the fruits of Oliver’s success, he was battling to save Jamie’s Italian, the centrepiece of his restaurant division. In December, Oliver pumped £3m of his own money into the business, and in January the chain said it would close 12 of its 37 locations, as part of a rescue deal with its creditors to keep trading.
Last week, court documents emerged showing Jamie’s Italian had debts of £71.5m. This comprised £30.2m of overdrafts and loans, and £41.3m owed to HMRC, landlords, suppliers and other creditors. Staff were owed £2.2m.
Oliver’s spokeswoman says the £71.5m figure paints a distorted picture – £47m is covered by loans from HSBC and Jamie Oliver companies. She adds that money owed to suppliers, the taxman and employees is standard for a business and, she says, everyone has been paid. But the documents show the business was on the verge of going bust.
So where did it all go wrong? Warning signals emerged in early 2017, when Jamie’s Italian blamed intense competition and rising costs, partly as a result of Brexit, for the closure of six branches. When accounts for 2016 were published in October, the business had slumped to a £9.9m pre-tax loss from a profit of £2.4m a year earlier. The loss was caused mainly by the costs of branch closures and handing back a lease for a site in King’s Cross where Oliver had scrapped plans for a giant restaurant, pub and head office complex.
The accounts said the chain’s remaining branches were outperforming the market and that the brand “remains incredibly strong”. A cut-price lunch offer had brought in more customers and the business was set to increase earnings “long into the future”.
But the restaurant business’s chief executive, Simon Blagden, left in October along with the finance director, Tara O’Neill. Jon Knight, who ran the international arm of Jamie’s Italian, took over the UK operation and the business was brought under the wing of Paul Hunt, the husband of Oliver’s sister Anna-Marie.
Hunt, a former City trader who was fined £60,000 in 1999 for insider trading, had overhauled Oliver’s media and licensing operations after taking charge in 2014. Oliver is now said to be more involved with the restaurant business, having left it to others in recent years.
Peter Martin, vice-president at the food and drink consultancy CGA, says savvy operators such as Nando’s and JD Wetherspoon have remained successful by adapting to changing tastes. The court documents for Jamie’s Italian paint a picture of under-investment, complex menus and ill-judged branch openings.
Yet away from his restaurants, Oliver’s business continues to make plenty of money. At Jamie Oliver Licensing, which covers his endorsements and range of products and tie-ups, pre-tax profit rose to £7.3m from £7m in 2016. Profit at Jamie Oliver Holdings, which covers his media interests, rose to £5.4m from £1m. Oliver paid himself £10m in dividends for the year – £6m from licensing and £4m from media. He has never taken any money from the restaurant business.