Decision to cap prices pushes Nisha Katona’s Mowgli into the red

The TV chef Nisha Katona’s curry chain Mowgli Street Food has fallen into the red after opting to keep a lid on its prices in the face of rocketing food inflation.

Pre-tax profits of £1.9 million in 2022 cooled to a loss of £476,000 on sales of £30.9 million, up 15 per cent, in the year to July 2023, according to the company’s latest accounts.

After stripping out a £907,000 write-down on restaurants fitted out before the pandemic but then mothballed, as well as other pre-opening and management expenses, the private-equity backed business made a £3.8 million profit before interest, tax and other accounting items.

Katona, 52, a former child protection barrister who is a judge on the BBC’s Great British Menu and resident chef on ITV’s This Morning, admitted the company had been through a “tough time” in the last 18 months “navigating cost pressures”. The chain has 21 restaurants across the UK.

“Restaurants that are doing particularly well are the ones that are still affordable and for Mowgli, my view is that you’re no good to anyone if a couple of teenagers can’t come out and dine with their pocket money. Those diners are our future,” she said.

“Keeping prices low is one of the greatest and most important challenges over the next year. However the outlook is positive as it feels like we are past the period of high inflation.”

Katona opened her first Mowgli in Liverpool in 2014 and sold a majority stake to private equity firm TriSpan in January 2023, in a deal thought to value the firm at £25 million to £30 million.

She has plans for seven new restaurants this year and has identified more sites for 2025, including her first overseas site. “I’m beginning to think about taking Mowgli to Dublin and potentially Jersey, and this is the start of a potential international journey for my Liverpool-built family business,” she said.

“My feeling is that people understand that eating out is almost a necessity, not a discretionary spend and therein lies the hope that there will be the growing buzz of community life and the heart warming twinkle of hospitality on our high streets for a long time to come.”

She added that her restaurants were recording “customers eating out in record numbers particularly over the weekend, spending more than they ever have Thursday to Sunday. Early week trade is down, but it is compensated for by the different pattern of dining.”