The Issa brothers blame working from home for fast food chain Leon's growing losses.

The Issa brothers spent much of 2023 selling off assets to reduce borrowing as interest rates rose. Photo: John Super/Alamy Stock Photo

Sales at Leon's restaurants rose by £29.1m to £82.6m in 2022, new accounts show, but losses widened from £7.5m to £12.6m .

Revenue was more than £30 million lower than in 2019, when the chain hit £115 million in turnover.

Leon is not the only fast food chain to suffer from the growth of hybrid jobs. As a competitor, Itsu was forced to move some restaurants in central London to three-day opening hours.

Julian Metcalfe, chief executive of Itsu, said earlier this year that Itsu's “traditional hubs” – central London and the West End – have been “fundamentally changed” by working from home.

Pret A Manger was also forced to shift its focus from downtown sandwich shops to suburban stores.

Mr Issa added that Leon had to contend with the fallout from the British railways strike, which had “an even greater impact on business given the location of many of Leon's restaurants close to transport hubs.”

Trade association UK Hospitality estimates that rail strikes have cost the UK's pubs, bars and restaurants around £3.5 billion over the past 18 months.

Leon was founded in 2004 by John Vincent, Henry Dimbleby and chef Allegra McEvedy, who developed it as an alternative to traditional fast food establishments, offering a wide selection of wraps, salads and hot dishes.

The chain was founded and bought by the Issa brothers in 2021 in a deal worth around £100 million, which came shortly after they bought Asda in a highly leveraged £6.8 billion deal.

< p>After growing their empire rapidly over the past decade thanks to cheap debt, the Issas have spent much of 2023 selling off assets to cut borrowing as interest rates rise.

Earlier this week, EG Group announced the deal for the sale of 218 KFC franchise restaurants to Yum! Brands.

A Leon spokesman said: “While business continued to recover in 2022 from the lingering impact of Covid-19, overall market conditions remained challenging.”

” This included the impact of the war in Ukraine , which led to inflationary pressures – especially on electricity and cost of sales – and strikes on the rail network, which at the time affected restaurants located near transport hubs.”