REGENT Inns, the firm behind Australian theme bar Walkabout and the Jongleurs comedy clubs, said the effect of the smoking ban was continuing to hit hard.
The company has already issued one profit warning last December, which led to it being seen as a takeover target. It has now said profits continued their descent in January.
Like-for-like sales in the half year to December 29 were down 3.8 per c
ent, compared with the previous year.
The company also posted a one per cent fall in the 14 weeks to October 6. Pre-tax profit for the half-year fell to £1.2 million, down from £3.6m.
Executive chairman Bob Ivell remained upbeat. He said: "Our brands remain strong and well-positioned to take advantage of a recovery."
The group said November and December saw a deterioration in market conditions across the sector, with Walkabout, which has a branch at Edinburgh's Greenside Place, particularly badly hit.
Regent said that despite the sector conditions, the Jongleurs clubs had demonstrated an ability to trade "robustly".
In its latest trading update, Regent said it "strongly believes" its poor performance is attributable to the slowdown in consumer confidence and the impact of the smoking ban.
Greg Feehely, an analyst at Altium Securities, called the immediate outlook for the company "very challenging".
