The Hard Rock Cafe brand experienced a 16% fall in operating profit during 2003, as tourists shied away from city locations and currency fluctuations devalued earnings.
Despite a 2.4% increase in like-for-like food and beverage sales at the chain, an 11.2% drop in merchandise sales in major tourist locations such as Paris, Rome and London produced a "disappointing" performance. Operating profit for the full year was down from £27.6m in 2002 to £23.1m.
Mike Smith, chief executive of parent company Rank Group, said losses would be offset with plans to expand the Hard Rock brand into other areas, principally hotels and casinos. The company opened its first Hard Rock hotel in Chicago at the end of last year in a joint venture with Spanish hotel group Sol Meli .
Ten new cafes will open this year, half of which will be franchised; and the world's first Hard Rock Bar is set to open in Bristol in April, heralding a UK-wide rollout if the concept is shown to be successful.