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Thu 6th Dec 2012 - Cote, New Pub Company and Town and Country

Story of the day:

London and Edinburgh Swallow Group boss Alan Bowes makes pub sector comeback: Alan Bowes, who previously ran the London and Edinburgh Swallow Group (LESG) managed and tenanted pubs and hotels business, which went into liquidation in 2006, has re-emerged as a director of Scottie Pub Company. Bowes, who was made bankrupt in early 2007, became a director of Scottie Pub Company on 6 November – the company was incorporated on 18 October, which was Bowes 56th birthday. Scottie Pub Company runs distressed pub and hotel assets, mostly in Scotland but with a handful of properties south of the border. London and Edinburgh Swallow Group ran around 671 pubs and hotels on a managed and tenanted basis at its height, employing 7,300 people. It generated around £150m by selling pub freeholds at auction with a lease to itself at higher than market rents, generating profits on the freeholds it had previously acquired. The company went into administration in September 2006 and a month later fellow auction-focused Provence Pub Company went into administration after its banks tightened lending in the wake of LESG’s demise. Bowes was declared bankrupt in early 2007. The collapse of LESG left many hundreds of pub tenants having to deal directly with the individuals who had bought freeholds at auction. Bowes is based at Kingsburgh House in the Murrayfield area of Edinburgh, a five star bed and breakfast venue that is owned and run by his girlfriend Andrena Salter.

ALMR National Restaurant Show Study Tour in Chicago open for bookings: The Association of Licensed Multiple Retailers (ALMR) has opened its study tour to the National Restaurant Association Show in Chicago in May 2013 for bookings. Next year’s visit takes place between Thursday 16 May and Monday 20 May. The ALMR launched its first study tour trip to the NRA show this year, with the trip led by Propel Morning Briefing managing director Paul Charity. The NRA draws 58,000-plus industry professionals from all 50 states and 100 countries, all seeking the newest innovations and up-to-the-minute information about trends and issues. The ALMR trip provides: insights from industry experts on the rise in fast-casual dining, social media, new and emerging brands, menu development, staff management and a host of other issues – with 70 free education sessions; involves a tour of Chicago’s hottest concepts and a market overview briefing sessions from US experts. ALMR chief executive Nick Bish said: “Our first trip in May this year was a tremendous success with our attendees reporting they had benefited enormously from the visit to the Show and the chance to study the key trends in the innovative US market.” Paul Charity, managing director of Propel Info, said: “The NRA show is a fantastic opportunity to find fresh inspiration and understand the emerging trends shaping the fast-changing US market.” To book a place, e-mail Jo Charity on or call her on (01444) 810304. Places are limited.

Industry news:

Government gives new Pub is the Hub fund £150,000; Diageo chips in with £50,000: Pub diversification body Pub is The Hub has launched a New Community Services Fund to help UK pubs to diversify into new services provision for their own communities. Pub is the Hub, celebrating its tenth birthday, is looking to raise £1m over the next two years to allow it to provide national coverage in supporting pubs. The government has kick-started the fund with a £150,000 donation whilst drinks company Diageo has donated £50,000. Pub is the Hub chief executive John Longden said: “When I think of what we have achieved in the last ten years with relatively modest funding I know that we could do so much more with a national fund to fill those gaps. We are currently able to leverage every £1 in donations by a factor of seven so we really make every penny count. I’m enormously grateful to the Minister Brandon Lewis and Diageo for their incredible support over the years and for their significant contribution to kick-start The New Community Services Fund. I sincerely hope that other organisations will be able to follow their example. ” Diageo chief executive Paul Walsh added: “I believe that the Community Services Grant Fund will help more licensees to make a real difference in their local community, to improve their local economy and to support local suppliers. I am delighted that Diageo is making the first donation to the fund and I know that by continuing to work together, as an industry and at a local, community level, we can secure a future for those communities that need the most help.” Initiated by HRH The Prince of Wales in 2001, Pub is the Hub has grown each year but has survived on modest funding from supporters since then. A boost in funding from the Big Lottery Fund from 2010 for regional workshops and the launch of a nationally-funded scheme for pubs in Wales has highlighted the need for national provision across the rest of Britain.

Government ignores beer duty escalator in Autumn Statement: Hopes that Chancellor George Osborne might review the duty escalator in yesterday’s Autumn Statement fell flat. Greene King chief executive Rooney Anand said: “Our local pubs, the heart of their communities, operate in an environment of increasing taxes and red tape, often leading to closures. We would have welcomed the scrapping of the beer duty escalator, which continues to accelerate the rate of pub closures in communities across the country.” 

Starbucks expected to start paying as much as £10m a year in corporation tax: Starbucks is reported to be close to agreeing a settlement with HMRC that would see it paying as much as £10m extra a year in corporation tax – more than the £8.6m it has paid in 14 year of operating in the UK. The payments from Starbucks would be a high proportion of the royalty it pays to its European headquarters in Amsterdam.

Ramsay family feud erupts again: The feud between chef Gordon Ramsay and his father-in-law Christopher Hutcheson erupted again yesterday with the latter lodging a petition to wind up Gordon Ramsay Holdings. Hutcheson’s action comes after the failure to pay a £2m settlement agreed after Hutcheson’s acrimonious departure from the business.

Daily Mail diarist claims Caring selling stake in Cote for £113m: Daily Mail diarist Richard Kay has claimed this morning that restaurant investor Richard Caring is in line to sell his stake in French brasserie chain Cote for £113m – his original investment was £8m. Cote Restaurants reported turnover increased by 38.7 per cent to £49.3m in the year to 29 July 2012. Ebitda increased £3.3m to £10m, an increase of 46.6 per cent – with Ebitda as a percentage of turnover increasing from 19.2 per cent to 20.3 per cent. Pre-tax profit jumped to £6,916,508 from £3,971,680 the year before. The company operated 32 restaurants at its year-end with a “good pipeline” of sites.

Company news:

Apres bars operator Town and Country Inns reports losses after site disposals: Birmingham-based Town and Country Inns, which operates Apres Bar sites in Birmingham, Solihull, Lichfield, Cheltenham and Mere Green, has reported a pre-tax loss of £681,887 on turnover of £7,014,037 in the year to 31 May this year. The company made a pre-tax profit of £22,951 on turnover of £9,090,468 the year before. The losses were incurred after an exceptional item of £841,022, as it underwent “significant restructuring in order to compete with the difficult trading conditions in the sector and the competition in the surrounding market place”. Town and Country disposed of three bars and opened the Mere Green site. The company added: “There are further plans to open an exciting new entertainment venue in Birmingham in the early part of 2013 and this, the directors believe, will have a positive impact on the operations of the business.” Gross margin achieved during the year was 72 per cent compared to 71 per cent the year before. Operating margin excluding exceptional items was 9.7 per cent compared to six per cent the year previous. 

New pub management firm Tangerine Taverns created: Multi-site pub operator Town and Country Inns Management Solutions, headed by Ross Wallis and based in Nateby, Lancashire, has changed its name to Tangerine Taverns. The move comes as it re-opens The Farmers pub, in Garstang, as The Bell and Bottle. For much of the past three years the pub had traded as an Italian restaurant, Salvatore’s, before the lease was taken over earlier this year by Town and Country Inns. Tangerine Taverns is in the process of buying the freehold of the building from owner Punch Taverns. Wallis said: “The pub has seen considerable investment over recent months and now offers a fantastic two main meals for £10 menu as well as private function and conference facilities. We have re-branded this month following a large-scale expansion of our business. The company now employs more than 500 staff members.”

Stella Inns takes fifth Punch site: Stella Inns, the Midlands multiple led by Tim Joudrey, has taken its fifth Punch taverns pub – The Wild Man, in Norwich’s Bedford Street, re-opens on 12 December after a £200,000 joint investment. Joudrey said: “This is our fifth Punch site and we wanted to take the opportunity to work on a city centre pub. Considering the pub’s prime location, we could see its potential and we shared Punch’s vision to re-position The Wild Man as offering good quality food and drink to shoppers during the day and high standard entertainment by night. The Wild Man has been transformed into a contemporary city pub with stylistic finishes but has kept some traditional and rustic elements, such as the chunky wood furnishings, to create a warm and cosy feel. We plan to specialise in quality drinks with a broad range of speciality coffees, real ales, fine wines and premium spirits.”

New Pub Company opens 50-seat pizza restaurant above award-winning pub: New Pub Company, the seven-strong multiple headed by Peter Linacre, has opened a 50-seat pizza restaurant above its Camden Eye pub in London, which is run by BII Licensee of the Year Mahdis Neghabian. Camden Eye Pizza offers pizzas cooked on site in a wood-fired oven with all pizzas priced at £10. Linacre has previously told Morning Briefing that the offer has been inspired by a visit to The Bull’s Head in Repton, Derbyshire, where former BII Licensees of the Year Richard and Loren Pope pioneered a pizza offer in their bar area that is as alternative to their full menu.

Leisure analyst Douglas Jack issues “buy” note on Enterprise shares: Numis Securities analyst Douglas Jack has issued “buy” note with a target price of 110p on Enterprise Inns shares. He said: “Yesterday, management presented to our sales team. Although the shares have tripled over the last year, they should still offer attractive upside from debt reduction and re-rating if the company returns to like-for-like net income growth, which should be possible in 2013E. In the medium-term, we believe the company targets two per cent like-for-like net income growth, equivalent to ten per cent plus earnings growth. The next major target is to grow like-for-like net income, which was effectively flat during the washout summer outside the Olympics. A number of factors could help this occur, including: selling more higher margin products; buying cheaper; and supplying Sky TV and food to tenants, applying bulk purchasing discounts, benefiting both parties. Over the next three years, management expects to sell c.700 pubs (of which c.600 should be from the tail). This should result in net cash flow (£200m per annum) being double free cash flow (£100m per annum), enabling £310m of bank debt, £60m of corporate bonds and £130m of Unique bonds to be repaid over the next three years. The discount on the bonds is only circa ten per cent, but spare cash could be used to retire bonds if discounts widen.”

Multi-site Papa John’s franchisee nominated for award: Papa franchisee Mohammed Zulfiqar Haidar, has been nominated for a Scottish Asian Business Award. Haidar runs his Papa John’s franchise operation with his brother Iftikhar and they have recently opened their third pizza outlet on Duke Street in Glasgow. The Duke Street opening also marked the 200th Papa John’s store opening in the UK.

Nando’s opening three sites this month: Peri-peri chicken brand Nando’s is opening three sites this month. The new openings are in Hammersmith, west London, Watford’s Met Quarter and in Llanelli, south Wales.

New nightclub in Leicester gets go-ahead: A new nightclub in the middle of Leicester’s cultural quarter has been given the go-ahead – despite opposition from dozens of residents. A panel of city councillors approved a licensing application to open the 180-capacity Dielectric in the basement of a Victorian building opposite Curve theatre, turning the former G-Spot club into a venue for live bands and club nights – it is being opened by local businessman Tim Sturgess.

Claude Bosi sets February 2013 opening date for Brakspear pub: Chef Claude Bosi and brother Cedric have set a February 2013 opening date for their second pub site, Brakspear’s The Malt House in Fulham. The Malt House will serve modern British pub food, with a focus on seasonal ingredients, in an informal, friendly setting. The kitchen will be headed up by Marcus McGuiness, who is the former head chef at Claude Bosi’s two Michelin starred restaurant Hibiscus in Mayfair.

One World Buffet fined £5,000 over food hygiene breaches: One World Buffet has been fined £5,000 after admitting four charges of breaching food hygiene at its Peachy Keens site in Little Wind Street, Cardiff. The company was ordered to pay a further £3,409 court costs. A spokesman said: “The incident which led to this penalty dates to more than a year ago, immediately after One World Buffet took over from the previous operators. Over the year since we have been working as per recommendation of Swansea Council officers.”

Former landlady sues Brakspear for £975,000: Henley-based Brakspear is being sued for £975,000 by a licensee for injuries incurred while climbing the ladder in her pub on New Year’s Day. Mira Bateman was tenant of The Plowden Arms, in Shiplake Cross, near Henley-on-Thames, when an accident occurred as she returned decorations to the attic. She claims it is Brakspear’s fault because it did not provide proper access to the attic - she suffered a broken jaw, a missing tooth and neck injuries. Brakspear denies liability and judge has reserved a decision on whether the case can proceed.

Harvester and PizzaExpress scoop awards in Mumsnet awards: Harvester and PizzaExpress have both won a silver award in the Mumsnet Family Friendly awards hosted by deputy prime minister Nick Clegg. Mumsnet, an influential website for parents, launched the Family Friendly programme in March 2011, responding to research that showed that 93 per cent of Mumsnet users said that Britain’s businesses weren’t family friendly enough. Awards recognise companies for their contribution to family friendliness, with bronze, silver and gold categories given out in recognition of family friendly practices and ‘secret shopper’ scrutiny. Two independent pubs, The Manor Arms and The Abinger Hatch, were awarded gold for their commitment to offering an excellent family experience.

Trial begins for Hampshire couple accused of torching Enterprise pub for insurance money: A trial has begun for licensees Dean and Melynda Thomas who are accused of starting a fire that caused more than £100,000 damage at The Tollhouse Inn in Lymington, Hampshire. It had been started deliberately as an insurance scam because the business was failing, jurors were told. The couple deny the charge and the case continues.

Private buyer acquires Kings Arms in Amersham: An unnamed private buyer has bought The Kings Arms in Amersham off a guide price of £2.5m. The venue came on the market after the directors of Zola Hotel decided to retire. The Kings Arms Hotel was refurbished and extended by Zola Hotels in 2006 to provide 32 individual en suite boutique bedrooms, a traditional pub and a formal restaurant. It is prominently located on Amersham’s High Street. Stewart Harkness of agent Christie + Co said: “The Kings Arms Hotel has been generating an operating profit of £260,000 per annum. It is in excellent condition and the buyers recognised its excellent future potential.” A second Zola hotel, The Westcliff Hotel in Southend is still on the market but reported to have attracted a lot of interest.

Domino’s supporting ITV Text Santa campaign: Domino’s UK has teamed up with ITV to support the Text Santa Campaign. Domino’s is offering its customers the opportunity to donate money to charity everyday via Pennies, the electronic charity box, until the end of the year. Every Domino’s customer that orders their pizza online or via the mobile app will be given the option to round up their order and donate those spare pennies to the Text Santa charity appeal. Simon Wallis, sales and marketing director for Domino’s, said: “Text Santa is a great campaign and one we are proud to support. Giving our customers the opportunity to donate their spare change to this charity appeal was an easy decision for us.” 

McDonald’s wins go-ahead for 24-hour site by promising to clear litter within a half mile: McDonald’s has won planning consent for a 24-hour restaurant in Handsworth, Sheffield despite a campaign from nearby residents opposing the plan. More than 100 signatures and 15 letters of objection were submitted with concerns over litter and noise uppermost. Paula Reed-Smith, an acquisitions surveyor for McDonald’s, said: “There have been concerns about litter and we have listened to them. Bins are provided to customers and our employees carry out a minimum of three litter patrols every day, not just around the restaurant, but within a half-mile radius of it and we work with communities to tackle the problem.”

Newman Street Tavern gastro-pub opens in Fitzrovia: The Newman Street Tavern has opened in Fitzrovia’s Newman Street on the site of a former Ping Pong dim sum restaurant. It’s headed up by Peter Weeden, who previously worked at Paternoster Chop House and Boundary restaurant. The site has had a chequered history with a variety of names, including The Cambridge Arms, the Cambridge Stores and the Garrick’s Head.

Michelin-starred chef plans Birmingham restaurant: Michelin-starred chef Adam Stokes is planning to open a pop-up restaurant in Birmingham. Stokes is quitting his post as head chef at the Michelin-starred Glennap Castle in Scotland to set up his first solo venture. Stokes will open Adam’s in Bennett’s Hill in March 2013 as a 25-seat “pop-up”. The restaurant will run for an initial 18 months but he has his sights set on a larger 60-cover restaurant in Birmingham, which he plans to open once he has established his reputation. The pop-up is part of a plan that Stokes believes will help him create the best restaurant in Birmingham.

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