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Mon 14th Jan 2013 - Gary Rhodes, Giraffe and Greene King

Story of the day:

Greene King reports record Christmas sales: Suffolk-based Greene King has reported record Christmas sales. Chief executive Rooney Anand said this morning: “Our strong momentum has been maintained over the last six weeks. We achieved record sales through Christmas and the New Year as our teams once again delivered excellent value, service and quality to our customers. Pubs continue to play a vital role for customers, families and communities across the UK during the festive period, especially in this difficult financial environment. We once again achieved record Christmas bookings and strong like-for-like sales growth across Christmas and the New Year. We achieved record Christmas Day sales of £2.7m, up 6.8 per cent, and during the whole of December, we sold 448,000 Christmas meals, another record for Greene King.” Total sales in the managed division, Greene King Retail, were up 9.5 per cent after 36 weeks to 6 January, with like-for-like sales growth of 3.7 per cent. Like-for-like growth in the last six weeks is 2.8 per cent, following 8.8 per cent growth in the comparative period last year. Like-for-like food sales growth is running at 4.1 per cent in the year-to-date. The company has added 22 sites to its managed division so far in this financial year to reach a total of 975 – it has a target of 1,100 managed pubs. The tenanted division’s performance trends are improving following a strong festive period. After 36 weeks, average EBITDA per pub was up 4.2 per cent. A total of 65 non-core sites have been sold in the financial year to date. Core own-brewed volume was two per cent down after 36 weeks, maintaining its outperformance against the UK ale market down 4.2 per cent. The company added: “Our two lead brands, Greene King IPA and Old Speckled Hen, are both ahead of last year on the back of our continued marketing investment and product innovation.”

Propel Multi-Club conference: The first Propel Multi-Club conference takes place at One Moorgate Place, London EC2R 6EA on Tuesday 19 March and multi-site companies can book two free places each on a first come, first serve basis - more than 100 places have already been booked so far. The speaker list will be unveiled later this month. E-mail to book places.

Propel Quarterly magazine available online: The winter 2012-2013 edition of Propel Quarterly magazine is now available to view online at

Industry news:

£3m campaign aims to revive beer: The Global Brewers Initiative, created by a consortium of the nation’s largest brewers including Anheuser-Busch Inbev, Molson Coors and Budweiser Budvar UK working alongside the British Beer & Pub Association, is aiming to improve the public’s opinion of beer and revive the sector in a campaign thought to be worth £3m. In May last year, the brewers appointed Rainey Kelly Campbell Roalfe/Y&R to handle the advertising campaign for the launch. The agency has been tasked with creating a campaign, which is expected to break later this year, to help change attitudes towards the brewing industry and reflect the positive approach that brewers have taken in promoting responsible drinking.

Government forecasts drops in beer and cigarette consumption, rise in wine: Forecasts by the Office for Budget Responsibility suggest that the UK will be drinking one-fifth less beer by 2018, with consumption dropping from 53.2m to 43.9m hectolitres. Smokers are expected to cut back by almost a quarter, from 41.8bn to 32.8bn cigarettes a year. Meanwhile, wine consumption is forecast to rise from 13.9m to 16m hectolitres, with little change in the consumption of spirits. Overall, the UK will be drinking about 2.4bn units of alcohol less by 2018. Despite falling sales, tax revenues are expected to rise by £3bn to £23bn by 2018 due to above-inflation prices increases.

Eggs prices rise by 40 per cent in a year: Eggs prices have increased by 40 per cent in the past year as a result of the cost of feed rising and the introduction of new animal welfare rules. A survey by Grocer magazine found that all big four supermarkets were selling a pack of six eggs for less than £1. A year on, only Asda and Morrisons are selling six eggs for less than £1 and the average price increase is 40 per cent.

More than 20 per cent of households now own a coffee machine: More than one in five households (22 per cent) can now make their own espressos, lattes and cappuccinos with a coffee machine compared to 18 per cent in 2008. Sales of coffee makers increased from £52m in 2008 to £69m in 2012. Meanwhile, the sales of kettles has dropped from 8.1m in 2007 to 7.5 million in 2012.

Twilight star voices support for the pub – wants to buy one: Twilight star Robert Pattinson has revealed he wants
to buy a real working men’s pub. He said: “I probably wouldn’t even go public that I owned it. I wouldn’t want it to become the sort of place people went to spot celebrities. I just want it to be a real pub where men discuss the issues of the day. The UK is the home of pubs, and we need to make sure we protect them. Every time I am back home and see that a local pub has closed down it actually makes me sad. The local can be the focal point of the community, and if we lose them we lose one of the things that is greatest about Britain.”

Restaurant groups hold the line on price: Restaurants groups, faced with value-hungry customers and rising commodity prices, are refusing to implement significant menu price increases, according to a new survey of industry executives conducted by SpenDifference, a supply chain co-op that helps restaurants save money. Midway through the fourth quarter of 2012, annualised price increases were averaging between 1-1.5 per cent, with companies expecting to take some additional late-year pricing increases. In 2011, the majority of companies also reported raising prices about 1.5 per cent.

Red wine offsets risks to heart of red meat: Scientists have found that one glass of red wine can offset the build-up of cholesterol that occurs after a meal of dark or red meat. A group of volunteers studied by The Institute of Drug Research at The Hebrew University of Jerusalem were found to have stable or falling cholesterol when they ate cutlets and also drank red wine.

Oasis, Meadowhall wins refurbishment award: The new Oasis Dining Quarter at Meadowhall Shopping Centre has been hailed as the retail property industry’s ‘Best Refurbishment’ at the British Council of Shopping Centres awards. Oasis saw a £7 million redevelopment of its food court to transform the area into a sleek and contemporary 61,000 square foot dining space. Davis Coffer Lyons was instructed by British Land, joint owner of the centre, to give strategic advice together with marketing to revamp the foodservice offer at Meadowhall, which was completed in October 2011.

Planning rules force developer to build new pub: Cambridge developer Danescroft has submitted plans for the first new “local” pub in Cambridge for years after planning rules frustrated a housing plan. The new pub, The Queen Edith, would stand on the site of the existing pub of the same name in Wulfstan Way which shut in December 2011. The closure left residents with no neighbourhood pub and the site was sold by Punch Taverns four months later. But new owner Danescroft has submitted an application to build a smaller pub, plus 12 two-bedroom flats in a three-storey block to the rear. The proposals are the first of their kind to emerge since Cambridge City Council adopted new rules which only allow the loss of a pub if it can be proved it is no longer needed by the community. An application to replace the pub with eight houses was rejected two years ago.

Company news:

Lovely Pubs reports December like-for-likes up 12 per cent: Lovely Pubs, the six-strong operator of food-led pubs run by Paul Salisbury and Paul Hales, the brains behind Mitchells & Butlers Premium County Dining Group of gastro-pubs, has reported December like-for-likes were up by 12 per cent. Salisbury told Morning Briefing: “Trading was very strong from the 19th December and has continued into the New Year.” Star performer was the company’s Farm site, which has been likened to a “posh Harvester”, with sales of £89,000 gross in a single week and £29,000 of turnover on Christmas Eve alone. Said Salisbury: “It’s an incredibly well-supported site – you only have to look on Trip Advisor. We had a lot of corporate business and the weather in December was pretty good.” On the Farm, he added: “We’ve tweaked the menu and made it slightly bigger with more barbecue items and a number of unusual salads.” For January, Lovely Pubs has introduced a two-for-one pizza offer at its Morton’s Deli site and also introduced a fish night and game night on different evenings, with wine offered at half price – an idea that Mitchells & Butlers uses at its Premium Country Dining pubs.

KPMG called in at Ever So Sensible Bars: Administrators from KPMG have been called in at Ever So Sensible Bars, which operates four sites. The four sites affected are: The Castle pub on Castle Road in Nottingham; The Dogma bar and kitchen on Byard Lane in Nottingham; The Dogma bar and kitchen in Lincoln; and Bad JuJu on Broad Street in Nottingham. The sites continue to trade while a buyer is sought. All of the other restaurants and pubs within the Ever So Sensible Group, which includes four Le Mistral restaurants and four other pubs, are operated by Ever So Sensible Restaurants Limited, which is not in administration and continues to trade as normal.

YO! Sushi offering a free plate of sushi next Monday: YO! Sushi is offering a free blue plate of sushi next Monday. To claim the free blue plate, customers have to say the secret password – ‘Cheery Nigiri’! YO! Sushi already offers dishes from the conveyor belt for just £2.40 each on a Monday.

Giraffe reports like-for-likes up five per cent in December: Restaurant group Giraffe, founded by husband and wife team Juliette and Russel Joffe, has reported like-for-like sales grew by five per cent in December, according to The Sunday Times. Overall turnover at the 48-site company rose by 17 per cent. The company made a profit of £4m on turnover of £40m in its most recent financial year. The next site will open in Leeds in May with six planned for this calendar year. It opened it first overseas site at the new airport terminal in Dubai.

OFT delays AG Barr and Britvic merger decision: The Office of Fair Trading (OFT) has extended the timetable for its decision on the merger of AG Barr and Britvic because “it has not yet completed its review”. As a result, the timetable for the implementation of the merger is being extended - the anticipated effective date of the merger will no longer be 30 January 2013 as previously announced. Britvic and AG Barr are awaiting a revised target decision date from the OFT, which is now expected to be in February.

Cirrus Inns hires Skylon executive chef Helena Puolakka: Cirrus Inns, headed by Alex Langlands Pearse, has hired Helen Poulakka, executive chef at Skylon, as its new operations director, replacing Mark Askew. Finnish-born Puolakka, who has been at the helm of Skylon at The Royal Festival Hall since its launch in 2007, will join on 4 March. Former Gordon Ramsay Holdings executive chef Askew will remain a shareholder in the business but is moving on to work on an a counter service project with Richard Caring called Grillshack along with former ETM Group and Hakkasan executive Hannah Bass. Meanwhile, Cirrus has bought The Fish House Hotel and restaurant in Chilgrove, West Sussex, and will re-open it under its original name, The White Horse, later this year. The Fish House was put on the market for £3m after falling into administration in April 2011. Former owner David Barnard spent £4m on transforming the property after purchasing it in February 2008.

Harris + Hoole founder – Tesco involvement has not been a secret: The founder of the Harris + Hoole coffee shop chain has expressed surprise that an investment in the company by Tesco has become a source of controversy in the past fortnight. Nick Tolley said: “(It) came out in August when we opened our first shop so it’s hardly been news. If you Google Harris + Hoole or look on our website or Facebook page, one of the first things that pops up is the Tesco involvement.”

JD Wetherspoon lines up Burgess Hill, West Sussex site: JD Wetherspoon is lining up an opening in Burgess Hill, West Sussex with a plan to convert two shops in Church Walk – Currys and Sussex Stationers - to a pub. A Wetherspoon spokesman said: “Wetherspoon has exchanged on the site, but not yet completed the deal. If the pub was to open Wetherspoon would look to spend £1.2million developing it and creating 40 new jobs.” Burgess Hill Town Council has recommended refusal of the application by district councillors. It has told the district council it would be “unneighbourly” to surrounding residents.

Subway wins right to take VAT case to Court of Appeal: Sandwich firm Subway has won the right to take its fight over VAT on toasted sandwiches to the Court of Appeal. The company is arguing that VAT should not be applicable on the sandwiches in a case that could be worth as much a £1bn to the Treasury. The case is expected to be taken to the European Court if the Court of Appeal rules against Subway. 

Moorhouse’s reports December production up nine per cent: Burnley-based brewery Moorhouse’s has reported sales were up nine per cent in December following similar growth during November and October. The company opened a state-of-the-art £4.2 million brewing complex in 2011, which allowed it to treble its former production capacity to 15 million pints per year. Managing director David Grant said: “Sales at the start of the December were slow, but pubs were helped by the milder weather as people decided to get out and celebrate despite the economic gloom. Once again our acclaimed brews surpassed all previous sales to enjoy very healthy growth and beat the outstanding Christmas of 2011.”

Polizzi-mentored hotel in Plymouth closes: The 54-bedroom Astor Hotel in Plymouth – which Alex Polizzi mentored in the Channel Five programme The Hotel Inspector in 2010 - has closed with 12 staff made redundant after the property fell into administration. Nigel Morrison and James Stares of Grant Thornton have been appointed as joint administrators of both the trading company, The Astor Hotel Limited, and also Joseph Louei and Sons (Holdings) Limited, which owns the site.

Nightclub plan for historic Londonderry event: One of Northern Ireland’s most historic halls is to become a nightclub and restaurant after its new owner was granted planning permission for development. St Columb’s Hall, in Londonderry, which was bought from the Catholic Church last year, began life as a temperance hall in 1886. The Garvan O’Doherty group has been given the go-ahead to convert the basement into a nightclub, put a restaurant on the second level and carry out refurbishment work on the existing auditorium and cinema.

Marston’s wins planning go-ahead in Diss, Norfolk: Marston’s has won planning consent to build a pub restaurant on a main road running through Diss. The development will be built on the former Hamlin factory site in Park Road. South Norfolk Council’s planning committee unanimously backed the plan at a meeting last week, one year after councillors approved an outline planning scheme to build a 60-bedroom hotel and restaurant on the site.

Wadworth develops small run Brewers Creations: Brewers at Devizes-based Wadworth & Co have been given carte blanche to create a range of craft ales to be released under the banner of Brewers’ Creations thanks to its new microbrewery plant. Head brewer Brian Yorston said: “It’s brewers’ heaven at Wadworth at the moment. We are very happy brewers, creating exciting recipes, experimenting with new techniques and applying our knowledge and experience to stretch boundaries and brew some fabulous off-the-wall beers that really challenge us and will challenge our customers.” Different beer will be brewed each month and sold under the Brewers’ Creations umbrella - currently it is a smooth 7.1 per cent stout and in February it will be an highly hopped pale ale at five per cent.

Delayed Gary Rhodes restaurant to open in Plymouth at the end of the month: A new £1.5 million Gary Rhodes restaurant will open on Plymouth Hoe - The Rhodes @ The Dome restaurant – on Friday, 25 January. The Dome, a former tourist attraction that has stood empty since it closed in 2006, occupies a prominent position overlooking Plymouth Sound. The venue had been scheduled to open last November, but plans had to be scrapped when metal thieves attacked the building causing tens of thousands of pounds of damage by ripping lead flashing from the roof and stealing valuable copper piping.

North west- based Camerons on the search for pub acquisitions: Brewer and pub operator Camerons, which has an estate of 69 pubs, is looking to buy groups of pubs which have been neglected or where the owner has gone bust. Chairman David Soley said: “This may be a challenging market, but it is not the end of pubs at all. They are a UK institution, and what we have been seeing over the last few years of the recession is just a slimming down as we listen harder to what people want from their pubs. We are doing more food and going less for pubs focusing on wet sales. I expect there are some good deals out there.” The group completed a new £24.7m funding package from the Royal Bank of Scotland last week.

Simon French reiterates buy recommendation of Wetherspoon: Panmure Gordon analyst Simon French has repeated his Buy recommendation of Wetherspoon shares ahead of a trading update this Wednesday. He said: “We expect the group to report continued market leading performance with a fairly strong Christmas and New Year trading period. In Quarter One (13 weeks to 28 October), like-for-like sales increased 7.1 per cent but we expect this to have moderated to circa five per cent for the year to date and with margins stable at 8.6 per cent. The momentum is firmly with Wetherspoon and the stock price historically responds very well to like-for-like sales growth outperformance. As such, we reiterate our Buy recommendation and 615p Target Price.”

Smashburger targets up to 75 openings this year: The US fast-growing better burger concept Smashburger plans to open between 60 and 75 sites in 2013. The brand opened its 194th unit this week in Los Angeles, the first outside the Denver area to feature a new décor package that will define the concept’s next generation of restaurants. Three units in Smashburger’s hometown of Denver have tested the new look, and the chain is ready to move forward in company-owned restaurants with the design, which brings modern touches to the fast-casual brand.

Ruby Tuesday scraps Marlin & Ray’s brand to focus on core brands: US restaurant operator Ruby Tuesday is closing its 13 Marlin & Ray’s restaurants immediately to focus its efforts on improving the performance of its core Ruby Tuesday brand and fast-casual concept Lime Fresh Mexican Grill. “The Marlin & Ray’s brand does not represent a meaningful conversion opportunity for us going forward,” said company chief executive James Buettgen. “We believe these are the key brands for our future, and we want to ensure that they are getting our full and undivided attention as a company.” The move is a big turnaround from its position in 2011 when it described Marlin & Ray’s as its key growth brand. 

York pair took over fourth pub: York real ale specialists Paul Crossman and Jon Farrow have taken over their fourth pub in the city, The Woolpack Inn in Fawcett Street, which will stock five Timothy Taylor beers permanently. They also operate The Swan in Bishopthorpe Road as well as The Slip Inn and The Volunteer Arms in Holgate. Crossman said: “We are buying these pubs off the big pub companies because they are struggling to make them work. The Slip was really struggling, but we have quadrupled its turnover. With The Woolpack we are going to stick to what we know. We don’t do food, but we are all about community. It’s just outside the city centre, but it will also have a community feel about it.”

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