Propel Morning Briefing Mast Head CPL Learning Link Paul's Twitter Link Greene King Banner
Morning Briefing Strap Line
Tue 5th Feb 2013 - McDonald’s, M&B and Pret A Manger

Story of the day:

PizzaExpress operator reports operating profit down 23.1% to £36.7m; 31 million pizzas sold through supermarkets: Restaurant company Gondola Holdings, the operator of 680 UK restaurants owned by private equity firm Cinven, has reported, in accounts filed last Friday, that turnover rose 3.9% to £591.7m in the year to 1 July 2012. The company, which employs 15,000 people and serves 40 million meals a year, opened 35 new restaurants and extended the term of its £550m of debt funding for two-and-a-half years to July 2015 - like-for-like sales were up 1.8%. A total of £25m of debt was repaid in the year and £22m of senior debt was due to be repaid last month. There was an impairment charge for 16 restaurants following a review of underperforming restaurants, which resulted in a 22.2% increase in depreciation to £32.5m. Operating profit was reduced by 23.1% to £36.7m. The company made a net investment of £56.7m in new restaurants and the maintenance of its existing restaurant estate, together with IT and other infrastructure. Net interest of £103.7m led to a pre-tax loss of £65m compared to £41.2m the year before. PizzaExpress (achieving an average spend per head of £14) with 413 restaurants added 16 during the year, Zizzi (achieving an average spend per head of £18) with 123 restaurants added five sites in the year, Ask (achieving an average spend per head of £18) with 126 venues added six in the year and Byron (achieving an average spend per head of £16) with 24 venues added eight during the year. Kettners, at a single site in Soho, achieves an average spend per head of £30. Chairman Chris Woodhouse said: “Given the strength of our brands, it is right that we use the opportunity of a depressed economy to invest at attractive prices for the longer term. So, despite economic pressure we have kept up the pace of new openings, adding a further 35 restaurants. We also continued to invest significant capital in our refurbishment and transformation programmes, making sure that our brands continue to evolve and our restaurants remain stylish and inviting environments in which to spend time.” The company reported that it believed there is scope for 250 more PizzaExpress sites in the UK. It also stated that it is selling 31 million PizzaExpress pizzas a year through supermarkets, taking a record market share. Retail earnings grew to £13.8m from £13m the year before. The company said it was “well-positioned” to “embark on the next crucial stage of growth beyond London” for Byron. Margin reduced to 12.8% from 15.4% the year before.

Industry news:

Barclays adds £400m to interest rate mis-selling provision: Barclays Bank has moved this morning to add another £400m to its provision to compensate small and medium-sized businesses that were mis-sold interest rate swap products. The extra money brings the cumulative provision to £850m, of which £36m had been utilised as at 31 December 2012. Barclays stated: “The main review and redress exercise will commence shortly and the appropriate provision level will be kept under ongoing review as it progresses.” The extra money comes after the Financial Standards Authority found 90% of the first trance of cases examined had elements of mis-selling. The administrators for multi-site pub company Sarumdale, which collapsed into administration last summer with its founders claiming they were mis-sold an interest rate swap, are currently pursuing a claim again the bank. The original £450m interest rate swap provision was already the largest of any UK bank.

Phil Strong – others must join the ALMR: The chief executive of Chameleon Bar and Dining Phil Strong has set out the company’s reasons for joining the Association of Licensed Multiple Retailers (ALMR) last week. He told Propel Morning Briefing: “We have decided to join as we see the ALMR as increasingly being the single body that represents our industry in the challenging times ahead. We would urge all licensed pub operators to support the ALMR and add weight to their position in representing us with the government and other statutory bodies.”

Punch pub wins Les Routiers Inn of the Year award: Punch Taverns’ Phoenix Inn in Hartley Wintney has been named “Inn of the Year UK” by Les Routiers for 2013. Licensee Sisi Ryder, who has been running the Phoenix Inn since November 2009, said: “I am very proud of the team’s achievement and it is a true recognition of the hard work they all commit to the business. We pride ourselves on creating traditional and speciality home-cooked dishes. All of our food is locally sourced with the emphasis on freshness and quality. It’s wonderful to be rewarded for our efforts.” The Les Routiers award comes after the pub won the award for the UK’s Best Sunday Roast in November 2012.

Dollar Menu McDouble Cheesburger under pressure as beef prices rise: McDonald’s $1 McDouble cheeseburger, which has been on the menu since 2008, is becoming harder to retain on the company’s ‘Dollar Menu’ in the US as rising beef prices threaten the company’s profit margin, The Chicago Tribune has reported. The McDouble has the highest ingredient costs on the Dollar Menu, making it a loss-leader unless customers add high-margin sides such as french fries or a soft drink. “If the McDouble is all the customer buys, you lose money,” Richard Adams, a former franchisee who now advises the chain’s other franchisees, told the newspaper. “Depending on what happens to beef prices, McDonald’s management should be open to taking the McDouble off the Dollar Menu.” McDonald’s obtains an estimated 10 to 15% of its sales from the Dollar Menu. Meanwhile, McDonald’s has launched an advertising campaign at the Superbowl in which it pledges to answer each and every question its customers ask. So far, there have been 19,000 questions. The tagline is: “One (question) at a time – and that’s just the beginning.”

Pret A Manger withdraws ‘offensive’ Virgin Mary crisps: Sandwich chain Pret A Manger has withdrawn its ‘Virgin Mary’ brand of crisps after a number of religious complaints. The company made the decision to pull the brand after campaigners on the Protect the Pope website pointed out the offensive crisps branding to its members. Responding to the complaints, the religious website says Pret a Manger has ‘apologised for any unintentional offence they have caused and have indicated that they will give any unsold crisps to the homeless’.

Winners of Sustainable Restaurant Awards unveiled: Wahaca, The Preston Park Tavern in Brighton, Feng Sushi, Café Ode and Babylon at the Kensington Roof Gardens have been unveiled as winners of the Sustainable Restaurant Association Awards 2013. Café Ode, in Shaldon, Devon, was chosen as Sustainable Restaurant of the Year for the second year of the awards organised by the Sustainable Restaurant Association (SRA) in association with Unilever Food Solutions. The Preston Park Tavern, operated by Andrew and Helen Coggins, won Sustainable Pub of the Year. Most Sustainable Small Restaurant Group of the Year is Wahaca, co-owned by former Masterchef winner Thomasina Miers and Mark Selby, for the second year running. The award for Most Improved Restaurant was won by Babylon in London in recognition of its improvement in all 14 of the SRA’s key sustainability areas. Feng Sushi picked up the Innovation award. The judges applauded the group’s commitment to work with UK producers to grow vegetables traditionally sourced from overseas as well as effectively ensuring a reliable supply of sustainable, seasonal fish.

Company news:

Chief executive of Smashburger – the fastest growing company in the history of US quick service restaurants - to present at first Propel Multi Club conference: Chief executive of US better burger chain Smashburger Dave Prokupek is to present at the first Propel Multi Club conference on Tuesday 19 March. Prokupek will explain the unique Smashburger better burger proposition - the company opens its 200th restaurant this month just six years after it was founded, making it the fastest-starting quick service restaurant chain in US history. Smashburger experienced a 71.5% increase in sales in 2012, to $118.7 million, helped along by unit performance growth of 53.8%. Forbes magazine recently placed Smashburger in first position on a list of 100 rising star companies in 22 industries – the only restaurant company to make the list. Forbes’s list named 100 companies that have “compelling business models, strong management teams, notable customers, strategic partners and precious investment capital”. Smashburger was founded in 2007 by Tom Ryan, a veteran of fast food chains including Quiznos, McDonald’s, Pizza Hut, and Long John Silver’s. At McDonald’s he introduced the company’s thin crust pizza, McGriddles, and the McFlurry. In 2009, Smashburger received a $15 million investment from Consumer Capital Partners to enable a major national expansion. Technomic vice president Darren Tristano has described Smashburger as “different” to other better burger concepts. “They have a broader menu – they don’t just have burgers and fries and hot dogs. They were very smart because they got into the right segment at the right time. This was made to be a growth chain.” Operators are entitled to book two free places at the Propel Multi Club conference – e-mail Jo Charity on Prokupek would also like to meet multi-site operators interested in becoming a Smashburger franchisee in the UK. E-mail to have your details forwarded to Prokupek. The Propel Multi Club conference takes place at One Moorgate Place, London between 10.30am and 5.15pm. 

Restaurant company to open Mexican concept in Leeds: Restaurant and bar group Leelex is to open a new Mexican concept in the £350m Trinity Leeds development. Leelex, which owns Jake’s Bar, Oporto and Neon Cactus on Call Lane, Leeds and The Hummingbird in Chapel Allerton, will now open Cielo Blanco. The restaurant will be a 125-seat restaurant serving healthy Mexican food. The name Cielo Blanco, meaning ‘white sky’ was inspired by the curved glass roof that spans the Trinity Leeds shopping and leisure development that will house the new restaurant. Leelex directors Ged Feltham and Paul Lane have been on several trips to Mexico to sample food and drink that they can incorporate into the new restaurant. It will open on 21 March.

Burger King reviews £40m account: Burger King is reviewing its £40 million pan-European media planning and buying account, according Campaign magazine. The marketing campaign claims that the burger company is looking to appoint a media network to work on its business in markets including the UK, Norway, Spain, Sweden and Denmark. The Interpublic network Initiative currently handles the £12 million UK account and is also the incumbent in Spain, Sweden and Denmark.

Petition against Costa opening in Bakewell attract 6,000 signatures: A campaign against Costa opening in Bakewell, Debyshire, has attracted more than 6,000 online signatures in six weeks. Organisers have been in contact with campaigners in Totnes, Devon, who successfully stopped Costa opening in their town, and a similar group in Ripon, North Yorkshire. But with planning permission already granted they are now appealing directly to Costa to urge them not to open in the town. Nigel Johns, a campaign co-ordinator, said: “We genuinely want to protect the long-term future of Bakewell, which relies on its uniqueness. We don’t want to become like every other cloned high street in the country.” A spokesperson for Costa said the company planned to open the new branch, which would create more local jobs, adding: “We see no reason why a Costa store could not fit (in Bakewell) comfortably - our offering is very different to the local independent coffee shops and bakeries.” Meanwhile, Costa has applied to open a second branch in Chichester. The application is for the building, which is currently occupied by the bank Santander in East Street.

Independent columnist – action still required on M&B share register: Independent columnist Mark Leftly has argued that action is still required to normalise Mitchells & Butlers (M&B) share register. He pointed out that former chairman John Lovering promised action in 2010 to normalise the share register, which is dominated by two large investors. He wrote: “The best part of three years later and Mr Lovering is long gone, investors are still scared off by a register that sees two major shareholders seemingly poised to take M&B out fairly cheaply at any minute. Although it would be understandable if Mr (Joe) Lewis and Elpida do not see the need to clarify their positions again, it’s difficult to understand how M&B can again be a FTSE 100 powerhouse unless Mr Lovering’s two-and-a-half-year pledge to sort out the register is finally met. Investors are simply too worried that the ownership of the group is concentrated in so few hands. It’s about time that M&B’s management picked one final – sorry for the cliché – bar-room brawl to bring this saga to an end.”

Wetherspoon set to open in one of smallest towns so far: JD Wetherspoon will open a £1.2m pub in one of the smallest towns so far – the town of Crook in County Durham has a population of 8,573. Ye Olde Horse Shoe Inn will open at noon on Tuesday, February 12. It will feature a commissioned sculpture to the staircase and a balustrade made up of tools, which would have been used by miners, and crafted by a blacksmith based in the north east. Meanwhile, Wetherspoon has won planning consent to open in Burgess Hill, West Sussex (population: 28,803), where it will convert an empty Curry’s and a building previously occupied by Sussex Stationers.

Spirit converts Witney pub to John Barras brand: Managed company Spirit is to convert Ye Olde Cross Keys pub in Witney to its John Barras brand. The company is to spend £100,000 on the conversion with the pub to re-open on Tuesday, February 12. Spirit plans to refurbish the interior and exterior, bring in new furniture and update the food and drinks offers. New manager Gareth Hunter said: “I’m really excited about the future of the Ye Olde Cross Keys. With this refurbishment the team and I hope to bring back the essence of what a great British pub is all about; great food, a wide selection of drinks and excellent entertainment.”

Cheshire Cat Pubs & Bars acquires fifth site: Cheshire Cat Pubs and Bars, headed by Tim Bird and Mary McLaughlin, has bought The Church Inn at Mobberley, Cheshire, which will be developed with new letting rooms and a larger functions trade. Other sites operated by the company are the Bull’s Head, also in Mobberley; the Three Greyhounds Inn near Holmes Chapel, Cheshire; the Red Lion in Weymouth, Dorset; and The Cholmondeley Arms near Malpas in Cheshire. Bird developed Que Pasa at Eldridge Pope while McLaughlin was formerly managing director of Spanish restaurant chain La Tasca. Kelly Catterall, Christie Finance consultant, who helped arrange the finance, said: “We are delighted to have secured the funding to enable Mary and Tim to acquire their next business venture. The combination of their existing sector knowledge and excellent reputation as established operators, together with our unrivalled sector knowledge and established relationships with lenders, means we have been able to negotiate a competitive facility and introduced a lender who will assist Mary and Tim with their growth plans in the future.”

Enterprise Inns sells Devon freehold to local businessman: Enterprise Inns has sold the freehold of The Kings Head in Cullompton, Devon to local businessman Derek Slack off an asking price of £185,000. Christie + Co director at the Exeter Office Matthew Smith said: “As a result of our extensive marketing campaign, we were able to introduce a number of interested parties before agreeing a deal with Mr Slack. He will be rejuvenating the property and restoring it to a fully operational business and accommodation in the near future.”

First Nobu Hotel opens in Las Vegas: A 181-bedroom Nobu Hotel has opened in Las Vegas. Chef Nobu Matsuhisa opened the hotel at the weekend with investor Robert De Niro. It also feature the world’s largest Nobu restaurant with 327 covers. De Niro told The Las Vegas Sun: “We would get all these invitations to open Nobu restaurants in different hotels in the world. We couldn’t do them all, but it got me thinking why if so many hotels wanted us, why didn’t we just do the hotels ourselves with our restaurants in them. Why let others use our name when we can do it ourselves. It always excited me to have a Nobu Hotel.” More Nobu Hotels will open in Saudi Arabia and Qatar by the end of 2013.

Luminar wins Best Nightclub award in Kingston – for its second site: Luminar’s Hippodrome nightclub in Kingston upon Thames has been crowned the town’s top nightspot for the second consecutive year. The club won the vote of independent adjudicators and assessors from Kingston Council and Kingston First, the town’s business improvement district, as part of the annual Best Bar None Awards. The club’s manager, Ian Hamilton, who has been at the helm of the club for two years, said: “We are obviously thrilled to be voted for the second year as Kingston’s Best Club - it’s a team effort and the award is for our 100 employees who work so hard to deliver a fantastic night out for our customers.” Meanwhile, a second pre-hearing to schedule a date to hear Luminar’s appeal again the revocation of its licence at Oceania in Kingston will be held this Friday (8 February). The Oceania site, the company’s most profitable venue, is still trading pending a court date to hear Luminar’s full appeal against the decision by Kingston Borough Council to revoke the nightclub’s licence in the wake of fatal stabbing in October last year.

Prezzo plans Essex opening: Prezzo has submitted plans to open a new restaurant in Witham, Essex. The proposed site, at 70 Newland Street, used to be a discount store before it closed down. Jane Coleman, deputy town clerk at Witham Town Council, said: “At the moment it’s a run-down building that has been boarded up for months, but they want to put big new windows in the front and do it all up – it’s going to look lovely.”

Brewdog ladies take to the mash tuns: Female members of staff from Scottish brewer and retailer Brewdog have created a new beer for consumption in their estate of bars. Led by employee Charlotte Cook, who was the lead brewer for the day, the female members of staff created a beer that will be limited to 20,000 litres. The new beer, which will be a spicy, fruity beverage, would be available in about six weeks.

Punch seeks partner for £200,000 investment scheme: Punch Taverns is on the hunt for an experienced trading partner to lease the eight-bedroomed Ship Hotel on Harbour Road, Eyemouth, where it is planning a £200,000 investment. Punch plans to redecorate with new wooden flooring, rustic and chunky wood furniture and fittings using a mixture of patterned fabrics, to reflect the nautical theme that runs throughout. Elaine Kennedy, regional operations director for Punch Taverns, said: “Considering its fantastic location, it has the potential to bring tourists and visitors from the surrounding areas to Eyemouth. We want to reposition the hotel so it can offer a bar and facilities for weekdays as well as a destination food venue with a quality food offer and excellent letting rooms. We are looking for someone who has had experience running a food-led business or a small hotel. The ideal licensee will be enthusiastic and share our vision for where we see The Ship Hotel heading.”

Venetian restaurant to open next month: A Venetian-inspired restaurant, Tozi, will open in London next month – it’s the first business opened by former Shoreditch House chef duo Daniele Pampagnin and Maurilio Molteni. The 80-seat restaurant will open on 1 March near to Victoria station. It will offer an authentic menu of cicchetti - Venetian-style small plates – as well as charcuterie and cheese platters, wood oven-cooked mains and sharing dishes.

Signature Pub Group opens Edinburgh site: Signature Pub Group, the Scottish operator led by Garreth Wood, has opened its latest site, The Huxley in Edinburgh’s Rutland Street. Head chef David Haetzman, who also heads up the group’s Kyloe Restaurant & Grill, added: “We have brought together a range of well-prepared dishes that are a little different from the norm, all made using high quality, locally sourced ingredients where possible. Inspired by our forays into the US, our menu boasts a range of gourmet hot dogs and chuck steak burgers, which is what we believe people will enjoy in Edinburgh.”

Ludlow Food Centre expands to tap into local producers: Ludlow Food Centre, one of the largest employers in the south of Shropshire with 81 staff and a base for a variety of local food producers, is expanding to create a new restaurant called Ludlow Kitchen. The new business will increase its covers to 140 from 60. Ben Crouch, restaurant manager at Ludlow Kitchen, said: “The new restaurant will be the place to eat in Shropshire. The new layout will include soft seating, a log burning stove, a sharing table and a garden room. The Food Centre is the ultimate larder to select our produce from. The food is local or made on the premises and we can choose ingredients, cuts of meat, cheese and bread on a daily basis. I am not aware of another restaurant that can claim such provenance across their entire menu.”

Thwaites to reduce head count by 25: North west brewer and retailer Thwaites is set to reduce head-count by 25 staff. Redundancies would come from the brewing and tanking room, packaging, warehousing, planning, engineering and management teams. A total of 83 workers will be involved in the “consultation process” with plans to restructure the business, to leave 58 jobs. The proposed restructure will see Thwaites move from a three and two shift operation to a single, extended 12-hour shift. The brewery said the move is “in response to the loss of a number of packaging contracts and increased customer pressure to reduce costs”. Thwaites chief executive officer Rick Bailey said: “These are incredibly tough times for all businesses, and most companies in our sector and elsewhere are focusing on ways that they can save costs and work more efficiently. Unfortunately this also includes considering job losses, which is the hardest decision to make. It is imperative that we continue to adapt our business to reflect changes in the market and remain competitive whilst not compromising on the quality of the beers that we brew for our customers.”

Return to Archive Click Here to Return to the Archive Listing
Punch Taverns Link
Return to Archive Click Here to Return to the Archive Listing
Propel Premium
We are Beer Banner
Imbibe Banner
Growth Partners - Find out More Banner
Cruzcampo Banner
Wireless Social Banner
Surreal Banner
Hogs Back Banner
Star Pubs Banner
Redcat Banner
HDI Banner
Propel Banner
Hospitality Kicks Banner
HGEM Banner
Access Banner
Christie & Co Banner
CACI Banner
Wireless Social Banner
Airship – Toggle Banner
harri Banner
COREcruitment Banner
Hospitality Rising Banner
Cynergy Bank Banner
John Gaunt Banner
Zonal Banner
harri Banner
Tabology Banner