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Morning Briefing Strap Line
Thu 28th Nov 2013 - BrewDog, Domino's, Frankie & Benny's, Polpo, Starbucks

Story of the Day:

Simon French – M&B figures suggest like-for-like declines of 2.3% outside of the M25: Panmure Gordon leisure analyst Simon French has issued a “Sell” note on Mitchells & Butlers after this week’s full-year results, pointing out the company has seen 60 weeks of flat sales. He said: “M&B reported Full Year results circa 2% ahead of expectations driven by lower than expected interest costs. Margin performance was in line with expectations but current trading remains disappointing with like-for-like sales growth flat despite a significant London presence and a favourable trading backdrop. We estimate circa 25% of sales come from within the M25 where the group reports it is performing in line with Young’s & Fuller’s (circa 7% like-for-like sales growth) so that implies the rest of the UK is seeing like-for-like sales declines of circa 2.3%, led by its value brands. By way of comparison, Marston’s, which has little presence within the M25, has just reported 2.2% like-for-like sales growth. M&B has now reported essentially flat like-for-like sales growth for the last 60 weeks and therefore we find it difficult to share management’s optimism that these can suddenly accelerate to 1.5-2.0% in the current year particularly given trading will be impacted by the FIFA World Cup in June/July 2014 when we estimate like-for-like sales will be circa -5%, negating any impact of what is shaping up to be a strong Christmas and New Year trading period. The resumption of dividend payments appears at least 12 months off and the group’s capital structure remains inefficient. All are solvable problems and M&B is potentially a compelling turnaround story. However, we think consensus is too optimistic and until earnings downgrades cease and there are genuine signs of an improvement in operating performance we think the shares warrant a discount to the peer group.” French increased his Price Target from 310p to 365p, which is below the current share price value (400p).

Industry News:

ALMR National Restaurant Association Study Tour to Chicago 85% full: The Propel and Association of Licensed Multiple Retailers (ALMR) 2014 Chicago Study Tour has had 85% of its places booked after launching on Monday. The trip, sponsored by CPL Training, takes place between Thursday 15 May and Monday 19 May. 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 market overview briefing sessions from US experts. The group is staying at the Hard Rock Hotel in Chicago. 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 get more information or to book, e-mail

Tennent Caledonian launches Help for Heroes charity beer: Help for Heroes has joined forces with the historic Tennent Caledonian brewery for the launch of an official new beer for the charity – which aims to raise £500,000 to support the UK’s wounded servicemen and women. Beer drinkers are being urged to make a difference this Christmas and throughout 2014 by picking up packs of Help for Heroes endorsed Tennent’s Original Export. Over the next year, every penny of Tennent’s profit from this charity edition of the beer will go directly to Help for Heroes. Paul Bartlett, C&C Group corporate affairs director, added: “Having spent some time with the Help for Heroes team and the wounded they support, it’s clear to me that every penny raised really does make a difference in providing the lifelong support that they and their families need.” Help for Heroes endorsed Tennent’s Original Export is available at UK Asda stores priced at £8 per 12x300ml pack. At least 50p from the sale price of each pack will be contributed to Help for Heroes. Tennent Caledonian is looking to distribute the beer in the on-trade and any company that wants to stock it should contact their Tennent Caledonian representative.

Cameron pledges support for Indian restaurants: Prime Minister David Cameron has offered his support to Indian restaurants in the UK in the recruitment of skilled chefs from Asia. Speaking at the annual British Curry Awards in London this week, Cameron said: “From the bottom of my heart, let me say thank you for everything you give to our country. I wish this Great British industry every possible success in the years to come. Like any industry this one faces its own specific challenges and I know that there have been questions on immigration and getting chefs with the necessary experience. So let me promise you this – we will work through this together. We’ll continue to help you get the skilled Asian chefs you need.” The event saw a “Special Recognition Award” given to Mohammed Aslam, of the Aagrah Group.

Company News:

Adrian Fawcett becomes chairman of Liberis: Former Punch Taverns chief operating officer and Realpubs chairman Adrian Fawcett has become chairman of Liberis, the UK’s leading Cash Advance provider. Fawcett told Propel: “Liberis has more than 50% of its customers in the hospitality sector and has advanced more than £60m of funds in total. We are looking at how we can seriously scale up the participation across the UK pub and restaurant sector as one requiring significant funding support. The benefits of a Cash Advance by Liberis are: there are no fees or interest rates payable and you get told your repayment amount up front and this does not alter with time. Payments are made by taking a small percentage of future credit and debit card receipts so the actual amount repaid directly relates to how business is doing. Importantly, therefore, if business is challenging the payments drop directly - and it just takes longer to repay the outstanding sum – the effective APR therefore lowers for businesses that are having a tough time not increases. With a 90% application acceptance rate, unsecured funding and a 75% re-use rate the last 2,000 customers have all reported very high customer satisfaction – and it is available on top of existing facilities and without restriction on what the funds are to be used for. We are not just growth business funders – but working capital and support seasonal trade and capital project requirements.”

BrewDog opens third London bar this Saturday: Scottish brewer and retailer BrewDog will open its third London site, in Shepherd’s Bush, this Saturday (30 November). The company stated: “We are hosting an Equity for Punks shareholder exclusive pre-opening party on Friday 29 November, an opportunity for some of the folks who made this venture happen to see their money hard at work. Shareholders helped to directly fund this bar, and this event is a major benefit for them in that they are provided with the first official glimpse of our new bricks and mortar, complete with a tasting session with co-founder Martin Dickie. We are hunting high and low for awesome new venues in places such as Norwich, Cambridge, Brighton, Liverpool, Oxford, Cardiff and Dundee. Boasting 40 taps Shepherd’s Bush is our biggest and boldest venture yet.”

Belfast businessmen open restaurant – and will give all profits to charity: Belfast businessman Lord Diljit Rana and restaurateur Raymond McArdle have joined up to open The Malt Room Bar & Restaurant on the city’s Great Victoria Street – and all profits will be given to charity. The Malt Room plans to provide a refined dining experience with a modern and local twist. McArdle said: “I didn’t want to go down the road of being another bistro or brassiere because the market is already saturated with great offers at that level. At the Malt Room you’re going to get Irish-influenced food that’s still bespoke and littered with artisan producers.” McArdle is an ambassador for Barnardo’s Northern Ireland and has been supporting young chefs from Barnardo’s Dr B’s Kitchen for a number of years, offering trainee placements in his kitchens. At the Malt Room they have already taken on three young chefs through the scheme. Diljit Rana was awarded an MBE in 1996 for his contribution to the economic regeneration of Belfast through the development of hotels, restaurants, fashion shops and modern office accommodation. He came to Belfast in 1966 in search of business opportunities. His first enterprise was a restaurant in Belfast city centre. The business has grown to be one of Northern Ireland’s biggest hotel chains. Andras House, which now employs over 350 people, also has extensive commercial property in Belfast.

Stonegate sets date for re-opening of Living Room site as Missoula: Stonegate Pub Company will re-open a former Living Room site at The Hub in Milton Keynes as a Missoula on Thursday 5 December. The redesigned Milton Keynes venue will include a brand new food menu, a bar upstairs as well as expanded floor space. Earlier this month, Stonegate re-opened a Living Room site at Tower Bridge in St Katherine Dock as a Slug & Lettuce after a £370,000 refurbishment.

Berwick petition calls for PizzaExpress to open in the town: A petition has been started by residents in Berwick (population: 11,665) calling for a PizzaExpress to open a restaurant in the town. “We feel there is an opportunity to strengthen Berwick’s tourism appeal, night time economy and food offer and also create some jobs,” said the community trust’s Julien Lake. “We don’t want to compromise existing businesses but we see a gap in the market for a mid market, family orientated offer. We believe that while a town full of national chains wouldn’t be ideal, there is value in outlets visitors recognise, feel comfortable with and understand the price positioning of.” From market research carried out in 2011, PizzaExpress owner Gondala felt Berwick was not a priority destination for them. But the company has agreed that if Berwick could demonstrate real demand, it would have another look at the town.

JD Wetherspoon lined up for historic Ramsgate pavilion: JD Wetherspoon is lined up to take over the dilapidated 20,000 square feet Royal Victoria Pavilion in Ramsgate (population: 39,639), one of the most “at risk” Victorian buildings in the country but closed since 2008. “It is a splendid building,” said Chris Costelloe, director of the Victorian Society, which has placed it in its top ten endangered list of Victorian and Edwardian buildings. Thanet district council this week issued a 1,000-word statement that indicates that Rank, the leaseholders, has had 40 expressions of interest since 2008 but only one party, JD Wetherspoon, has both shown an interest in proceeding and satisfied Rank. “Legally, Thanet district council has no right as landlord to market the lease and Rank as tenant has recently made clear to the council that it has no current plans to give up the lease other than in favour of JD Wetherspoon,” the council said in its statement. The council said Wetherspoon would restore the building and sub-let a third of it.

Jongleurs operator Momo Leisure leaves £598,917 creditor deficiency: Jongleurs operator Momo Leisure left a creditor deficiency of £598,017 when it was placed in voluntary liquidation last month. Trade creditors are owed £170,445, including a debt of £32,000 to Marston’s, while directors are owed around £300,000 of the sum. Momo Leisure ran five comedy clubs but went into administration after losing two sites that it sub-leased from operators that have gone under. It ran sites in Birmingham, London and Bristol independently, as well as nights in Nottingham and Cardiff alongside the nightclub owner Luminar.

Oakman Inns and Restaurants – three major projects planned for 2014: Oakman Inns and Restaurants, the award-wining company led by Peter Borg-Neal, has three major projects lined up for 2014 after opening the flagship Crown & Thistle in Abingdon yesterday after a £1.8 refurbishment of a site originally acquired for £1.4m. Borg-Neal said: “This was the biggest task we have undertaken to date and we have re-opened and restored a beautiful building, which will I hope become a cherished part of Abingdon’s history and attract visitors from all over the UK. We have three major projects planned for 2014 – again based around the Home Counties.”

Restaurant Group to open three Frankie & Benny’s in December: The Restaurant Group is opening three Frankie & Benny’s in December – the new openings will be in Leicester’s Highcross shopping centre, Coventry Arena and Milton Keynes’ Kingston Centre. This month, the brand opened in Mansfield, Gateshead, Ipswich plus the London Designer Outlet. The new openings in December will push the brand through the 225-site mark – the Wembley opening was the 223rd store.

Cabana to open fifth site in Islington: Award-winning Brazilian barbecue restaurant Cabana, headed by Jamie Barber and David Ponte, will open its fifth site, this time in Upper Street in Islington tomorrow (30 November). Other Cabana sites are located in Wembley Designer Outlet, Westfield White City, Westfield Stratford and Covent Garden.

Polpo founder to open first pub today: Polpo founder Russell Norman will open his first pub in London’s Cambridge Circus today. Writing in The Telegraph, Norman said: “The Ape & Bird Public House, will have four bars and two dining rooms over three floors, with 120 dining seats plus 100 drinking seats and will be open 13 hours a day, seven days a week. In the UK currently there are 27 pubs going out of business every week. There is massive competition from the super-slick chains, backed by very efficient corporate infrastructures. Publicans are constantly having to up the ante and offer fantastic value – and added value; it is a very competitive market and pubs, as businesses, are harder than ever to make work. Please, don’t do it. So why am I? Well, I’ve always fancied having my own pub.”

Alan Murchison Restaurants voluntarily wound up: The company owned by chef Alan Murchison that operated the Michelin-starred L’Ortolan restaurant has been put into liquidation. Alan Murchison Restaurants Ltd was voluntarily wound up earlier this month leaving more than 50 creditors owed a total of £447,209. Peter Newman, who has owned L’Ortolan, in Shinfield, since 2000 has taken over the running of the restaurant with Murchison remaining as head chef. He said: “It means we have a head chef who is focusing entirely on L’Ortolan in Reading.”

Domino’s launches online hub to boost organic search: Domino’s has launched an online hub it hopes will push its organic search results ahead of rivals. The pizza chain has created a consumer blog to house all its branded content including posts, widgets, downloads, competitions, infographics, videos and pictures. The hub, developed by Arena Media, will also allow fans to post comments and share content via its live Instagram and Twitter feeds. Visitors will also be able to visit a vouchers page where they can access the latest online deals. Domino’s hopes the platform, which is hosted on a sub-domain so it does not interfere with the ecommerce site, can increase the number of search terms will be found under. Nick Dutch, head of digital at Domino’s Pizza, said: “As a brand that has built up a huge social media presence, we’ve seen a lot of success with online content projects in the past – and they work hand-in-hand with online ordering. Hosting all content on one destination was a natural next step. We know the value in bringing fresh and interesting content to our audience and the blog will be easy and quick to update, and will allow for all-important customer feedback.”

Red Hot World Buffet flagship site reports 6,000 Christmas bookings: The flagship Red Hot World Buffet site, The Cornerhouse in Nottingham, has reported 6,000 Christmas bookings. A new management team has also been recruited to run this site – general manager Luis Wilson-Wolfe and Charlie Truman who will head up the sites marketing and social media.

Sermon adds US Vapiano role: Vapiano UK managing director Phil Sermon has been appointed as chief executive officer of Vapiano in the US. Sermon joined Vapiano in 2012 and is responsible for its two London restaurants and future expansion across the UK. In his new role he will oversee the Vapiano restaurants in the US while continuing his work with Vapiano in England. Before joining Vapiano Sermon had worked for a number of leading hospitality companies in the UK, including pub operator JD Wetherspoon, Hilton Hotels and contract caterers Sodexo. Sermon said: “I am delighted to have been appointed as CEO for Vapiano in the USA and look forward to the challenges ahead and ensuring the restaurants are successful.”

YO! Sushi whips covers off new menu: YO! Sushi has rolled out a new menu with 12 fresh dishes on in all its outlets. The new dishes are: Chicken kara age; deep fried chicken marinated in sake and soy, ginger, garlic; tuna tataki and ponzu; pepper-seared Yellowfin tuna, chilli daikon, crispy shallots, ponzu; goma salad (V); salad leaves, cucumber, cherry tomatoes, crispy shallots, sesame peanut sauce; inari and chive futomaki (V); sweet soy bean curd, chives; beef tsukune; skewered beef, cucumber and spring onion sausages, teriyaki sauce; salmon harumaki; salmon and nori spring roll, misotchup; chicken yakitori: grilled chicken thigh on skewers, sweet and sticky soy sauce; salmon and yuzu salsa sashimi; salmon, cucumber and cherry tomato salsa, ponzu (five slices); popcorn shrimp tempura; shrimps glazed with creamy miso sauce; duck and hoisin salad; hoisin marinated duck, salad leaves, cucumber, spring onion, white sesame; banana and chocolate harumaki (V); hot banana and chocolate spring roll, raspberry sauce; chocolate Dorayaki (V); Japanese pancake, chocolate ganache filling, raspberry sauce. In total the chain has 30 hot dishes, 37 sushi dishes and six salads to choose from.

Cardiff nightclub fined £12,000 over noise complaints: The owner of Floyds Bar in Cardiff has been fined £12,000 and ordered to pay £10,186 in costs after failing to comply with noise abatement notices. Cardiff Council prosecuted Kelvin Evans due to continual complaints from tenants living in an adjacent property – described by one in court as ‘blighting her life’. The court heard that on many occasions, Cardiff Council tried to engage with Evans and his staff and gave recommendations on how the level of noise could be reduced through installing air conditioning, removing the speakers off the wall and creating a false ceiling. But the court heard the problems continued and equipment was eventually seized but the club then rented out new equipment and continued ‘business as usual’.

New Bristol restaurant combines steak and art: A new restaurant, Steak of the Art, has opened on Bristol’s Harbourside, combining a steakhouse offer and adjacent art gallery. Owner Steve Bowen said: “The art gallery is separate to the restaurant area so people can come in and look around the paintings, which are all for sale. This first exhibition was just to get us up and running and we have deliberately combined styles and artists so that it is a thought-provoking and exciting mix. We plan to showcase individual artists, genres and showcase local talent in the future.”

TQ Hotels buys Burton hotel: TQ Hotels has taken ownership of the 62 bedroom Three Queens Hotel, which is located on Bridge Street in Burton town centre. The sale of the hotel, off an asking price of £995,000, was brokered by specialist property adviser Christie + Co on behalf of Baker Tilly.

Starbucks to embark on Fourquare trial: Starbucks is taking part in a pilot scheme with mobile check-in service Foursquare trialing advert formats that let the coffee shop chain target users near its outlets via the app. The UK pilot will see the new display ad format – called a Promoted Update – served to Foursquare users when they check-in to locations within a specified distance of Starbucks outlets. Hotelier chain IHG Hotels has also signed up to the pilot scheme, which is scheduled to kick off before mid-December.

Multi-siter wins Adnams Pub of the Year award: The Harbour Inn at Southwold has been named Pub of the Year in the annual Adnams Pub Awards. Nick Attfield, the landlord at The Harbour, who also runs The Bell in nearby Walberswick, was presented with the award during a ceremony held at Adnams’ Swan Hotel in Southwold. The Harbour Inn was hailed as “a great example of the perfect Adnams pub”, offering a warm welcome, excellent beer and good quality locally-sourced food.

Beannchor Group opens £1.25m Dirty Onion and Yard Bird complex: The Beannchor Group has opened a £1.25 million four storey listed building on Belfast’s Hill Street and that will feature The Dirty Onion, a bar and live music venue, and Yard Bird, an upstairs free-range rotisserie chicken restaurant. The Dirty Onion is described by the Beannchor Group as “a modern take on a traditional Irish pub”. Bill Wolsey, managing director of Beannchor, said: “The opening of The Dirty Onion and Yard Bird this week follows years of work behind the scenes to breathe new life into one of Belfast’s most beautiful buildings. We want to offer an alternative to the modern music venues in Belfast city centre – somewhere that people come not only to be entertained but to get involved and be part of creating the atmosphere.” Earlier this month, the Beannchor Group – which owns over 50 pubs, hotels and restaurants including Belfast’s only five star hotel, The Merchant – opened the high-end artisan bakery, Patisserie Mimi and also its neighbour, The National Grande Café Bar in September.

Enterprise Inns to invest six-figure sum in Gloucester rugby pub: Enterprise Inns is to invest a six-figure sum in one of Gloucester’s oldest pubs, Northend Vaults in Northgate Street. It is hoped the regeneration will encourage more business into the area ahead of the Rugby World Cup in 2015. At just a short walk from Kingsholm, a re-invigorated Vaults, will be in prime location to serve match day visitors to watch rugby in the city. The search is now under way by Enterprise to find a suitable landlord. Simon Wilson, regional manager for Enterprise Inns, said: “We are extremely excited to be moving forward with this project.”

Pizza Hut declines to sell up to allow retail park development: Multi-million pound plans to extend a retail park hang in the balance amid a row between landowners and Pizza Hut. The company is refusing to leave its restaurant in Solent Road, Havant – scuppering a developer’s bid to transform the area with a two-storey retail unit, 250 parking spaces and potentially create 130 jobs. Havant Borough Council has now received a request to use compulsory purchase powers to demolish Pizza Hut’s building, which was built in the last decade. A spokeswoman for Pizza Hut Restaurants said: “Pizza Hut Restaurants was approached by the landlord of the property on Solent Road earlier this year with a request to buy, however this request was declined. We intend to continue operating from this restaurant and have no plans to sell the property.”

New 800,000 square feet Oxford retail development scheduled for 2017: The Westgate Alliance, a joint venture between Land Securities and The Crown Estate, will open a 800,000 sq ft (74,300 sq m) city centre retail development in autumn 2017. The new Westgate centre will feature more than 100 new retailers and restaurateurs, a premium boutique cinema and a roof-top dining venue. The new Westgate will also hold what will be the city’s largest car park with up to 1,000 spaces, servicing the needs of the 40 million people who visit Oxford every year. CBRE and DTZ are appointed to support the Alliance as joint retail leasing agents. Davis Coffer Lyons is appointed as food and beverage leasing agent.

Lake Opportunities buys Oakley Court Hotel: Lake Opportunities has bought the Oakley Court Hotel following the appointment of John Hansen and Stuart Irwin of KPMG as Joint Administrators. A spokesman for agent Collier International said: “As anticipated an overwhelming amount of interest was generated as a consequence of a structured process and after a considerable number of offers, a single party was provided with “preferred bidder” status.” The selling price is undisclosed.

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