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Fri 2nd Mar 2018 - Revolution reports LfLs up over festive period, down early 2018, Just Eat’s new chairman
Revolution Bars Group reports ‘underlying’ like-for-like sales growth of 1.9% in first 26 weeks, like-for-likes down in early 2018, management team changes: Revolution Bars Group, the operator of 72 premium bars, trading under the Revolution and Revolución de Cuba brands, has reported sales were £73.8m (FY17: £66.7m) with like-for-like sales up +0.4%in the 26 weeks to 30 December 2017. The company stated: “The reporting period comparison was distorted by the absence of New Year’s Eve, one of the most significant trading days in the current period, whereas it was the last day of the comparative period. By extending the reporting period by one week (27 weeks) to include New Year’s Eve increases like-for-like sales growth to 1.9%, a more meaningful comparable presentation of the group’s first half underlying performance can be made. The incremental sales and profit benefit from New Year’s Eve on 31 December 2016 was £1.0m and £0.5m respectively. Four new sites were opened during the period. A Revolución de Cuba was opened in Belfast in July, achieving the highest level of sales over its first 24 weeks of all venues which have opened in the last two years and the third highest of all the group’s venues in December. Three new Revolution bars also opened just before Christmas in Solihull, Inverness and Putney with each surpassing their initial sales targets. Currently, the group trades from 58 Revolution and 14 Revolución de Cuba venues. With a further Revolución de Cuba opening towards the end of March 2018 in Birmingham and another Revolución de Cuba expected to open in Newcastle-upon-Tyne just before the end of the financial year, our opening programme is on track to meet the planned six new sites in the financial year, taking the estate footprint to 74 venues. A further three new sites are expected to open early in the new financial year with the pipeline for further sites remaining strong. The board is confident in the strength of the group’s brands and its ability to operate and grow, particularly given the scale and strength of its pipeline of new venues and the strong returns achieved from new openings within the last two years. The board believes that, given its clear and focused strategy, the quality of Revolution’s sites and customer proposition, and the talent within the business, it is well placed for further growth. That talent will be further enhanced when Rob Pitcher, our new chief executive joins the business, bringing significant sector experience and insight and a personal determination to drive the next phase of growth.” Keith Edelman, executive chairman, said: “I am delighted with our sales performance in the second quarter and over the Christmas period which shows the clear underlying strength of our business and continues to demonstrate the appeal and potential of our brands. New openings are performing particularly strongly, and site refurbishments are delivering healthy returns, meaning the group can pursue its strategy of profitable growth and drive like-for-like sales in its core estate. The business is well set for the arrival of Rob Pitcher in the coming months.” He added: “Jimmy del Giudice, chief operating officer, left the business in January. This allowed the senior operator of the Revolution and Revolución de Cuba brands to step up to the senior management team. At the same time, responsibility for Marketing, which previously reported to the chief operating officer, has been realigned to Kate Eastwood, who is now responsible for both sales and marketing. Food remains a significant growth opportunity particularly across its day time and early evening business and therefore we recruited Simon Dobson as food director in January. Simon was previously managing director of Delaware North and achieved much success in growing and operating very large restaurant businesses. His initial focus will be to revitalise the food offer in the Revolution bars, improving its quality, delivery and service standards and aiming to ensure that customers rate Revolution food as highly as its cocktails. In common with other operators, like-for-like sales since the start of 2018 have been slower than previous years. In the eight weeks to 24 February, like-for-like sales were up 3.8%, but in the seven week period to exclude New Year’s Eve, like-for-like sales were down 2.0%. Wet sales have generally held up well, particularly at weekends and we have resisted the temptation to aggressively discount as we do not believe that this is in the best long term interests for our premium bars. Food sales have been impacted. January and February is always the quietest time of year for our business and we have observed a long term trend to a later but stronger Christmas trading period being followed by a bigger trough in sales during January. We believe that like-for-like sales reduction is temporary and that growth will return as footfall naturally improves as customers recover from the Christmas period, with the better weather and in particular the bank holiday weekends when the business traditionally see stronger sales.” Operating loss for the 26 week period was £3.7m. Profit performance has decreased due to significant exceptional charges of £9.6m principally associated with (i) the costs incurred in managing the corporate activity, (ii) making provision for onerous lease costs on venues where rental costs exceed the bar contribution, (iii) asset impairment charges, and (iv) the change of chief executive.

Hop Stuff invests in two fellow craft brewers: Hop Stuff Brewery has made an A share investment into both Northern Monk Brew Co and Left Hand Giant Brewing Company, signalling a substantial investment in the two fellow craft brewers. Hop Stuff managing director James Yeomans told Propel: “The Hop Stuff ethos is focussed on the promotion of craft beer. What better way to show our intent than to invest is two of the UK’s best up-and-coming brewers? Both brewers are pioneers in their field, advancing the world of craft beer in two parts of the UK that Hop Stuff currently can’t supply. We were keen to support them with an equity investment and grow our industry together.” Hop Stuff recently completed its own crowdfunding campaign rising over £750,000 in January of this year. The group has revealed that it is actively looking to invest in other brewers they believe carry the same ambitions for the future of UK craft beer, making beer accessible to more people than ever before. 

Just Eat hires Mike Evans as non-executive chairman: Just Eat, the global marketplace for takeaway food delivery, has appointed Mike Evans to the role of non-executive chairman, with effect from 26 April 2018. Since 2014, he has been non-executive chairman of ZPG, the operator of digital property brands. He also serves as the senior independent director of Chesnara. He was previously non-executive chairman of Hargreaves Lansdown from December 2009 to February 2018 and a non-executive director of esure from June 2013 to August 2015. Evans is an experienced director with significant experience acting as chairman of rapidly growing, digitally focussed businesses. He spent much of his career in the financial services industry, where he accumulated more than 30 years’ experience and held several senior executive positions, including as chief operating officer of Skandia UK Limited. He will join the board of Just Eat as an independent non-executive director and chairman elect on 6 March 2018. His appointment as non-executive chairman will be effective from the conclusion of the company’s Annual General Meeting on 26 April 2018. Separately, Just Eat also announces that David Buttress will retire from the board as a non-executive director at the conclusion of the company’s AGM on 26 April 2018. Andrew Griffith, Interim non-executive chairman, said: “I am delighted to welcome Mike to the board of Just Eat, where his proven expertise as a FTSE 100 chairman, and experience of online marketplaces, will be immensely valuable. He joins at an important time for the business, as it seeks to extend its UK and international leadership in fast growing markets. I would also like to thank David Buttress for his contribution to Just Eat over many years, including as chief executive and latterly as a non-executive director.” Mike Evans said: “Just Eat is an outstanding company in an immensely exciting market, with a great brand and a strong track record of profitable growth. It is a privilege to chair such a dynamic business, and I look forward to using my experience to help the board and leadership team maintain strong growth and governance over the coming years. I would also like to pay tribute to Andrew Griffith who, as interim chairman, has provided much-needed stability to the board and the company through a year of exceptional change.”

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