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Tue 13th Mar 2018 - Propel Tuesday News Briefing

Story of the Day:

Deliveroo launches street food startup service: Deliveroo has launched an initiative that focuses on street food startups. Named “Pop-ups”, the initiative will give street food brands 12-week slots at Deliveroo Editions sites, with the chance to become a permanent partner. Four brands will initially feature at Deliveroo’s Canary Wharf Editions site with their menus available on Deliveroo for 12 weeks. The brands are SpiceBox, Vegan Matcha Burger Bar, Kabab, and SuBuSake. Camden-based SpiceBox is the brainchild of vegan entrepreneur Grace Regan and was described as “life-changing curry” by Time Out. Vegan Matcha Burger Bar was founded by a Michelin-trained chef and personal trainer. It offers vegan-only matcha burgers that are healthy and bright green. Kabab, founded by Phil Hinitt, offers gourmet Mediterranean kebabs from a food stall in Shoreditch using free-range, organic meat. SuBuSake is a premium Japanese fusion concept –SuBus are jars with layers of sushi rice, fresh sashimi, vegetables, toppings and sauce. Two of the four brands are vegan to recognise the “growing demand for quality vegan food across London”. The programme will be rolled out across Editions sites around the country, with the most popular brands being given the chance to become full-time Editions partners. Deliveroo founder and chief executive Will Shu said: “Our aim behind Pop-ups is simple, allow our customers to get amazing street food delivered. It’s awesome that through Editions we will be able to bring people great new choices while helping new brands take the next step in their food journey. Starting a business is tough but Deliveroo will be able to help these talented new chefs showcase great food over the 12 weeks they are with this, and hopefully allow some of these fantastic brands become regular features on our Editions range.”

Industry News:

Social Media Strategy In A Day opens for bookings: Social Media Strategy In A Day, an event aimed at allowing companies to develop and hone their social media strategy, has been launched – and is open for bookings. The event features all-new content and insights to allow companies to increase brand exposure and broaden their reach. Propel has partnered with digital marketing company Digital Blonde for the one-day advanced workshop that will cover everything a marketing department should be thinking about when it comes to social strategy. The event, which takes place on Thursday, 26 April at One Moorgate Place in London, will open with Digital Blonde founder Karen Fewell revealing updates from recent industry reports and analysing insightful statistics. Attendees will be among the first to hear what she took away from the SXSW conference in the US. You will also learn the “top ten principles of persuasion for hospitality businesses”, which will show you how to apply psychological principles to help people buy your products and services. Craig Hill will help you unearth your brand character and show you how to tell others about it in an interesting and engaging way. During the “inspiration session”, you will look at ten killer social media campaigns – what worked and why are people talking about them. The “interactive guide to content brainstorming” will force you to look at a campaign in a more emotional and engaging way, while the Digital Blonde team will also look at the changes Facebook made to its algorithm earlier this year and reveal what it means for your social account. The “understanding user behaviour” section of the event will answer key questions such as how do you engage with millennials and do Gen Z even use Facebook any more? Fewell will round up the morning session by sharing the latest updates on the incoming General Data Protection Regulation. The afternoon will start with a quick-fire round of 20 questions in 20 minutes, while Jamie Riddell, of pay-as-you-go analytics platform BirdSong Data, will reveal useful things about user behaviour in the hospitality sector. The “ultimate content toolkit” talk will reveal the tools you need to create engaging content cost-effectively from your mobile phone. Social copywriter Nicola Proud will share her top copywriting hints and tips and reveal how to write Facebook, Instagram and Twitter posts that stop people scrolling. The event will also reveal how to use Instagram stories to drive revenue for your business and show the key differences between the social advertising platforms on Facebook, Instagram, Twitter and LinkedIn. Finally, the team will tell you where to find influential people, what to pay them and how to successfully build them into your strategy. Tickets are £295 plus VAT for Propel Premium members and £345 plus VAT for non-members and can be booked by emailing

All Our Bars chief – crazy business rates system is unfit for purpose: All Our Bars chief executive Paul Wigham has branded the “crazy” business rates system as “unfit for purpose”. His comments come as a letter was sent by restaurant bosses to chancellor Philip Hammond asking for “root and branch” reform of business rates. Wigham said: “This issue needs to be exploded, not pleaded! Government were warned about this by all the trade bodies in hospitality and retail yet, in spite of the press coverage, did nothing to address the pressure.” Reeling off a list of high-profile casualties in the hospitality and retail sectors, he branded business rates as being at a “crazy level in a system unfit for purpose”. He added: “At Bluewater on Sunday I counted 15 empty units in the main malls. In Palmers Green on Tuesday there were five dead units in 60 yards including Starbucks & Multi York. The affluent London area is now dead after 9.30pm.” Wigham also hit out at the Apprenticeship Levy and pension contributions while lamenting “crazy unsustainable rent deals in many areas with reviews from 2012/13 agreements taking effect”. Wigham said the impact of this perfect storm would be fewer jobs for younger or part-time workers, dead high streets with no regeneration, and online retailers getting stronger and pressuring physical retailers’ margins. Regarding a solution, he told the government: “Stop politicising tax and do it properly – sort the system out and make it fair in all taxes. All governments hide from personal tax issues for fear of losing votes but there will be nothing to vote for at this rate.”

London hotel market sees increase in supply and demand figures in February: The London hotel market saw a 2.2% year-on-year rise in supply and a 1.8% increase in demand during February. The average daily rate also increased year-on-year for a 16th consecutive month – by 1.2% to £133.84 – despite the “Brexit boost” continuing to dissipate. Revpar also rose, by 0.8% to £103.48, but occupancy levels dipped slightly, by 0.4% to 77.3%, for a ninth month in a row. The figures follow a record-breaking performance by UK hotels during January, which saw the highest ever numbers for the month in STR’s database. However, STR analysts noted the surge in domestic and international tourism following the Brexit vote pushed occupancy and average daily rates to peak levels in 2017. As that impact continued to fade, STR said, so would the potential for year-on-year growth in comparison to previously high performance values. 

B&B Association chairman calls on MPs to support new national event: Bed & Breakfast Association chairman David Weston has called on MPs and the sector to add their support to National B&B Day. The event will make its debut on Saturday, 24 March and news is being spread across social media via the hashtag #BandBday. The UK’s bed and breakfast sector is worth £2bn a year. Weston said: “National B&B Day is an overdue annual celebration dedicated to all the committed, passionate and hard-working people who help make a British holiday or break the wonderful experience it is. This week I am writing personally to all constituency MPs to invite them to signal their support for the small local accommodation providers that play a key role in their local economies.” Anthony Pickles, head of tourism affairs at VisitEngland, added: “The British bed and breakfast is one of the fundamentals of what makes a visit to Britain great for overseas visitors.” Bed and breakfasts have experienced a renaissance in the past decade and Weston said new technology and online bookings were enabling B&Bs to compete with larger rivals.

Company News:

Anglian Country Inns acquires ninth site as it brings Knebworth pub back in the family: Anglian Country Inns, the award-winning operator of gastro-pubs and restaurants led by James Nye, has acquired its ninth site. The company has added The Lytton Arms in Knebworth, Hertfordshire, to its estate. The free-of-tie pub overlooks the Knebworth Park estate and the Nye family has strong ties with the venue – James’ uncle, Steve Nye, built a reputation for real ale while running the site in the 1990s. The pub, which had been closed, is being restored and will reopen with a focus on the quality and range of beer. James Nye said: “When we heard about the opportunity of The Lytton Arms, it was very hard not to be excited. I had my first job scrubbing dishes in the kitchen and it is a pub very close to our family. While wet-led pubs may have been struggling during recent years, we feel there is a great opportunity to make the most of the free-of-tie position to curate an exciting collection of real ale, craft beer and cider, alongside an authentic food offer. We are excited to be writing the next chapter for The Lytton Arms and look forward to serving the local community. This sort of pub is very much part of our ethos and we see it as a great opportunity to further expand our existing successful portfolio.”

Bannatyne Group reports 57% surge in profits as investment programme pushes turnover to £117.6m: Bannatyne Group, led by Duncan Bannatyne, has reported a record year during which pre-tax profits surged by more than 50%. The company’s portfolio comprises 71 gyms, 46 spas and four hotels. A two-year investment programme pushed turnover to £117.6m in the 12 months to 31 December 2017, up from £112.2m the previous year, while pre-tax profit climbed 57% to £14.3m. Bannatyne Group acquired four sites during the period, including its first in Northern Ireland, and spent £14m modernising its estate. Nine spas also opened, with spa revenues up 13% to £16.5m. Over the past two years, Bannatyne Group has invested more than £28m in its estate, with 99% of its gyms now refurbished. Chairman Alan Jackson said: “Strategically, the company has carved out its own sub-sector playing to today’s trends. The results for 2017 are testimony to the company’s ability to deliver a truly excellent and modern proposition to its members.” Chief executive Justin Musgrove added: “We are delighted with the 2017 results – 57% increase in profits year-on-year after a 15% uplift in 2016 and very strong cash generation is clear demonstration that our strategy is delivering and the investment over the past two years is driving strong returns. Our aspirational proposition with investment in state-of-the-art gyms, treatment spas and technological developments is robust, differentiated and sustainable.”

PizzaExpress reveals plans for five further restaurants in 2018 as it achieves Superbrands status for first time: PizzaExpress has revealed it plans to open a further five restaurants in 2018 as it was awarded Consumer Superbrands status for the first time. Voted for by 2,500 members of the British public and ratified by a voluntary council of senior independent industry experts, PizzaExpress, which opened its 600th restaurant last year, climbed 176 places in this year’s ranking. The process, managed by The Centre for Brand Analysis (TCBA) in partnership with Research Now SSI, saw more than 1,500 brands from 78 categories judged against the three core criteria of a “superbrand” – quality, reliability and distinction. PizzaExpress managing director Zoe Bowley said: “We are so proud to be awarded Superbrand status. PizzaExpress has been a firm favourite of the nation since 1965 and is synonymous with good pizza and good times for generations of families. It’s important to us that we continue to listen to our customers and understand the needs and wants of future generations to ensure we remain a much-loved brand.” TCBA chief executive and Superbrands chairman Stephen Cheliotis added: “Being highly thought of is important for brands in any market but in highly competitive markets it’s essential. Achieving Superbrands status is recognition PizzaExpress remains a leading brand in the UK. Such strong performance illustrates the continued success of the brand and is a positive endorsement of its future in a challenging market.”

Frontier Pubs opens seventh site: Frontier Pubs, the partnership between Ei Managed Investments and pub operator Food & Fuel, has opened its seventh site, the Victoria Tavern in north London. The site in Holloway Road was previously called Liquor Works and is close to Arsenal FC’s Emirates Stadium. Following a significant investment, the two-storey site has been refurbished and boasts the same offer as the other Frontier pubs, with an extensive range of craft beer accompanied by handmade pizza served from an open-plan pizza oven. Sports are a prominent focus at the venue, with a number of screens showing big events. In a first for Frontier Pubs, the bar includes a arcade area on its first floor including table football, Plonk Golf and arcade machines. Food & Fuel commercial director Peter Myers said: “We’re very excited to open this latest site, which is the perfect location for us with our strong focus on sport and quality beer. Getting the best out of each site is something we work very hard on and we feel the arcade bar will create a real point of difference in the area and generate an additional pull when it’s not match day.” The pub will debut Frontier Pubs’ first own-label beer – brewed in collaboration with Harbour Brewing Company. The draught beer is a 4% unfiltered pilsner called Riptide that will be rolled out across the Frontier estate and Food & Fuel pubs this month. Ei Managed Investments operations director Nathan Wall added: “Peter and his team know how to put together a great offer and get the best out of a pub. We’re delighted with how the pubs across the Frontier portfolio are trading and are confident this latest opening will be equally successful.” Ei Group currently has nine Ei Managed Investment partnerships in operation.

Public Urban Bars opens fourth Star site, second for CookHouse brand: North west-based operator Public Urban Bars has opened its fourth Star Pubs & Bars site and seventh in total. The £840,000 refurbishment has seen the English Rose in Liverpool reopen after an 18-month closure. The site has been transformed into Public Urban Bars’ CookHouse Pub & Carvery brand, building on its site in Prestatyn that opened in May 2015, with the company keen to roll out the concept further. The reopening has created 45 jobs, while the rear garden has been landscaped with new areas for alfresco eating and drinking, an enclosed children’s play area and seating for more than 100 customers. A kitchen has also been installed as well as an ice cream parlour, a carvery with rotisserie, and a coffee bar. Public Urban Bars managing director Colin Stuart said: “Our aim is to keep prices reasonable without reducing quality and to exceed customer expectations in everything we provide. We believe it’s a gap in the market in the family sector. Partnering with Star works well for us. Its commitment to bold investment allows us to unlock the maximum potential from previously underperforming sites.”

Yard Sale Pizza launches Leytonstone restaurant for fourth London site: Yard Sale Pizza, winner of Time Out’s “most loved restaurant” in the 2016 Love London Awards, has opened its fourth restaurant in the capital, in Leytonstone. The venue has launched in High Road offering the brand’s hand-made, stone-baked pizzas made from double-fermented dough. Pizzas come in 12-inch and 18-inch sizes and include The Holy Pepperoni (Cobble Lane pepperoni, Napoli piccante and crumbled nduja sausage), and TSB (broccoli, parmesan, pine nuts, garlic and olive oil). The brand also offers homemade dips, salads and sides such as cheesy marmite garlic bread alongside London beer and wine. The Yard Sale Pizza team told Hot Dinners it would explore more “love ins” – mash-ups with other street food operators – such as a cheeseburger pizza created with better burger brand Patty & Bun. Yard Sale Pizza opened its debut site in Clapton in 2014, going on to open sister restaurants in Finsbury Park and Walthamstow.

Papa John’s franchisees open eighth site, in Weston-super-Mare: Papa John’s franchisees John O’Brien and Clif Roberson have opened their eighth site, in Weston-super-Mare, Somerset, creating 20 jobs. The old school friends from Merthyr Tydfil joined Papa John’s at the end of 2015. They now employ 140 staff and plan to open another West Country site in the next few weeks. Roberson said: “Our first Papa John’s opened in Cwmbran and sales rapidly exceeded our expectations. We followed up by opening stores throughout the Welsh valleys including Pontypridd and Merthyr Tydfil and then expanded into England with the Yate, Bristol, opening in August last year. Weston-super-Mare is the perfect location for our continued southern expansion. There are many families living in the catchment area and it’s also a big tourist destination.” Papa John’s was founded in the US in 1984 and there are more than 350 stores across the UK and over 5,000 stores in more than 40 international markets and territories. The company said it was “actively recruiting” for more franchisees in the UK.

Cinnamon Collection opens third Cinnamon Kitchen, in Battersea: The Cinnamon Collection, which is owned by Boparan Restaurants, has opened its third Cinnamon Kitchen, at the Battersea Power Station development in south London. The 120-cover, 4,700 square foot restaurant is housed in a railway arch and features a large destination bar on the ground floor offering spice-infused craft cocktails, an open-plan kitchen, a semi-private chef’s table, and a private mezzanine dining room seating an additional 20 people. There is also a terrace with views of the Thames. Drawing inspiration from the grade II-listed power station, the interior features stripped-back decor with an “industrial vibe”. The restaurant also offers food and alcohol delivery to local residents. Cinnamon Collection executive chef and chief executive Vivek Singh said: “We have consciously decided to open restaurants in historic buildings and locations – The Cinnamon Club housed in the grade II-listed Old Westminster Library, Cinnamon Kitchen City in the historic East India Trading Company spice warehouses and Cinnamon Kitchen launching in the culturally rich city of Oxford – and we are thrilled to be opening by the iconic Battersea Power Station. We are excited to be a part of the urban regeneration.”

Starbucks courts digital relationships outside Rewards programme: Starbucks chief financial officer Scott Maw has said digital relationships outside its Rewards programme are key to driving visits and sales. The company said of the 75 million customers that come into stores each month, about 15 million were active Starbucks Rewards members. Since “virtually all of our comparable growth is being driven by digital relationships”, Maw said Starbucks was missing an opportunity to grow sales among customers who didn’t want to bother with the rewards programme, reports Nation’s Restaurant News. The programme requires customers to register as members before they can order and pay. The company’s Mobile Order and Pay programme is expected to roll out to anyone who downloads the app by the end of the year with no registration required. Easier access to the store’s free Wi-Fi is another digital initiative, with customers asked for their email address just once to connect to the network. Afterwards, access will be automatic with no requirement to accept terms and conditions through a browser. Maw told investors and analysts at the UBS Global Consumer and Retail Conference that adding emails allowed the company to establish digital relationships with customers – a key to capturing data and sending promotions to customers to drive visits. The goal is to have several million non-Starbucks Rewards digital relationships by the end of this year, he said. As previously reported, for its first quarter ended 31 December 2017, Starbucks saw its Rewards programme grow 11%, representing 37% of sales at company-operated locations. A total of 11% of sales at those locations came from mobile order and pay, underscoring the company’s plans to make digital ordering easier for customers.

Camerons gets go-ahead for Head of Steam site in Birmingham city centre: Camerons Brewery has had its plans to transform a building in Birmingham city centre into a site for its Head of Steam brand approved. Camerons revealed its plans to open in Temple Street in December, with an opening now pencilled in for May. Head of Steam will occupy the southern part of the ground floor of Somerset House, with Casual Dining Group brand Las Iguanas occupying the northern part. The Birmingham branch is expected to create 34 jobs, Insider Media reports. In documents filed by the city council, planning officers said: “Given the city centre location, the change of use to a bar with a restaurant would be acceptable and would bring a vacant unit back into use.” Camerons will open its latest Head of Steam site in Nottingham on Thursday, 22 March and another in Leicester on Thursday, 5 April. The Birmingham opening will take the brand’s number of sites to 15. Camerons’ estate consists of more than 70 venues. It acquired The Head of Steam brand in 2014.

Tim Hortons to open Manchester site this week: Tim Hortons, the Canadian cafe and bake shop owned by Restaurant Brands, will open its latest site in Manchester this week. The restaurant will open on Saturday (17 March) opposite Whitworth park in Oxford Road. SK Group is leading the UK roll-out of Tim Hortons and the opening will continue its nationwide expansion plan, having launched its first English drive-thru in Bury New Road, Manchester, in December. Kevin Hydes, chief finance and commercial officer of the Tim Hortons franchise in the UK, said: “After experiencing such excitement with our previous store openings, we’re delighted to announce our continued expansion in the Manchester area in Oxford Road.” Tim Hortons’ debut UK site opened in Argyle Street, Glasgow, in June last year and it has been rapidly expanding in England, Scotland and Wales as it plans up to 100 UK outlets. Tim Hortons was founded in 1964 by its namesake, a professional ice hockey player who wanted to create a space where “everyone would feel at home”.

East Coast Concepts to open second Victor’s site, in Oxford next month: East Coast Concepts will open a second site for its Victor’s concept, at the new Westgate development in Oxford next month. The company is investing more than £1.8m in the rooftop venue, which will have 120 covers, a bar and an outside terrace with views of Oxford’s spires. Victor’s, which was launched in Hale, Greater Manchester, in 2014, offers a menu of modern American small plates designed to share with dishes served in the centre of the table. The menu includes black cod, lobster tacos, sushi and raw bar platters, and lamb cutlets presented on a konro grill. Drinks include wine and cocktails. East Coast Concepts chief executive James Hitchen said: “Our mission is to offer guests a luxurious yet accessible dining experience, the quality and range of our menus is unrivalled. Everything we do is to the highest standards and we are about more than just outstanding food – it’s the entire experience. As a brand we are ready to take the next step and set down roots in the south, and Oxford felt like the perfect new home for us.” East Coast Concepts, which also operates the three-strong Neighbourhood brand, previously reported a record-breaking 2017 with revenue hitting £10m for the year to 31 December and further expansion on the cards.  

Winchester-based pizza concept Pi Woodfired opens Clapham restaurant for second site: Winchester-based pizza concept Pi Woodfired has opened a site in Clapham, expanding into London for its second venue. Founder Rosie Whaley has opened the 85-cover restaurant in Battersea Rise. The concept is based on 20-inch sharing pizzas with up to three flavour combinations. A key focal point of the new restaurant’s dining area is a living tree. The tables are hand-carved from fallen oaks found in Salisbury woodland, while there is banquette seating. An open kitchen sits off the dining room, while the bar features a ceiling installation of dried flowers. Pi is currently running a £500,000 campaign on crowdfunding platform Growthdeck to fund three openings in south London to go alongside its debut Winchester site, which opened three years ago. Whaley is offering a 30% equity stake in return for the investment and so far the campaign has raised £412,000 from 28 investors. Pi is targeting three London openings by 2020 at the rate of one a year. The £500,000 is offered to investors in two strips – £250,000 of EIS-qualifying equity and a secured loan of £250,000 paying interest of 8% per annum. The equity strip offers investors the prospect of 8.3 times money return after the benefit of 30% initial income tax relief. Whaley said of the Clapham site: “It’s been three whirlwind years since we brought Pi to Winchester and I’m so excited to be opening a second site. Londoners have an insatiable passion for pizza and I hope we can bring a slice of something special to the table.”

Stonegate Pub Company to open Newbury Walkabout this week: Stonegate Pub Company will open a site for its Walkabout brand in Newbury, Berkshire, on Thursday (15 March). The venue was acquired from JD Wetherspoon and will reopen following an investment of almost £400,000 and the creation of 15 jobs. The venue will feature 15 screens showing live sport and a menu featuring new dishes the Balls Out Burger and Katsu Curry Parmi alongside sharing dishes, party platters, craft beer, wine and Aussie Twist cocktails in cans. A limited-edition menu will be available during sports events, including buckets of chicken wings. The venue will open daily from 10am to 2am. General manager Annie Partington said: “Our customers will love the little bit of outback we have brought to Newbury.” Stonegate acquired The Diamond Tap in Cheap Street from JD Wetherspoon in 2016 and considered “how best to secure the pub’s long-term future”, submitting plans to turn it into a Walkabout in January.

Former Chiltern Firehouse head chef to launch restaurant at new Stratford development: Former Chiltern Firehouse head chef Patrick Powell is planning to launch a restaurant at a new development in Stratford, east London. The venue will be part of Manhattan Loft Gardens, a huge new tower that is nearing completion overlooking the Olympic stadium. The tower will be a combination of hotel rooms and apartments, along with three planned sky gardens and a “design hotel”. Powell plans to open his new space on the seventh floor of the building, Hot Dinners reports. Manhattan Loft Gardens will be a double-cantilevered tower “harnessing the creativity and tech spirit of Stratford City”, and is being developed by Manhattan Loft Corporation. Chiltern Firehouse, which comprises a restaurant and hotel, has become renowned for attracting A-list celebrities.

Nando’s threatens Reading restaurant with legal action: Nando’s is threatening legal action against a Reading restaurant it believes has infringed its copyright. The company is concerned an eatery called Fernando’s, in Oxford Road, Reading, may be trying to mimic it by using similar cockerel and chilli images. But Fernando’s director Asam Aziz said this was not the case and claimed he got the idea for the restaurant from television dating show Take Me Out, where couples take a trip to the island of Fernando’s in Tenerife. Aziz, who is meeting intellectual property specialists to see where he stands, said his company was too small to take on Nando’s, while he is worried legal action could force it to close. A Nando’s spokesman told The Metro: “We are really proud of our brand and we know it means a lot to our customers. That’s why whenever we think there is trademark infringement we try to sort it out amicably. We have asked this restaurant to rebrand because we believe it is trying to benefit from some of the things that make us who we are – our menu, logo and even our name.”

Douglas Jack – JD Wetherspoon’s food sales are equivalent of almost 10% of restaurant market: Peel Hunt leisure analyst Douglas Jack has estimated JD Wetherspoon’s food sales are the equivalent of almost 10% of the restaurant market. Issuing a ‘Hold’ note on the shares with a target price of 1,200p ahead of the company’s interim results on Friday (16 March), Jack said: “Although no margin data was provided for the second quarter, the company stated the first quarter and second quarter were equally profitable, with total and like-for-like sales steadily converging. In the first quarter, total sales growth was 4.1%, with a flat margin, at 8.6%. We expect total sales to have picked up to 4.7% in the first half due to slowing disposal activity. Like-for-like sales rose by 6.0%, helped by investment in breakfast, beer gardens, accommodation, tail-end disposals (41 pubs were sold in both 2016 and 2017) and its app (downloaded more than 2.3 million times and on which spend is food-biased). Our full-year forecast assumes like-for-like sales will grow by 3% in the second half, partly due to tougher comparables and likely softer trading during the FIFA World Cup. Since 1996, like-for-like sales have fallen by an average of 1% to 2% during World Cups but the impact has been less material since Wetherspoon introduced televisions in 2004-06. We forecast 40 basis points margin growth in the first half, supported by growth in accommodation, freehold reversions and tail-end disposals, offsetting higher wages, excise duty, business rates and energy taxes. The sugar levy affects the second half. Management expects this year’s profit growth to be heavily weighted to the first half but we believe December drink price increases (2.1% year-on-year) should offset some of the cost pressures. Only three pubs opened and ten pubs were sold in the first half. In 2018E, the company should open ten pubs and sell up to 20 others. Net debt is expected to rise by £30m this year, to 3.5 times net debt/Ebitda by our estimates. Asset quality is improving with almost 60% of outlets now having freeholds. We believe Wetherspoon’s rating is full, at a material premium to its freehold peers (8.1 times), but it is developing a habit of beating expectations, benefiting from greater trading down than we expected. With 888 outlets, we estimate Wetherspoon’s food sales are the equivalent of almost 10% of the restaurant market.”

Zizzi first restaurant brand to sign for Aylesbury development: Azzurri Group-owned Zizzi has become the first restaurant brand to sign for The Exchange development in Aylesbury, Buckinghamshire. Zizzi will sit alongside three other, as yet unnamed, restaurant brands in the new development, with all four set to open in November. Aylesbury Vale District Council revealed the news in its Vale Times magazine stating it was “making sure the signings complement the other restaurants in the town such as Wagamama, Nando’s and Gourmet Burger Kitchen, which all opened a few years ago”.

Peel Hunt – Escape Hunt ‘provides opportunity to back seasoned management team addressing a global growth market’: Peel Hunt leisure analyst Ivor Jones has said Escape Hunt “provides an opportunity to back a seasoned management team addressing a global growth market”. Issuing a ‘Buy’ note on the shares with a target price of 130p following the company’s trading update, Jones said: “It announced the opening of its first self-developed site in Bristol and the acquisition of another in Bournemouth. So far 100% of the (two!) reviews on TripAdvisor of the Bristol site are five stars. Eight more sites are expected to open in the ‘coming months’. It also refers to a detailed strategic review, which has ‘opened up the possibility for exciting partnerships with content providers and franchise opportunities’. We believe ‘experiential’ leisure is a growth market and, if Escape Hunt establishes sector leadership, it could successfully develop beyond its core business. As management reported in December, it has taken longer than originally forecast to open the first site. In part this is a consequence of planning permission and site negotiation taking longer than expected. But this also results from management refining the business model and deciding to focus on more central locations and develop ‘higher-quality and scalable games’. We did not adjust our forecasts in December while we waited for more data. It is now time to make a change. Our initial revision is a cut to our FY18E Ebitda forecast to a loss of £1.9m from a profit of £1.9m, FY19E to £3.1m from £4.6m and FY20E to £6.6m from £8.1m. In the nature of a startup these forecasts remain highly uncertain – our base case Ebitda forecast is based on occupancy of 38%, at 45% occupancy our per-site Ebitda forecast would be 64% higher. It will be some months before there is enough trading data for us to refine our model further. On our revised forecasts, the group will end FY18E with £3m of net cash, and clearly management can flex the site opening programme to manage the cash position if required. We are lowering our target price to 130p from 165p. Clearly valuation is somewhat conceptual at this stage of Escape Hunt’s development. Our change to forecasts is material in percentage terms but tells us relatively little about the prospects for the business. We remain positive on the basis of the potential for rapid profit acceleration; on our forecasts the price-to-earnings ratio falls to seven times in FY20E from the 20 times for FY19E. Escape Hunt is a roll-out story at a very early stage. The concept has not yet been proven in the planned owned/operated format and there are execution risks. The shares provide an opportunity to back a seasoned management team in a well-financed vehicle addressing a global growth market. We reiterate our ‘Buy’ rating while reducing our target price to 130p.”

Wireless Social signs agreements with TGI Friday’s and Patisserie Valerie to decipher customer data: Wi-Fi solutions provider Wireless Social has signed agreements with TGI Friday’s, Itsu, Patisserie Valerie, Paul UK, The Rum Kitchen and Texas Roadhouse to decipher customer data. Four of the companies have signed for a minimum of three years. Wireless Social now has more than five million active users, allowing operators to better understand their customers’ likes and interests through data collected during Wi-Fi log-in. The company has also launched an email marketing solution – Fully-Managed-Service – that it said has helped existing operators increase footfall in their venues by 32%. Wireless Social managing director Julian Ross said: “We are delighted to have added six brilliant brands to our client base and look forward to working with them closely over the coming months.” Specialising in hospitality and leisure, Wireless Social provides consented customer insight collected from social media platforms.

Carlsberg offers taste of history with lager rebrew: Carlsberg UK is launching a taste of history with a rebrew of the “world’s first quality lager”, Carlsberg 1883, available exclusively in the on-trade until June. Brewed in Denmark, Carlsberg 1883 is a Danish-style dark lager, described as “full-bodied and rich in malt and caramel”. It is brewed using Carlsberg’s original 134-year-old yeast, commemorated by the Carlsberg Rebrew project. Brewers at Carlsberg set about brewing a new beer, Carlsberg 1883, which respects the past but delivers a “contemporary taste that appeals to a modern palette”. Liam Newton, vice-president of marketing for Carlsberg UK, said: “The beer market has changed dramatically in the past few years, let alone since 1883, so it is important brewers like ourselves demonstrate the quality of our beers and the dedication of our brewers and ultimately help create reasons for beer-drinkers to visit the pub.”

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