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Wed 11th Apr 2018 - Update: Thai brand seeks investor, Easyhotel, Escape Hunt
Thai brand seeks equity investor as it opens its 13th site: An award-winning Thai brand is seeking an investor following the successful opening of its 13th branch, this time in Hove in Sussex. Led by Minhaz Nasir, who opened his first Lemongrass restaurant in Worthing in Sussex in 2005, Lemongrass now has branches in Chichester, Petersfield, Cranleigh, Compton near Guildford, Crawley, Rustington (Littlehampton), Horsham, Burgess Hill, Lewes, Brentwood, two in Worthing and now Hove. With a focus on top-end Thai cuisine, each restaurant has between 55 and 100 covers and generates a profit of around £15,000 a month per site. The restaurants also operate a separately branded in-house Japanese concept, Issa Sushi, in Worthing and Lewes. The company has a 140 full-time staff on its payroll. Expansion, until now, has been funded through reinvesting profits and a bank facility. Adopting a low key approach to the company’s expansion, Lemongrass has no group website to avoid alienating potential custom from the growing segment of the market avoiding large chains. The concept has opened seven sites in the last year, and Nasir, whose management team consists of himself and three family members, feels the company is nearing the limit of its operational capabilities. “The business had proven that it is a scalable concept and it’s time to put in a new management team, update our systems and reengineer the business,” said Nasir. “The best way forward is to partner with an organisation experienced in larger operational matters, whilst I focus on our core values and the food, acting more as an executive chef.” Lemongrass has been a repeated winner in the prestigious Asian Curry Awards, organised by the Asian Catering Federation. Its Crawley venue was declared Best Thai Restaurant in 2015 and 2016. In 2017 Lemongrass was named Best Asian Restaurant Chain. Nasir, 44, who was born in Bangladesh where he began cooking at the age of 7, honed his culinary skills in Dubai before moving to London to work in Bangkok restaurant in South Kensington. The company said it will listen to offers for up to 50% of its equity from the right partner.

Easyhotel reports sales and Revpar up: Easyhotel has reported total system sales were up 33.6% to £16.10m (31 March 2017: £12.05m) in the six month to 31 March 2018. Owned hotels Revpar was up 11.2% to £36.60 (31 March 2017: £32.90), and have outperformed their competitive set by 11.7% (source: STR Global). Like-for-like revenue for franchised hotels increased by 13.5%. The period saw the opening of a new owned 78-room hotel in Liverpool and the acquisition and opening of a 104-room leased hotel in Newcastle. Both hotels have traded strongly, in line with the performance trend of the hotels opened during the last financial year. The group also expanded its franchise portfolio with the opening of the 87-bedroom Easyhotel The Hague, Scheveningen Beach in March 2018. These openings increase the group’s footprint to 2,430 rooms across 27 hotels in 18 cities. The company has also agreed to acquire the freehold of a central site in the historical city of Chester for the development of a new-build 109-bedroom hotel. The acquisition is subject to planning permission. Chief executive Guy Parsons said: “Easyhotel has traded strongly over the first half of the financial year, outperforming the wider market in both our owned and franchised hotels. We are mindful that consumers in the UK will continue to be cautious, given the wider macro-economic and political uncertainty, but believe our super budget offer positions us well, as consumers become increasingly discerning and value conscious. We continue to make good progress with our growth strategy. The Chester transaction marks our second investment following the successful fundraising announced in February 2018, taking Easyhotel’s pipeline of owned and leased development projects to 1,150 rooms, in addition to the 1,857 franchise rooms currently under development. The proceeds from our successful fundraising will enable us to accelerate our growth and take advantage of the significant opportunities within our markets, creating shareholder value and underpinning the long-term growth of the Easyhotel brand.”

Escape Hunt reports ‘exciting’ maiden year: Escape Hunt, the “escape rooms” operator, has reported sales of £870,000 for the year ending 31 December 2017. Escape Hunt was acquired in May 2017 for £12m, of which £7.2m was paid in cash and the balance of £4.8m by issuing 3.55m new shares. The first owner operated sites in Bristol, Birmingham and Leeds were opened in March 2018, with a further five UK locations to open in the coming months. It had a pre-tax loss of £0.74 million for the period to 31 December 2017 before amortisation charges and acquisition related transaction costs. It has a ‘strong cash position’ of £10.65 million as at 31 December 2017 (2016: £7.92 million). Chief executive Richard Harpham said: “This has been an exciting maiden year for Escape Hunt following last year’s re-admission to AIM. The group’s near-term goals are to extend the roll-out of our owner operated and franchise sites, diversify our product offering and build on the success achieved by the Escape Hunt brand. The group will continue to launch new games and other products to meet the changing demands of our global customer base. However, investment in our brand is vital and our marketing activities will seek to strengthen further the company’s brand awareness. Initial reception to the repositioning of the brand is very positive although it is still early days and the enhanced brand is yet to be rolled out to the franchisee network. We have been acquiring sites and are now well under way with the roll-out programme. Three UK owner operated sites were opened in March 2018 and we expect to have a total of eight open by late summer, with a strong pipeline of future sites. While they have only been open for a matter of days overall, the initial customer response to the sites and to the games has met our highest expectations. The board believes that the opportunity for the business is larger than initially thought. The repositioning of the brand will enable the company to forge deals with content providers to differentiate Escape Hunt from its rivals and make its escape rooms “go to destinations”. We are confident that we can meet the challenges that lie ahead in 2018 and beyond.” 

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