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Mon 9th Sep 2019 - Propel Monday News Briefing

Story of the Day:

Sector like-for-likes up 1.6% in August as wet-led pubs and London venues benefit: Britain’s managed pub and restaurant groups saw collective like-for-like sales grow 1.6% in August compared with last year, with wet-led pubs and venues in London being the best performers, according to the latest Coffer Peach Business Tracker. Managed pub groups recorded like-for-like sales growth of 2.4% for the month, with wet-led sites ahead 4.1%. Pub groups saw drink sales up 3.8% during the month, with food sales marginally down 0.1%. Restaurant groups had a more subdued month following a good July, with collective like-for-like trading down, but only by 0.2%. Regionally, London performed better than the rest of Britain, with like-for-like trading up 2.9% against 1.2% for outside the M25. Restaurant groups in the capital were also in positive territory, up 0.5%, while those outside the capital saw a 0.5% fall. “The weather, as is often the case, played a big part in shaping sales, with the hot weather in the run-up to and during the bank holiday weekend boosting pub trading and suppressing restaurant sales,” said Karl Chessell, director of CGA, the business insight consultancy that produces the Tracker in partnership with Coffer Group and RSM. “The good news is that even with the uneven effect of the weather the underlying performance was 1.6% up on last August following growth of 1.2% in July. Drinking pubs in London were the ones that really benefited from the mini-heatwave, with a 5.0% like-for-like boost.” Mark Sheehan, managing director of Coffer Corporate Leisure, added: “These are solid numbers generally, with pub sales again outperforming restaurants partly helped by the weather. Consumer habits are changing fast especially in the restaurant sector, evidenced by The Restaurant Group announcing it is to close up to half of its mainstream restaurants over time. Until recently these were seen as the best portfolio of sites in the market and demonstrates the difficulties being experienced by many restaurant chains. Only the exceptional are performing well. The pub sector by contrast is resilient. Pubs are generally unbranded and don’t suffer from the often limited lifespan a brand may face.” Total sales across all companies in the Tracker, which include the effect of net new openings since this time last year, were ahead 4.3% compared with last August. Underlying like-for-like growth for the Tracker cohort, which represents large and small groups, was running at 1.7% for the 12 months to the end of August.

Industry News:

Propel Multi Club Conference opens for bookings, Ed Devenport talks to Mark Wingett, two free places for operators: The final Propel Multi Club Conference of 2019 is open for bookings. The full-day event takes place on Thursday, 14 November at the Millennium Gloucester hotel in London. Ed Devenport, co-founder of Incipio Group, will talk to Propel insights editor Mark Wingett about how the business, which secured £5m earlier this year to open six sites, creates bespoke consumer locations and venues, each with a unique and unforgettable atmosphere. Multi-site operators of pubs, restaurants and foodservice outlets can book up to two free places by emailing Anne Steele at
Goodbody – trading statements suggest August has been better for wet-led operators as weather improved: Goodbody leisure analyst Paul Ruddy has said recent trading statements from sector companies suggest August has been better for wet-led operators as weather improved. Ruddy made his comments in the wake of Greene King’s first-quarter update, where like-for-like sales in its managed division were down 1.8% in the 18 weeks to 1 September but up 1.5% in the most recent seven weeks. He said: “This summer was always going to be tough for the wet-led operators given the Fifa World Cup and weather comparative. The most recent pub company to report was Mitchells & Butlers (more food-led), which reported the previous ten weeks trading to 27 July. It reported like-for-like sales growth of 2.8% in this period and 3.6% in the 43-week period to the end of July. Marston’s also reported like-for-like sales growth for the 42 weeks to 20 July. For this period like-for-like growth in Destination and Premium was up 0.1%, with an implied like-for-like decline of 1.5% for the last 16 weeks of this period. The Restaurant Group and Greene King trading statements this week would suggest August has been better for the wet-led operators as weather improved.”
F&B and leisure drive up to one in ten visits to regional retail destinations: Almost one in ten trips to regional shopping centres are driven primarily by food and beverage or leisure visits, according to marketing, technology and data company CACI. While the figure drops to one in 20 visits for retail and shopping parks, 7% of overall visits to all retail destinations are food and beverage or leisure-led. Significantly for retail brands and owners of retail destinations, 50% of those people visiting primarily for food and beverage or leisure go on to spend on retail. In addition, regardless of the original reason for visiting a destination, anyone who spends on food and beverage during a visit has a 48% higher retail spend during their trip compared with visitors who just shop. The research, which utilises Shopper Dimensions, CACI’s database of 800,000 customer-facing surveys from across the UK, also highlighted regional differences in consumer behaviour. In the north west, for example, the number of food and beverage or leisure-led visitors that go on to spend on retail increases to 62%. By contrast, in London the figure drops to 34% because of the level of competition in the capital. CACI director John Platt said: “Our latest research once again highlights that all is far from lost for retail and leisure destinations. By thinking laterally and recognising there are other key reasons why consumers visit locations beyond retail, landlords can drive additional spend in stores.”
CAMRA echoes think-tank’s call for alcohol duty reforms: The Campaign for Real Ale (CAMRA) has echoed calls in a report from think-tank Social Market Foundation that explores the case for reforming alcohol duty in the UK. The Social Market Foundation said the move would focus alcohol duty on the off-trade, which is “particularly reliant on sales to hazardous and harmful drinkers”. The foundation proposed a shift in the burden of taxation towards high-strength drinks bought for consumption at home and away from weaker products bought in pubs. Among its five recommendations was the introduction of “Pub Relief”, which would allow licensees to claim back a proportion of alcohol duty. CAMRA national chairman Nik Antona said: “We echo the calls in the report for a taxation solution that favours on-trade consumption, especially on lower-strength drinks such as beer. Beer and pubs already face a huge tax burden – one of the highest rates of duty in the EU and an unfair business rates burden. CAMRA is campaigning for a lower rate of tax on beer served in pubs as this would level the playing field between cheap supermarket alcohol consumed at home and beer sold in a community pub. It’s great to see others calling for measures that would achieve this.”
US restaurants see sales slowdown continue as like-for-likes fall 0.7% in August: US restaurants saw the sales slowdown continue as like-for-likes fell 0.7% in August. It was the second consecutive month like-for-likes have fallen – a trend not seen since January and February last year when weak sales were largely attributed to bad winter weather. However, the sector is up against tougher comparables given the industry’s stronger performance during the last two quarters of 2018, according to data company TDn2K’s Restaurant Industry Snapshot, which is based on weekly sales from more than 31,000 restaurants and 170 brands that represent almost $72bn in annual revenue. Victor Fernandez, TDn2K vice-president of insights and knowledge, said: “August’s like-for-like sales growth compared with the same month two years ago is actually an encouraging 1.2%. The industry’s sales continue to be better than they were two years ago in comparable stores. In other words, the industry’s performance has held up in recent months from a longer-term perspective but, in this new world of persistently eroding guest visits, strong year-on-year sales growth performance is simply not possible every year.” Fine dining was the best-performing segment based on like-for-like sales growth during August. The only other category that posted an increase during the month was family dining. The industry is expected to experience weak like-for-like sales growth in the final third of the year. Average like-for-like sales growth for the last four months of 2018 was 1.3%, Fernandez said. Given the tougher comparisons, small like-for-like sales growth is a “best-case” scenario for the rest of the year.
BBPA supports labelling ingredients and calorie values on all beer bottles and cans in EU by 2022: The British Beer & Pub Association (BBPA) has signed a memorandum of understanding (MoU) committing to encourage all its members to label ingredients and calorie values on all beer bottles and cans in the EU by 2022. The purpose of the MoU is to encourage producers to voluntarily declare relevant ingredient and calorie information on their product labels. The MoU is open to companies and associations from all alcoholic beverage sectors provided the signatory fully endorses the MoU and its commitment to the on-pack labelling of ingredients and calorie values. In the past four years brewers have been voluntarily rolling out ingredients and calorie labelling. BBPA chief executive Brigid Simmonds, who signed the MoU on behalf of the trade association and the members it represents, said: “Consumers want more details on what their beer contains and are conscious about calories too. They also want this information to be clear and transparent.”
Job of the week: COREcruitment is seeking a head of marketing on behalf of a boutique hospitality business. Candidates, who will be joining a growing national business focusing on experiential hospitality, will need to have function set-up experience within a leisure, attraction or ticketing environment. The position offers a salary of £80,000 plus benefits. For more information or a confidential chat, email

Company News:

Warrington-based multiple operator eyes wider north west expansion after acquiring tenth site: Warrington-based multiple operator Priory Inns North West is eyeing wider expansion across the region after growing its portfolio to ten sites. The company has taken its second property with Heineken-owned Star Pubs & Bars – The Gardeners in the village of Timperley. With the pubs located in or around Warrington, Priory Inns North West is now looking to broaden its geographical spread. Director Neil Sparkes said: “We have got no finite number for the size of our business. Our expansion plans will be determined by getting the right team to work for us. Finding pubs for our expansion plans shouldn’t be a problem as there are a lot of good pubs such as The Gardeners and we’ve got a strong record so pub companies like working with us.” The Gardeners has reopened following a £380,000 joint refurbishment and the introduction of food. The interior has been opened up to create an open-plan space seating 120 with an island bar. A new garden has been created at the back with seating for 80 people. David Pritchard, Star Pubs & Bars regional operations director, said: “We are delighted Neil and his team have taken on The Gardeners. He has The White Hart in Warrington with us and has a great track record of turning around underperforming pubs. We wish him every success with this latest venture and look forward to future projects as he grows his north west-based estate further.”
SSP to launch international food hall concept at Brisbane airport: SSP Group, the UK-based transport hub foodservice specialist, is to open an international food hall at Brisbane airport. The company has secured a seven-year contract worth circa £40m to launch Food Collective. It will be the first of its kind in an Australian airport, drawing inspiration from street food and farmers’ markets. The concept will feature a large centralised seating area while on-site self-order kiosks will allow passengers to order food across all five restaurants. The operators within Food Collective will be YO!, Australian burger bar Ze Pickle, New York-inspired concept Upper West Side Deli, Nippon Ramen and Mexican concept Mi Casa Burritos. SSP will rotate new food and beverage offers into the Food Collective precinct midway through the contract. Food Collective will open in November on Level 2 Departures of Brisbane airport’s domestic terminal. Mark Angela, chief executive of SSP Asia Pacific, said: “We are proud to work in co-operation with Brisbane airport to develop the Food Collective, which is a style of concept that has never been seen before in Australian travel retail.” Martin Ryan, executive general manager consumers at Brisbane Airport Corporation, added: “The upgraded Cafe Court in the northern end of the terminal forms the centrepiece of stage two of the domestic terminal redevelopment and SSP’s exciting hawker-style dining options will bring a unique point of difference.”

Hand Picked Hotels sees losses deepen as founders inject a further £17m into business: Hand Picked Hotels, owned by Julia and Guy Hands, has seen losses deepen in its latest financial year as its founders injected a further £17m into the business. The company saw turnover fall 2.4% to £60,183,126 for the year ending 29 November 2018, compared with £61,677,682 the year before. Operating profit was down to £1,231,281, compared with £2,263,528 the previous year. Pre-tax losses increased to £4,258,928, compared with £213,461 the year before, according to accounts filed at Companies House. The Hands’ injected £17m in the company during the period, adding to the £29,6m they have already loaned the business. Since the year end, it has used the loan and the proceeds from selling the Hendon Hall Hotel in north London to repay £50m of bank debt. In their report accompanying the accounts, the directors stated: “The group is still well positioned for growth as the market continues to recover, driven by investment that will deliver increases in sales and operating profit. The ongoing improvement in brand perception together with the continued drive towards excellence in service provision will also contribute to further growth. The company's receipt of shareholder loans in the period of £17m is a large contributing factor in the increase in net current assets. Subsequent to the period end, the company has utilised these shareholder loans and available cash to repay £50m of its bank loans. This has not only relieved pressure on covenants, but has affected the external gearing on the group hotel assets. The revised gearing ratio taking into consideration the loan repayments is 22% (59% at the year end).” Hand Picked Hotels owns and runs 19 hotels across the UK and Channel Islands.

Robinsons ‘trading well’ in 2019, has firepower to grow estate but ‘timing’ and ‘pub type’ are key: William Robinson, managing director of the pub division at north west brewer and retailer Robinsons, has told Propel the company has continued to trade well this year following a record-breaking 2018. Robinson also said the company has the firepower to add to its pub estate but timing and pub type were key and added there was not a huge amount of opportunities in the market currently. Speaking to Propel on the back of announcing its 2018 results, where turnover rose 6.1% to £75.5m and pre-tax profits jumped to £7.1m, Robinson said: “This year has continued with the trend from last year and we are trading well. Obviously we haven’t had a Fifa World Cup this summer but we’re satisfied with the performance of the pub estate. It will be interesting to see how the remainder of the year unfolds and we will see where we end up.” Robinson said the company had continued to invest in its pubs on the back of its £26.7m of capital expenditure during the past five years when it completed 127 refurbishments, and was planning a similar level of investment for the next five years. He added the estate was in “good shape”, while it was continuing to grow its 12-strong managed division by converting tenanted pubs, where appropriate, and making strategic acquisitions. In terms of acquisitions, Robinson said: “If good opportunities arise we will look at them but timing and pub type are key. The pub market is in a very different place to that of restaurants, which is very much a buyers’ market. We have the financial power to do deals but there’s not a huge amount of the type of properties we are looking for. It’s about making sure the pubs are the right fit and not about chasing numbers.”
The Burger Priest to open third site, in Stoke: The Burger Priest, the church-themed burger restaurant concept launched by Bar Sport founder Scott Murray, is to open its third site, at Intu Potteries in Stoke. The restaurant will open this month in the shopping centre's leisure complex, The Hive. The 40-cover, 2,000 square foot restaurant will be located between PizzaExpress and The Restaurant Group-owned Chiquito. A The Burger Priest spokesman said: “We think Intu Potteries is the perfect venue and we’re looking forward to opening as soon as possible.” Rachael Jackson, general manager at Intu Potteries, added: “We are thrilled to welcome The Burger Priest to the centre. Its food will be a great addition, bringing a new dimension to the overall dining experience at The Hive.” The Burger Priest currently operates sites in Harlow and Swindon.  

Soho Coffee Co evolves food offer as it opens fourth City site: Artisan food-led coffee company Soho Coffee Co has opened its fourth City of London site, featuring an evolved and extended fresh food offer. The flagship outlet in Threadneedle Street has seating over two floors and features a series of firsts for the company – a carvery hot meat sandwich menu, a healthy Roots & Fruits juice bar and fresh salad bar – alongside its staple triple-certified coffee. The four-step carvery offers customers a choice of wrap, baguette, brioche roll, roast potatoes or salad alongside roasted meat, and a range of home-made condiments and sauces. Plant-based food is an important feature of the offer with a salad bar and the company’s first juice bar – offering a range of freshly squeezed fruit and vegetable juice. The new opening comes a week after Soho Coffee Co launched its second Birmingham Bullring site and precedes the opening of its first international retail mall store, in Qatar, with a new franchise partner in late October. Soho Coffee Co opened its first store in 1999 and now has more than 40 sites in the UK and internationally.

Southampton-based operator takes on pub that once sparked legal battle with Hollywood for third site: Southampton-based pub operator Jack Andrews has acquired his third site in the city. Andrews has taken on The Hobbit, the Middle-earth themed pub that belongs to Heineken-owned Star Pubs & Bars, and once sparked a legal battle with Hollywood. Andrews plans to invest in the Bevois Valley Road property, as well as bring more live music to the venue. He told the Daily Echo: “I’m a big fan of the books. When I first heard it might be available I kept my ear out and said I would be happy to take it on. We want to keep the theme but invest and make improvements.” Andrews takes over from Stella Roberts, who surrendered the lease last month after 12 years at the helm. During her tenure, the pub was involved in a legal battle with Hollywood, which accused the pub of using the name “The Hobbit” and other JRR Tolkien characters and film images in the pub. The legal battle sparked a fund-raising campaign, while Sir Ian McKellen and Stephen Fry helped support the pub in 2012 when Saul Zaentz Company accused it of copyright infringement. Andrews already running the Black Phoenix in Carlton Place and the nearby The Shooting Star, which is also in Bevois Valley Road.

Hill-backed Bosco Pizzeria gets go-ahead for Bath opening: Bosco Pizzeria, the Bristol-based concept that includes Steve Hill, former chief executive of Wagamama and current chairman of Pho, as a backer, has been given the go-ahead to open a third site, in Bath. The concept, which was founded in 2014 by owner Miles Johnson, has been granted permission by Bath and North East Somerset Council to open at the former CAU site in Milsom Place. Bosco Pizzeria operates two sites in Bristol, in Whiteladies Road and Clifton Village. The menu features about a dozen pizzas as well as pasta dishes and a few meat and fish options, while the Italian wine list offers 20 varieties by the glass.

Online food delivery business Lean Lunch fails in bid to raise £120,000 after seeing some larger investments cancelled: Online food delivery business Lean Lunch, which aims to “improve well-being for people and the planet”, has failed in its bid to raise £120,000 on crowdfunding platform Crowdcube after seeing some larger investments cancelled in the final week of the campaign. The company originally hit its target last month but subsequently saw some of the funding cancelled, which totalled about £40,000. It was unable to recoup the lost funding by the campaign deadline. Launched by Sat and Charlotte Mann, Lean Lunch delivers chef-prepared, sustainably packaged food to city centre offices by cargo bike. The company now aims to scale up and was offering 11.32% equity in return for the £120,000 investment, giving the company a pre-money valuation of £940,000.

City Pub Group gets go-ahead to transform former Wetherspoon site in Cambridge including crazy golf and street food stalls: City Pub Group, led by Clive Watson, has been given the go-ahead to transform a former JD Wetherspoon-owned pub in Cambridge into a venue featuring crazy golf and street food stalls. City Pub Group bought The Tivoli, which was ravaged by fire in 2015, last year. Now it has had its plans, which include two nine-hole crazy golf courses on the first floor, approved by the city council, reports Cambridgeshire Live. The new-look venue will also feature a rotating line-up of three street food traders on the ground floor. The outlets will be franchises and won’t offer takeaway food but may operate a delivery service. Diners will also be able to order food at the main bar, while there will be a shuffleboard deck in the basement. The second floor will feature an 80-seater, multi-purpose events space that will be fully equipped for community groups to hold film screenings and host yoga classes, live music, meetings and parties. The room will open on to a terrace facing the river Cam. The pub will also feature a rooftop terrace.

Tony Macaroni opens second Northern Irish site: Scottish restaurant brand Tony Macaroni, which is part of the Viva Italia Group, has opened its second site in Northern Ireland. The 180-cover Italian restaurant has launched in Belfast’s Victoria Square following a £600,000 investment. The group also has a restaurant in Bangor, County Down, which opened in March last year. Tony Macaroni managing director Sep Marini told the Irish News: “We had a very warm welcome from the Northern Irish community when we opened in Bangor so we are excited about our new restaurant in Belfast.” The first Tony Macaroni opened in East Kilbride in 2007. The group now runs 19 restaurants.

Ben Tish to launch Sicilian restaurant at The Stafford London this week: Five-star boutique hotel The Stafford London in St James’s will launch its first independent restaurant project this week under the direction of culinary director Ben Tish, former Salt Yard Group chef director. Norma, which opens on Wednesday (11 September), is inspired by the food and culture of Sicily and will focus on Moorish influences on the island’s cuisine. The venue will be split across three floors, with the restaurant on the ground floor, a cocktail bar above and a private dining space on the top floor. Norma will also feature a crudo bar at its entrance. Tish was appointed culinary director in January 2018 and oversees the entire food offering at the five-star hotel, including The Game Bird restaurant, American Bar, Wine Cellar, private dining, suites and in-room dining.
Hawksmoor promotes manager who accidentally gave away £4,500 bottle of wine: An assistant manager who gave a table a £4,500 bottle of wine by accident at a Hawksmoor restaurant has been promoted. Ellen Stott was shadowing the management team at the Manchester restaurant when the mix-up happened. Stott has now been given the senior role of general manager at Hawksmoor’s Edinburgh branch. In May, Stott served a table who ordered a £260 bottle of 2001 Chateau Pichon Longueville Contesse de Lalande but accidentally served them a £4,500 bottle of Chateau le Pin Pomerol 2001. The table drank the wine without noticing the error. Hawksmoor stated: “Ellen has been a pillar of strength and influence, understanding what makes Hawksmoor while adding her own personality to the restaurant. We couldn’t be prouder and just goes to show, mistakes happen and we’ve all been there, and if you work hard and are nice to people, good things come your way.” Hawksmoor Manchester revealed the mistake at the time in a cheery tweet that read: “To the customer who accidentally got given a bottle of Chateau le Pin Pomerol 2001, which is £4,500 on our menu, we hope you enjoyed your evening! To the member of staff who accidentally gave it away, chin up! One-off mistakes happen and we love you anyway.” Hawksmoor opened its first restaurant in London’s Spitalfields in 2006 and now has six venues across the capital and eight throughout the UK.
McArthurGlen tables plans for additional restaurants as part of £40m York Designer Outlet investment: McArthurGlen has tabled plans for additional restaurant units at the York Designer Outlet as part of a £40m investment. The proposals include about 25 new retail and restaurant units, 630 additional parking spaces and an improved park-and-ride facility. The planning submission to the city council comes after two public exhibitions were held in June. Mike Thomas, centre manager at York Designer Outlet, said: “Our plans would deliver hundreds of jobs and significantly improve parking.” York Designer Outlet currently welcomes 4.5 million visitors each year and employs 1,700 staff.
Investment fund founder acquires Hampshire hotel: Simon Henderson, who set up investment fund Provenance Investment Partners, which has invested in the Richard Boon-led restaurant business Hubbox, has acquired a Hampshire hotel. Henderson, who was previously a partner at private equity firm TPG, and wife Teresa, whose hospitality career includes being head of operations at high-end pubs with rooms business The Millers Collection, have taken over management of The Grosvenor Hotel in Stockbridge High Street. Their vision is to bring the hotel back to being a “high-class country hotel”. The restaurant, under the guidance of head chef Neil Cooper, serves a modern British menu featuring dishes such as roasted guinea fowl breast with pearl barley. A major renovation is under way and will be completed in phases during the next couple of years, with all 26 bedrooms already receiving a revamp. The final phase of the project will be the restaurant and bar, which will be completely reconfigured. Hubbox received a £2.2m investment from Provenance Investment Partners in 2017 to fund growth.
Staycity opens first resort-style property, near Paris: Aparthotel operator Staycity has opened its first resort-style property. Staycity Aparthotels Paris, Marne-la-Vallée comprises 284 apartments, 22 holiday villas, an outdoor swimming pool, cafe, restaurant and gardens. The new-build property offers studio and one-bedroom apartments as well as 12 four-bedroom villas and ten five-bedroom villas. The venue, the company’s second in the Paris area, is a ten-minute drive from Disneyland Paris and offers a free shuttle bus to the attraction. Staycity, which has 7,000 apartments operational and in the pipeline across Europe, will open in Berlin in November. Staycity operates under the Staycity Aparthotels brand and its premium Wilde Aparthotels by Staycity brand. The group’s growth target is to reach 15,000 apartments by the end of 2023.

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