Propel Morning Briefing Mast Head Propel Hospitaliity website Paul's Twitter Link Subscribe Unsubscribe Web Version Forward Email Star Pubs & Bars Banner Morning Briefing Strap Line
Mon 20th Apr 2020 - Propel Monday News Briefing

Story of the Day:

Sector faces another crucial week as Gove confirms it will be among last to reopen: The UK’s hospitality sector is facing another key week with it preparing to lay out its case for further government support, as cabinet office minister Michael Gove confirmed pubs, restaurants and hotels will be among the last to reopen when the coronavirus lock-down is relaxed. When asked on BBC's Andrew Marr show whether they could reopen before the winter, Gove replied: “Areas of hospitality will be among the last to exit the lock-down, yes that is true.” Gove’s statement came as Jonathan Downey, chief executive of London Union and founder of the Hospitality Union initiative, will this week submit a formal proposal to the Treasury for further support for the sector, including a nine-month rent-free period for businesses forced to close because of the coronavirus outbreak. As part of the submission, Downey will set out a number of reasons why hospitality and leisure are special cases for government support. He will state: “We were first hit and hardest hit. We’ve been forced to close by government order. We’ll be the last allowed to reopen. We’ll be the last to get back to any kind of normal. We’re one in ten of the UK’s employees. We are vital social and cultural centres at the heart of cities and communities.” Downey said: “We’re all terrified of what happens after the Coronavirus Job Retention Scheme tap is turned off. It was good to see the scheme extended to the end of June but a month won’t make much difference and, if the free money is going to run out soon, why does every business (including Victoria Beckham’s) need to benefit? The financial support should be targeted to those sectors that need it most. We need it most. Also, did we really need another 80%? We've seen what that's led to. Few will thank me for suggesting this but it should have been reduced to 60% and been made sector specific so the hardest-hit and last-to-get-back-open can benefit longer. I would much rather have four more months of 60% than three months of 80%. As well as a #NationalTimeOut, we’re going to need that level of support for that length of time.” Many pubs and restaurants withheld rent payments during the last quarter payday on 25 March as sites remain shut. Last month the government banned landlords from evicting tenants if they miss rent payments during the lock-down. However, this does not prevent property firms from demanding money through enforcement action. According to UKHospitality, 95 tenants, including chains, have already been issued with statutory demands since the lock-down began three weeks ago. Speaking in the Sunday Telegraph, chief executive Kate Nicholls warned the government risked undoing all its business support measures. Downey’s proposal will be signed by sector chief executives and senior figures and backed by UKHospitality. It will set out the reasoning for pushing back rent from April to December 2020 to the end of leases. Downey’s #NationalTimeOut proposal will also cover landlords, applying a corresponding nine-month period on their loan repayments where the debt is secured on premises benefiting from the rent postponement. One of Downey’s landlords, Canary Wharf Group, told him it was unable to accept his request for a nine-month rent and service charge free period until the end of the year, due to “our own financial obligations and bank covenants”. However, on his #NationalTimeOut and #NationalRentFree initiatives, the landlord was supportive, saying: “We are aware of the initiative you have created, which we hope will be successful.” 

Industry News:

Byron boss Simon Wilkinson to feature in next ‘navigating the coronavirus’ interview: In the latest of Propel's video interviews with leading operators about how they are “navigating the coronavirus crisis”, Propel insights editor Mark Wingett talks to Simon Wilkinson, chief executive of better burger brand Byron, about reassessing the work already carried out on turning around the brand; assessing funding options; how the future may look for the business; and its backers Three Hills Capital’s interest in Carluccio’s. The video will be released on Monday (20 April). Meanwhile, readers can support independent sector journalism and get their news 12 hours early (at 7pm each night) with a Propel Premium subscription. It costs £395 plus VAT per annum for operators and £495 plus VAT for suppliers. Email to sign up.

BBPA – pubs will need at least three weeks’ notice to reopen: The British Beer & Pub Association has argued pubs will need a minimum of three weeks’, but ideally four weeks’, notice for the lifting of the lock-down restrictions to allow them sufficient time to prepare to reopen. It said brewers will also need this period to scale-up operations to start re-supplying pubs and the on-trade. This time-frame would also enable pubs to give sufficient notice to furloughed staff they are required to return to work. It would also ensure equipment and systems are operating and cleaned to necessary standards, as well as enabling the clearance of pub cellars and the replacement of beer. The BBPA said this would in turn require some relaxation of social distancing measures ahead of a full reopening in order clearance crews could operate effectively. The economic value Britain’s beer and pub sector provides, and the hundreds of thousands of jobs it supports, will remain in a precarious position if the lifting of lock-down for pubs isn’t done right, said the BBPA, which is why it has already begun outlining its plans. Chief executive Emma McClarkin said: “The reopening process for the pub trade will be enormously hard and it’s imperative the government works with the trade to get it right, else the situation would see even more pubs close. We want to work collaboratively with government to ensure society and the economy gets back on its feet in a safe and sustainable way once the medical and scientific advice indicates a reopening is appropriate and with appropriate support in place. We believe pubs have a key role to play in this, but reopening them must be done in the right way, which is why we are leading on these plans to get pubs ready for when the lock-down is lifted.”
Yapster extends free service scheme until end of July: Mobile messaging app Yapster has extended free use of its “Underdog” offer until the end of July. Hospitality companies with more than 100 staff on furlough can sign up to use Yapster’s instant messaging for free so their teams can stay connected throughout the coronavirus crisis. During this time there is no obligation to buy and companies can avoid Yapster’s standard commercial charges by cancelling during the 30 days between the end of the crisis and the end of the “Underdog” offer. Yapster said it has a bit of a waiting list due to the volume of recent uptake, but operators can still sign up via Chief executive Rob Liddiard said: “This is the time to build relationships and a reputation to last a lifetime – well past the end of coronavirus. We're less interested in this summer's licence fees than who we'll be enjoying a beer and trip down memory lane with in 2045.”
Yapster is a PropelBeatTheVirus campaign member

Britain’s appetite for hot food delivery may have peaked: Britain’s appetite for hot food delivery may have peaked, according to new research from CGA. The research found while a third of consumers said they had ordered delivered restaurant or takeaway food during lock-down, with another 11% planning to, there was suggestion there has been no change in demand since pubs and restaurants were closed. The CGA BrandTrack survey of 5,000 consumers was carried out from 11-16 April, with comparisons being made with similar CGA consumer research undertaken in mid-March, when again 33% said they were using delivery. Also, the proportion of consumers who now don’t plan to order delivery has risen to 56%, up from 47%. CGA research and insight director Charlie Mitchell said: “What will be disappointing for those setting up new delivery services is the latest research shows the proportion of adults planning to use delivery services, but yet to do so, has actually dropped since last month, down from 19% to 11%, while the number that have used delivery has remained static.” However, of those committed delivery users, more than half (53%) are either first time or existing customers ordering more often. These consumers also look like they are willing to take these habits into a “new normal” world post-lock-down. Of those who ordered delivery for the first time, or more often than usual, 60% said they would continue their frequency of ordering delivery from restaurants, and 70% from takeaways. More than a third (37%) also said they were likely to order delivery from pubs and bars in the future, if available. Although more restaurant and pub operators have set up delivery options since the coronavirus crisis hit, Mitchell believed the apparent stalling of delivery demand may in part be down to the number of high-profile high street brands that had significant delivery businesses pre-lock-down having closed operations on safety grounds. “If these larger players start up again, we may see delivery start to grow again,” he added.

NTIA receives backing from more than 200 tenants and landlords in bid to freeze economy: More than 200 tenants and landlords have backed The Night Time Industry Association (NTIA) in its bid to get prime minister Boris Johnson to freeze the economy. The NTIA has proposed all financial commitments to banks in terms of mortgages, loans and financial agreements be frozen, without effect on any current covenants or balances in terms of interest. It said commitments would be reinstated once the coronavirus (covid-19) crisis period ends. The NTIA argued such measures would give landlords the financial freedom to allow tenants to get back to business after a period of economic hibernation. NTIA chief executive Michael Kill said: “It is fantastic to receive such unprecedented support from so many landlords and tenants across the UK. While the government has come an enormous distance at the very difficult time, we run the risk of losing a huge amount of our businesses who cannot afford and often do not qualify for further debt in addition to their losses due to the covid-19 shutdown. Landlords and tenants are all businesses that UK plc relies upon. This is now urgent.”
Raymond Blanc hires lawyers after insurer Hiscox declines to pay out: Raymond Blanc has hired lawyers after being denied a pay-out by the insurer Hiscox, The Sunday Times has reported. Blanc, who owns Brasserie Bar Co, has had to close all 37 of his pubs and restaurants due to coronavirus. The chain, which employs 1,400 staff, took out business interruption insurance from Hiscox, which covers damage caused by “an occurrence of any human infection or contagious disease” provided a local authority was notified. “We are eager to reopen — we have a good, solid business that we have grown over 20 years,” said Blanc. Hiscox has said its policies were not “designed or priced to cover the extraordinary circumstances” caused by the coronavirus pandemic.

Job of the day: COREcruitment is working with a collection of quality leisure venues that are looking for a hands-on senior leader with exceptional operations skills. The operations director will join the chief executive and lead operation excellence, financial growth and people development as well as preparing strategically for future growth. Experience with experiential or entertainment-based leisure venues as well as knowledge of quality food and beverage operations is preferred while director level experience is essential and as well as being able to commute to the Midlands and the North west. Anyone interested can email with their CV or profile. 
COREcruitment is a Propel BeatTheVirus campaign member

Company News:

Tortilla plans to reopen selected sites from next month: Tortilla, the Quilvest-backed fast-casual Mexican concept, has started planning for the reopening of some of its sites for delivery and takeaway only from next month, Propel has learned. The Richard Morris-led business shuttered its entire 42-strong estate on 23 March, but has started to engage with staff and suppliers about reopening up to 12 of its sites. KFC, Burger King and Pret A Manger recently reopened selected sites for delivery only and more operators are understood to be considering following their move. Morris told Propel: “We feel it’s time to get moving again, albeit in a few locations with strong delivery and take away trade. To reopen a hibernated business takes time and process, so this will get us moving as the lock-down hopefully softens over the coming months. Employees and customers will be the priority, so we will be maintaining social distancing in all restaurants.”
Liberation Group unveils tenant support package: Channel Islands and West Country-based brewer and retailer Liberation Group has unveiled a series of measures designed to support its tenants. The company said it would not collect any rent for the duration of pubs being closed for a maximum of six months. Meanwhile, 50% of headline rent will be cancelled while further measures will be available on an individual basis, which could include long-term deferral of the outstanding rent subject to conditions. Liberation Group said its support was in addition to that offered by the government, which the company was helping tenants access. Tenanted pubs managing director Christine Oxford said: “Our priority is to ensure our tenants not only survive this period of closure but they come through this in a strong position to continue to trade with us in the future. With this in mind we have agreed a significant package of support with the Liberation Group board.”

Pizza Pilgrims reopens Victoria site for delivery, expands meal kits offer: Pizza Pilgrims, founded by brothers Thom and James Elliot, has reopened its restaurant in London Victoria, for delivery only, as it also expands its meal kit initiative to now be available nationally. The business, which shuttered all sites last month, has reopened the Victoria site for Deliveroo orders. It will also be used to prepare its Frying Pan Meal Kits, which it originally trialled last month. The group has put in place a number of systems to make sure social distancing rules are adhered to and to make sure staff are safe. Those who are working have also been given a budget to get taxis to and from work, so they can avoid using public transport; personal protective equipment and hand sanitiser is provided for staff and delivery drivers; while a contactless system has also been set-up for drivers collecting orders from the site. The business has also expanded its Frying Pan Pizza Kit offer, which was available to order through Deliveroo from all of its restaurant sites, to now being available nationally. The kits provide enough dough, tomato sauce and toppings to make two pizzas at home.

Knead Pubs boss reports good support from Barclays, releases hotel rooms for NHS staff: Knead Pubs, the operator of six award-winning pubs and a hotel, mostly located in south Lincolnshire, has reported good support from Barclays. Founder Michael Thurlby said: "We felt we needed a £300,000 loan to see us over this period. I approached our relationship manager at Barclays, Mark Smith, and he obtained this for us in under a fortnight. We have always maintained a strong relationship with him, meeting regularly so he knows, understands and trusts our business. I think this is so important and sometimes overlooked especially when most want to criticise banks. On a separate note, we decided to release some of our rooms at The Crown Hotel to our local NHS. So far we have a young nurse staying with us because she can’t go home due to a member of her family having a very low immune system after treatment. She is from a Stamford family who we wanted to support throughout this difficult time. We also have an anesthetist who was social distancing from her family by sleeping in the study and the director of Peterborough City Hospital’s intensive care unit, who desperately needs to catch up on sleep after working such long hours. We did this by getting an email to the hospital’s ‘powers that be’, saying we would like to help as many NHS staff as we could at this hugely stressful and difficult time.”

Goodbody – Whitbread has access to almost £2bn to see it through ‘long period of distressed revenues’: Goodbody leisure analyst Paul Ruddy has said Whitbread has access to almost £2bn to see it through a “long period of distressed revenues”. Whitbread has confirmed it is eligible for the government’s Covid Corporate Financing Facility, although it has yet to access funds. Ruddy said: “The group has a BBB/F2 Fitch rating. This should entitle it to issue paper of up to £600m. In addition the group has highlighted it has accessible cash reserves of £400m and access to £900m of its existing committed revolving credit facility. These balances were as of 16 April so presumably after quarterly rent was paid. Combined, this means Whitbread has access to almost £2bn of facilities that will see it through a long period of distressed revenues. The quality of its asset base and lowly geared balance sheet is a key positive as the sector navigates this difficult period.”
Hollywood Bowl raises £10.9m in share placing: Hollywood Bowl Group, the UK’s largest ten-pin bowling operator, has raised £10.9m in a share placing to help strengthen its finances. The company placed 7.5 million shares at 145p each, representing a premium of 1.4% to the closing share price of 143p on Thursday (16 April). It represents 5% of the firm’s issued capital. Major shareholder Aberdeen Standard Investments acquired in excess of 800,000 shares for £1.2m while executive team members subscribed for circa 63,000 shares between them. Chief executive Stephen Burns said: “The funds will further strengthen our balance sheet, which we believe will enable us to emerge from this period of significant disruption in a robust financial position.” At the end of March, Hollywood Bowl had cash of £15.6m and £30.3m of debt, drawn from its £35m facility. On 2 April, the company said its lenders agreed a £20m extension to its revolving credit facility resulting in the group having £11m undrawn under its facility as at 8 April.
Travelodge calls in restructuring experts: Travelodge has drafted in restructuring experts as Britain’s second-biggest hotel chain haemorrhages cash amid the forced closure of most of its sites, reports The Sunday Times. It added: “Lenders that own the chain of 570 hotels across the UK have hired the investment bank Moelis and the accounting giant Deloitte to thrash out deals with its landlords, which have been asked to grant rent-free periods. Travelodge has closed all its hotels, except 48 kept open for key workers and vulnerable people. The company failed to pay its quarterly rent bills last month, telling landlords its ‘comprehensive plan to stabilise the business’ included asking them to suspend payments.”
M and Gaucho restaurants to provide 1,000 meals per week for NHS staff: M and Gaucho restaurants have partnered with the Hildon Foundation and Deliveroo to deliver 1,000 meals per week to Guys, St Thomas and The Nightingale hospitals in London. A selection of prepared high-quality meals from the M and Gaucho menus will be provided at both lunchtime and dinner for front line workers. The 1,000 meals are designed by M culinary director Mike Reid, and will include some of both brands’ favourite dishes and be delivered to coincide with shift start and end times. All meals will be accompanied by a bottle of Hildon Water. M is also holding a fully complimentary “Appreciation Dinner” for 200 NHS front line doctors and nurses and their partners on 28 September at its Threadneedle Street site. Partners of NHS workers who have lost their lives during the pandemic will also be invited.
Signature Living puts Liverpool hotel into administration: Aparthotels developer and operator Signature Living has put the Shankly Hotel in Liverpool into administration. Matthew Ingram and Michael Lennon, of Duff & Phelps, have been appointed as joint administrators of the Signature Shankly, which is the firm holding the leasehold interest of the site. Ingram and Lennon said the rest of Signature Living, run by Lawrence Kenwright, was unaffected and they expected the hotel to open when the lock-down was lifted. Signature Living stated: “We have been left with no option but to place the property subsidiary of the hotel into administration. The impact of this pandemic on our business has forced us to make some immediate and difficult decisions. The operating company remains completely unaffected. It will be business as usual for the Shankly Hotel as we are fully committed to our staff, suppliers, future events and guests. We look forward to opening as soon as it’s safe to do so.”

Return to Archive Click Here to Return to the Archive Listing
Punch Taverns Link
Return to Archive Click Here to Return to the Archive Listing
Propel Premium
Heineken Smart Dispense Banner
Jagermeister Banner
Ritual Banner
Biffs Banner
Peak-Ryzex Banner
Trail Banner
Fetch Banner
Wagestream Banner
Accolade Wines Banner
Zonal Banner
Bizimply Banner
Jagermeister Banner
Lucky Saint Banner
StoreKit Banner
McCain Banner
Taylors of Harrogate Banner
Chika's Banner
The Vegetarian Butcher Banner
Zonal Banner
Taylors of Harrogate Banner
Harri Banner
Lifebuoy Banner
Eagle Eye Banner
Interiors UK Banner
Ei Group Banner
KAM Media Banner
Veneers Banner
Access Banner
Prestige Purchasing Banner
IOL Banner
COREcruitment Banner
Startle Banner
Bums on Seats Banner
Pago Banner
Punch Taverns Link Punch Taverns Link
Ritual Banner
ALMR Web Link Web Version Unsubscribe Subscribe Propel Info website