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Thu 10th Dec 2020 - Update: Marston's, Starbucks, Applegreen and Pub of the Year
Marston's – ‘we are singularly focused on operating a great pub business’: Marston's has reported its pubs traded at 90% of 2019 levels in its fourth quarter of a 53-week period that ended on 3 October – this was 7% ahead of the overall pub sector. Sales dropped to £821m from £1,173.5m the year before – and there was a loss of £22m compared with a profit of £95.1m the previous year. The company has made a £2m investment in “Inside-Out” schemes to increase capacity in winter months. Chief executive Ralph Findlay said: 
“2020 has been an extraordinarily difficult year for the pub and wider hospitality sector, which has been particularly hard hit by the pandemic. I would like to thank the entire team at Marston’s for their loyalty, dedication and hard work in such trying circumstances. While short-term uncertainty remains, we have taken swift action to future-proof the business to withstand the challenges presented by the pandemic and Marston’s has emerged a significantly stronger business, with a substantially strengthened balance sheet and well placed to rebuild trading momentum when restrictions are eased. The roll out of the vaccine is clearly critical to that, but in the meantime the sector continues to face major challenges and government support will need to continue in order for many viable businesses to survive. Looking forward, Marston’s has entered the current year fit for the future and excited about the next chapter in the company’s development as a focused pub and accommodation operator. We look forward to realising the potential of the group’s brewing joint venture with Carlsberg and wish the team every success. There is clear evidence consumer demand for our pubs remains strong and our geography, as a predominantly community pub operator with 90% of our well invested, high-quality pubs located outside city centres, leaves Marston’s well placed to leverage the market opportunities available to us over the medium to longer term.” On current outlook, the company added: “Following the recent government announcements on the tier system and criteria, the winter months will be both challenging and uncertain and 780 pubs remain closed after the November lockdown. Our experiences from the spring helped us to swiftly and efficiently respond to the constantly moving restrictions imposed since the year end, with pub teams furloughed where appropriate, and the cessation of all non-essential spend. In addition, we have been able to minimise the extent of stock losses given the slightly longer notice period. During the period of closure our focus is on the future. Following the disposal of the beer company into the joint venture with Carlsberg, we are singularly focused on operating a great pub business. The initial lockdown provided an opportunity to review all parts of our business, from improving commercial efficiency through to development of technology. In this current period of shutdown, this gives us an opportunity to further develop and evolve those plans, ensuring we are well placed to take advantage of the significant trading opportunity that will emerge as restrictions are eased. Looking forward, the outlook does look more positive. The prime mnister has strongly intimated restrictions will ease in the spring and there is increasing confidence an effective vaccination programme can be implemented. Our circa 90% freehold pub estate is predominately located outside of the challenged city centres and our experiences of trading since 4 July demonstrate consumer demand is strong – our guests want to go out and socialise and we are confident they will do as soon as they are permitted. Importantly, with the development of the vaccine, the more vulnerable groups, who are a key part of our business, should have more confidence in returning to pubs. Finally, and most importantly, we have an incredible team at Marston’s. We have worked hard to protect as far as possible the livelihoods and well-being of our team members and our tenanted, leased and other partners. Our focus on ‘doing the right thing’ for our people will pay dividends – we have a loyal, hardworking group of people eager to welcome our guests back into our pubs and again provide them with great experiences.” 

Applegreen reports negotiations over offer that represents 48% premium: Applegreen has reported it is in advanced discussions with a consortium including B&J Holdings and Blackstone Infrastructure Partners in relation to a possible cash offer for the company at a price of €5.75 per share – a 48.2% premium to its closing price on Wednesday (9 December). The company stated: “B&J Holdings is a 41.3% shareholder in Applegreen and represents the holdings of Applegreen's founders, Robert Etchingham and Joseph Barrett. Should the transaction proceed, B&J Holdings would retain a significant equity stake in the consortium and Robert Etchingham and Joseph Barrett would maintain their current management positions as chief executive and chief operating officer respectively within the business. The independent board believes the possible cash offer, if effected, would represent a compelling opportunity for shareholders in Applegreen to realise their investment at an attractive premium to the prevailing share price.”

Starbucks to build more ‘walk-thru’ locations: Starbucks chief executive Kevin Johnson has said the company plans to build “walk-thru” locations without seating in major cities. After efforts to expand US suburban drive-thru locations, the company is creating a similar experience for customers on foot. Orders are to be primarily digital, paid for in advance, as the company shifts to new store formats in response to changing habits. “What we’re trying to do is build the equivalent of a drive-thru in a dense metropolitan area, which I think of as a ‘walk-thru’,” Johnson told Reuters. In the US, the stores are called Starbucks Pickup. In mainland China, the chain’s fastest growing market, they are called Starbucks Now and will make up 10% of the 600 stores it plans to open there in the next year. For future growth, Johnson said Starbucks will lean on artificial intelligence – a suite of products Starbucks calls Deep Brew – to give store managers an edge in how they run their locations. The goal is not to displace employees, but to have them focus on customer service instead, he said. The technology can create staff schedules and automate inventory management. It is already used to generate personalised deals for Starbucks Rewards members. And Starbucks is using artificial intelligence to assess local covid-19 cases, customer preferences and employee sentiment in order to recommend, on a store-by-store basis, whether and how to slowly reopen locations. “We’ve got a way to navigate through this virus,” he said. “And certainly as vaccines come and we start turning up the dial, I have no doubt in my mind the customer response coming to Starbucks is immediate, because we have seen it as we open up limited seating.”

Olive Branch in Clipsham named UK Pub of the Year: The Olive Branch in Clipsham in Rutland has been named as overall UK Pub of the Year by the Good Pub Guide 2021. A Good Pub Guide spokesman said: “In this most difficult of years, we are delighted to award Pub of the Year 2021 to The Olive Branch in Clipsham, Rutland. To compete in the Pub of the Year category a pub has to have unanimous enthusiasm from all readers on all aspects of its business – it has to be top of its game and The Olive Branch is most definitely that. It’s a really special place for a drink, a meal or an overnight stay. It’s a perennially successful inn that attracts a deservedly loyal following from both near and far, and will celebrate its 21st anniversary on 12 December.” 

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