JD Wetherspoon gears up for record year as strong Q3 driven by best ever Easter and busiest Saturday ever: JD Wetherspoon has said it is gearing up to a record year, as a strong third quarter was driven by a best ever Easter and busiest Saturday ever. In its Q3 trading update for the 13-week period up to 30 April 2023, the company said like-for-like sales increased by 9.1% in the 13 weeks to 30 April 2023 compared to the same period in the last full financial year before the pandemic, which ended on 28 July 2019. Year-to-date sales increased by 6.4% compared to the same year. Sales in Easter week were the highest-ever for the company, and sales in the current financial year are likely to be a record. Compared to FY22, like-for-like sales increased by 12.2% in the third quarter and by 12.7% year-to-date. The first weekend in May, a bank holiday, was “exceptionally strong”, including the company’s busiest ever Saturday. The second weekend, relating to the Coronation, was “slightly less strong”, with a “noticeably quiet Saturday” possibly benefitting sales in the off-trade more than the on-trade. The company employed 42,839 people as at the end of the third quarter, an increase of 940 compared to the year-end FY19. The company said: “Wetherspoon, its customers and employees generated £764m of taxes in FY19, approximately one pound in every thousand collected by the government in that year. Since sales in the current year are likely to be at record levels, taxes are also likely to be at a record high. The employment and tax contribution of the hospitality industry to the UK economy is often underestimated, or ill-understood, by the political powers-that-be. In fact, the industry contributes far more in both areas than other, perhaps more glamorous, businesses.” In the last quarter, the company opened one pub (year-to-date three pubs) and sold, closed or surrendered to the landlord ten pubs (year-to-date 21 pubs). Most of the pubs were smaller and older, or where the company has a second pub in reasonably close proximity. There was a net cash inflow of £4.7m from the 21 disposals. A total of 30 trading pubs remain on the market, or are under offer. The company currently has a trading estate of 834 pubs. As at 30 April 2023, net debt was £738m, approximately £67m lower than the company reported in its interim results for FY20, immediately before the pandemic. Since then, it has invested £185m in new pubs and freehold reversions and has raised equity of approximately £240m. The company had financial headroom of £241m at the end of the quarter. Chairman Tim Martin, said: “Lockdowns and associated restrictions have had more profound and longer-lasting consequences than most economists, politicians and commentators predicted. Sales in the last quarter have continued their positive momentum, although inflation, especially in labour, energy and food costs, remains a more intractable issue. In order to bear down on inflation, political parties should encourage free enterprise, rather than a reliance on additional regulations. A lack of understanding, among some senior politicians, about the need to encourage a successful free market economy, presents a real threat to the future prosperity of the country. The company expects profits in the current financial year to be towards the top of market expectations.”
Latest Propel Turnover & Profits Blue Book shows sector companies making collective loss of £254m, improvement on loss of £497m last month:
The next edition of the Propel Turnover & Profits Blue Book, which will be sent to Premium subscribers on Friday (12 May), shows sector companies are making a collective loss of £254m – an improvement on the loss of £497m the previous month. The Blue Book shows the total profit of the 723 companies in the list is £2,704,975,523 and losses are 2,958,555,125. The Blue Book is updated each month and ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Premium subscribers also receive access to four other databases: the Propel Multi-Site Database
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Comptoir Group reports revenue up almost 50%, reviewing franchise opportunities as new openings perform ‘ahead of expectations’: Comptoir Group, the Comptoir Libanais and Shawa brand operator, has reported a revenue increase of almost 50% in FY22 and said it is reviewing franchise opportunities as its new openings performed “ahead of expectations”. Group revenue increased 49.7% to £31.0m (2021 restated: £20.7m), while gross profit was up 44.3% to £24.4m (2021 restated: £16.9m). Adjusted Ebitda before highlighted items of £6.3m was reported (2021: £6.4m), along with a net cash position of £7.7m (2021: £7.1m). The year saw a new chair, chief executive and executive director appointed, “to significantly strengthen the senior leadership team and accelerate the company’s growth trajectory”, while two new franchise restaurants opened, in Stansted and Qatar airports. Chief executive Nick Ayrest said: “Franchising is an integral part of the group’s strategy and one that will continue to be focused on over the coming year. In 2022, two new restaurants opened in travel hubs: Doha Airport Qatar and London Stansted Airport, both through our long-term partner HMS Host. Both have performed ahead of expectations, and we continue to review opportunities both in the UK and further afield with existing and new franchise partners. In anticipation of future expansion and strategic planning we have strengthened our management structure throughout the year with key appointments in marketing, procurement and food development. While economic uncertainty and inflationary cost pressures are set to persist in the short term, we believe Comptoir Group is in an excellent position to capitalise on opportunities in the marketplace. We are in a position to open new restaurants across the different brands with an experienced and motivated leadership team to execute the group’s strategy. Comparisons to prior years are difficult due to the extended impact of covid related restrictions between March 2020 and January 2022. However, for the last six months of the financial year when compared to 2019 (that being the last comparable period of no interruption) we saw encouraging like-for-like growth, which against the backdrop of external pressures, we believe to be a good trading performance. Comptoir Group are not immune to the inflationary pressures on the hospitality industry in general and we took steps to mitigate this impact without compromising the offer to our guests. A two-year contract hedge on utilities ended in September 2022, and we fixed for another 12 months until September 2023. Supply chain management was brought in-house for the first time, with a clear strategy for control and consolidation that helped mitigate the worst of the external turmoil. During quarter four and continuing into 2023 we carried out significant menu re-engineering exercises across the group. This covered both food and drink and allowed us to offset some of the inflationary pressures and VAT increases to protect margins with only modest price increases. Our central production unit enables us to control quality and respond quickly to changing circumstances. We are back near to our optimum employment levels and have strong retention KPIs, together with improved terms and conditions for our teams. During the year we improved pay rates, bonus potential and added or enhanced other benefits such as health care as well as financial and mental well-being support. We introduced incentives relating to guest satisfaction scores ranging from mystery guest scores to Google reviews.” Dr Beatrice Lafon, non-executive chair, added: “In my first year as chair, I am delighted to be reporting that Comptoir has performed well against the well documented headwinds affecting the industry. This was a pivotal year for the group as it recovered from the challenges presented by the pandemic and was required to address unprecedented inflationary pressures on food and energy prices. Sales increased by almost 50% and underlying profit was maintained as we returned to a normalised trading position compared to the previous two years. Our Back-to-Basics programme was launched in September, improving staff retention by 10% and doubling our guest satisfaction scores. We also delivered a new menu attracting value-conscious customers. We were delighted to appoint Nick Ayerst as CEO in October. Nick brings a wealth of experience from his previous roles at Leon and The Restaurant Group. The board and executive management are focused on reinvesting in the business and its people, building strong foundations for growth.”
Liverpool’s Royal Albert Dock sold for £40m, new bars and restaurants planned: Liverpool’s Royal Albert Dock has been acquired by London creative real estate developer and investor, General Projects, and investment management company, Neo Capital, for around £40m. The 375,000 square-foot dock is made up of the largest single collection of grade I-listed buildings in England and comprises mixed-use accommodation providing restaurants, bars, shops, two hotels and a collection of SME offices, within four landmark heritage buildings. General Projects said it would seek to implement a strategy of creative activations and public realm improvements to enhance the site’s public offer and enable it to reach its full potential. It said that working with local independent operators, the complex will continue its “evolution into one of the most exciting experiential destinations in the UK with new restaurants, bars and leisure concepts set to join the estate in the coming years”. Jacob Loftus, chief executive of General Projects, said: “Already one of the busiest leisure and cultural destinations in England, we hope to add our energy and creativity to further evolve the Dock into the most exciting experiential and authentic destination in the UK. We look forward to nurturing the many exciting independent businesses on site, working collaboratively with our cultural neighbours and further activating Liverpool’s amazing waterfront.”
April saw steepest decline in recruitment of permanent staff since height of pandemic: A new survey has shown the steepest decline in the recruitment of permanent staff since the height of the covid-19 pandemic. The report, by advisory firm KPMG and trade body Recruitment & Employment Confederation, pointed to the seventh consecutive monthly decline in people placed in permanent roles. In fact, permanent recruitment activity fell at the fastest pace since January 2021, when the UK was in a covid lockdown, reports The Financial Times. Claire Warnes, partner at KPMG UK, said economic uncertainty had made businesses “cautious about committing to permanent hires”, with many announcing recruitment freezes, while others still struggled to find candidates with the right skills. At the same time, the report noted a pick-up in recruitment of temporary workers, which rose at the fastest pace for three months. The survey showed demand for permanent staff had weakened across all areas of the economy. However, the public sector was more resilient than the private, where hotels and catering were among the industries with the sharpest slowdown. Recruiters also said they were finally finding it easier to attract candidates after two years of severe staff shortages, with the increase in availability more noticeable in London than in any other region.
Keeping Pret subscription updated could help land a mortgage: Keeping up with monthly fees for a Pret A Manger subscription or gym membership could now help aspiring homeowners get on the housing ladder, as one building society will allow customers to use regular direct debit payments to help prove they can afford a mortgage. Leeds Building Society will enable prospective home buyers to have their last 12 months of direct debits taken into account as part of affordability checks. Payments to subscription services will be counted towards their credit score and could be used as extra evidence of a good financial track record. Known as Experian Boost, as part of a partnership between the building society credit agency Experian, the extra information provided could potentially tip the scales in favour of some borrowers who may have otherwise been rejected, reports The Daily Mail. Richard Fearon, chief executive at Leeds Building Society, said: “This will particularly help younger borrowers, first-time buyers and anyone on lower incomes who face the toughest challenge to prove their ability to repay. Often through no fault of their own, these groups can struggle to build a good credit score because they need to spend most of their earnings on rent and other regular payments.”