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Morning Briefing for pub, restaurant and food wervice operators

Thu 17th May 2012 - April Trading, Restaurant Group and Marston's

Story of the day:

Restaurant Group – new brand Coast to Coast showing “superb performance”: The Restaurant Group has reported that its like-for-like sales have been boosted by poor weather in recent months. For the first 19 weeks of its financial year, total sales were eight per cent ahead of the previous year and like-for-like sales were four per cent ahead. The company was expected to benefit from having lots of sites in leisure parks – Cineworld reported yesterday that movie attendance was up during the below par weather of recent months. And the company will now push ahead with the expansion of new brand Coast to Coast after a superb performance of the first in Brighton marina. The company said: “In November 2011 we opened our first Coast to Coast restaurant, alongside an existing Frankie & Benny's restaurant at the Brighton Marina. Coast to Coast is a new TRG brand, which we have been developing over the past two years. Our intention with this brand was to create a unique restaurant offering that has scaleability and which will complement our existing Frankie & Benny's and Chiquito brands. The performance of our first Coast to Coast restaurant has been superb and we are particularly pleased with how well it is complementing the existing Frankie & Benny's restaurant located adjacent to it. As a result, we have now committed to two new Coast to Coast sites, which will open later this year. We are also exploring further site opportunities for new Coast to Coast restaurants.” The company expects to open between 25 and 30 new restaurants this year with a strong pipeline developing for 2013 and beyond. The company’s AGM is held later today.

Industry news:

Bad weather hit sales in April: Poor weather hit sales across the eating and drinking-out market in April, according to latest Coffer Peach Business Tracker data – with pub and restaurant groups seeing collective like-for-like sales down 2 per cent for the month. Pubs, and in particular drink-led businesses, were worst hit, although high street casual dining restaurants saw sales increase against the same month last year. “As ever, the weather is a major factor in where, or whether, people choose to go out and eat. In general, if it’s sunny people go to the pub; when it’s wet restaurants tend to benefit,” said Peter Martin of Peach Factory. “Last April, not only did we have hotter weather, but we had the Royal Wedding and Mother’s Day in the month, as well as the Easter holidays. That benefited the market overall last year, but pubs and pub restaurants in particular,” added Martin. Total sales in April this year were, however, up by 1.9 per cent on 2011, reflecting the effect of new openings. The Coffer Peach Tracker industry sales monitor for the UK pub and restaurant sector collects and analyses monthly performance data from 24 operating groups. “Despite the fact that bad weather was a major dampener and April 2011 was an especially good month in comparison, with like-for-like sales up 3.8 per cent on 2010, operators will nonetheless be disappointed with the results. The market remains volatile and these figures cancel out the modest bounce-back in out-of-home food and drink sales seen in March, after a very shaky start to 2012 in January and February,” added Martin.

Suzy Jackson accepts permanent job at Hospitality Guild as executive director: Former Punch Taverns director of central operations and recruitment Suzy Jackson has accepted a permanent position at the newly formed Hospitality Guild as its executive director. The Hospitality Guild is a new umbrella body that will take a lead on skills development within the hospitality industry. Jackson, who oversaw a revamp of central operations and recruitment at Punch before leaving last year, has taken charge of strategy and engagement at the new body. She was originally on a six-month contract but has now accepted a full-time position. The Hospitality Guild will represent larger employers, SMEs and 2.2 million employees within the hospitality sector. The aim is turn the Hospitality Guild into a united voice for increased professionalism in the sector. It brings together a dozen existing professional bodies and associations, including the BII, the National Skills Academy for Hospitality, People 1st and Springboard UK.

Manchester pubs and restaurants receive £4m boost: Pubs and restaurants are estimated to have received a £4m boost after tens of thousands of fans and visitors flocked into the city twice this week. Fans watched the two Manchester game in pubs and bars and then flocked into the city to watch the Premier League trophy parade. Paul Simpson, managing director of Visit Manchester, said: “The economic impact for the city centre is expected to be just over £4m, as thousands of football fans descend on the city centre and spend money in the shops, bars and restaurants.” Manchester's city centre management company said Sunday afternoon's dramatic finale to the season saw footfall into Manchester increase by 11.6 per cent compared to the same time last year. Phil Burke, spokesman for the Manchester Pub and Club Network, said: “Sunday night's victory saw Manchester's food, pub and bar sector in particular at its busiest this year. “The victory parade was exactly what the city needed to give the trade a much-needed uplift on a weekday. “May is going to be a strong month for the pub sector. We started the month off with the football derby, followed by the bank holiday weekend and then the parade.”

2,000 people sign the Beer Duty escalator petition in a day: A total of 2,000 people signed the e-petition calling for an end to the beer duty escalator in a single day. The total number of signatures has topped 45,000 – almost halfway to the 100,000 needed to prompt a parliamentary debate.

Four cups of coffee a day could extend life: A study has found that drinking four or five cups of coffee a day could have health benefits. Over the period of a 14-year study into the effects of coffee, women who consumed four or five cups of coffee were 16 per cent less likely to die than non-coffee drinkers. Men drinking the same amount were 12 per cent less likely to die. A total of 400,000 subjects were involved in the study. 

Fat content in sandwiches varies enormously: Consumer watchdog Which? has found that a sandwich from a retailer can contain twice as much fat as a sandwich from a second retailer. The watchdog has argued that a traffic light packaging system, with “simple green, amber or red colour coding of nutrient levels” is required to give customers clarity.

Free Report: Paul Charity has written a report on menu trends, the drivers of US dining occasions, the franchise business model and other key areas of the US foodservice market and their significance to the UK market. The report, based on a visit to the National Restaurant Association show in Chicago, is produced in conjunction with the Association of Licensed Multiple Retailers and sponsored by CPL Training. It is free and is available by e-mailing Paul Charity on

Company news:

Marston’s reports robust trading in all divisions: Wolverhampton-based brewer and retailer Marston’s has reported underlying profit up 14.7 per cent to £33.5m for the 26 weeks ended 31 March. Managed like-for-like sales were up 3.6 per cent while tenanted and franchised operating profit was up 3.1 per cent with an “improving trend”. Brewing revenue increased by 6.6 per cent and operating profit was up 2.7 per cent. The company will complete 25 new-build pubs this financial year, continuing to achieve strong returns with an EBITDA return of 18.5 per cent. The company reported an 11 per cent increase in main meals served, with food sales now representing 43 per cent of retail sales. Franchised pub developments now apply to 419 pubs. Chief executive Ralph Findlay said: “We have delivered a good performance in the first half year against a weak consumer backdrop.”

Gary Neville’s Old Trafford hotel approved: A plan by former Manchester United star Gary Neville to build a £20m hotel near Old Trafford has been given the go-ahead by planners. Neville wants to build the 139-bed hotel and supporters club with proceeds from his testimonial match last year. His former club objected, claiming the scheme on the site of a former lard factory undermined the "holistic vision" of its "strategic plan" for the area. However, planning councillors backed the scheme. Construction is expected to start in January 2013 with the hotel open for the 2014-15 season.

Two London pubs becomes the first to switch to vegetarian only: Two pubs in London are thought to be the first to switch entirely to vegetarian menus. The two pubs, The Coach & Horses in Soho and the Smithfield Tavern, have made the switch after a trial. Landlord and co-owner Alastair Choat said: "We need to be more responsible, more sustainable and lose the ridiculous prejudices and negative attitudes towards vegetarian and vegan food. We feel that offering food that is better for our environment and customers is a vital first step towards becoming a more sustainable business."

Pub owners open second beer shop: The owner of a real ale pub Ship & Mitre have opened a second shop selling speciality beer from around the world. The Liverpool pub, in Dale Street, already runs a Ship in a Bottle in Whitechapel in the city centre. Now its owners have opened a second Ship in a Bottle in a former off-licence on Grange Road on Friday, which will sell 300 bottled beers from around the world. The shop has teamed up with award-winning Birkenhead-based Peerless Brewing Company to hold a beer tasting event today (May 17). Ship & Mitre owner Ben Garner said: “We just like the area and it fits with what we do in the pub.”

Loungers to open 24th site next week: Loungers, the café bar chain headed by Alex Reilley, opens its 24th site next Wednesday (23 May). The Verdo Lounge opens in Wylde Green Birmingham. The site will be the 21st Lounge venue – the company also runs three Cosy Club sites. Bosses have been looking for new sites in York, Harrogate and Nottingham this week.

Enterprise Inns reports rise in pubs with rents linked to RPI: Enterprise Inns has reported that the percentage of the pubs within its substantive estate whose rents are linked to RPI has increased by five per cent in the past year. A total of 66 per cent of pubs in its substantive estate now have rent linked to RPI compared to 61 per cent a year ago. The company also reported that the average length of publican occupation is “consistently over five years” and the number of enquiries about letting an Enterprise pub was 1,400 in its first half-year, only marginally down from 1,452 for the year before.

London nightclub part-owned by Guy Pelly forced to close: Public, the London nightclub on Chelsea’s King’s Road part-owned by Prince William’s friend Guy Pelly, has been forced to close after failing to overturn a licence revocation. Last May, Kensington and Chelsea council ordered the nightclub to bring forward its closing time from 2am to midnight. This came after neighbours complained about club-goers fighting, urinating, vomiting and having sex in the streets. Police called the venue the “No 1 crime generator” in the borough at a licensing meeting. 

Pie & Pint Inns boss in talks to export beer: Gary Downham, the boss of Pie & Pint Inns, which operates Punch Taverns’ Hare at Roxwell, near Chelmsford, Essex, is in talks to export a beer made for his pub, Golden Crust, to a US pub operator. Downham is understood to be in negotiations with The Tavern Restaurant Group, which runs 15 large-scale pubs in Kentucky and Florida. In March, Downham turned down a proposed £8m investment that would have seen the company grow to 27 sites. Downham is looking for an investor to help him roll out the concept after his pub turned over £1m in its first year. Downham acquired the lease of the Punch pub for £50,000 and spent £350,000 on a refurbishment of the site, which offers “very traditional, freshly prepared British fayre”. The unnamed investor offered to inject £8m into a roll-out that would have seen nine Pie & Pint country pubs, nine Pie & Pint town pubs and the creation of nine Café Crust sites, which is a town centre café concept based loosely on the American Panera Bread format but with Italian influences. It is thought that Downham turned down the investment on the basis that it would have left him with too small a share of the company.

TFI Friday landlord retires: Landlord Andrew Carey, who featured for five years as the barman in Chris Evans’s TFI Friday and runs The Haverstock Arms, Belsize Park, is retiring from the pub trade after 27 years. He said: “Gastro pubs and sports bars are what are doing well now. Since I’ve been here, we’ve had 21 pubs close in Hampstead, Belsize and Kentish Town. In the last 15 years the government have put massive duty on drink - and the price supermarkets are charging, I can’t even buy it from the brewery for that. It’s sad for publicans and the trade.” 

Chicago Rib Shack sells Kensington site: Chicago Rib Shack, the company headed by Christian Arden, has completed the sale of its Kensington site after receiving a “fabulous offer” for it. It is understood the site has been sold to Buddha Bar. Chicago Rib Shack is also close to agreeing terms on two more food court sites in Leeds and West London. Arden told Morning Briefing that its first food court site, in Westfield, Stratford, is “trading well”. 

Hotel group MWB sells its Bistro du Vin restaurants: Marylebone Warwick Balfour has sold its two Bistro du Vin restaurants in London which were opened last year. The sites in Soho and Clerkenwell have been sold to Burger and Lobster for £1.2m. In the 18-month period to June 2011, the two Bistro du Vin restaurants generated a loss of approximately £330,000.

Carlisle businessman set to open fourth site: Carlisle businessman John Van Lierop is to re-open a Carlisle eatery as a fine-dining restaurant. Loaf ‘n’ Ladle in Friars Court, off Lowther Street, closed last year and is being given a refurbishment by Carlisle businessman Van Lierop. It is set to re-open by the end of this month as Cafe du Monde. Van Lierop already owns the successful Gilded Lily and Thin White Duke bars, and Concrete nightclub. He said: “We will be offering light lunches and fine dining in the evening.”

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