Propel Morning Briefing Mast HeadAccess Banner  
Propel Morning Briefing Mast Head Propel's LinkedIn LinkPaul's Twitter Link Paul's X Link

Kronenberg Banner
Morning Briefing for pub, restaurant and food wervice operators

Wed 16th Jan 2013 - Breaking News - Tim Martin - "We’ve upped the tempo"
Tim Martin – like-for-like sales increases flow from “upping our tempo”: JD Wetherspoon founder Tim Martin has claimed that 8% like-for-like sale increases in the most recent quarter result from the company “upping the tempo”. He told Propel Morning Briefing: “I think it’s self-evident what’s going well – sales. We’ve just been trying to up the tempo a bit in what we do.” Martin said it was “hard to isolate” the precise reasons for the sales increase but the company has been offering coffee for £1.09 and matched the price of McDonald’s on its burger offer. Asked whether the new premium style of food presentation pioneered at airport and central London sites had helped food sales, he said: “I think it all helps. The airport sites have been useful over the years – they’re a good opportunity to try something different and if it works try it elsewhere.” The company reported margin down by 1.1% to 8.2%, linked to increased marketing costs, utilities, tax and food supplies. Martin reported the increased marketing costs were related to the introduction of a new menu in the period. “We had quite an expensive menu change a couple of months ago,” he said. Simon French, of Panmure Gordon, issued a buy recommendation on the shares this morning with a 615p Target Price. He said: “Management is guiding towards 4-5% like-for-like sales growth for the full year and an Second Half EBIT margin of 8.0-8.6%. The unexpected downward pressure on margin expectations is from higher gas consumption and semi variable elements of its gas hedges working against them. This will result in the gas cost increase being £2.5-3.0m compared to previous expectations of circa £1m. Yesterday’s government proposal to increase the prize limit on Category C gaming machines (typically found in pubs) from £70 to £100 provides a further boost to the investment case (typically 5-10% sales increase) with implementation due in November 2013.” However, Douglas Jack, of Numis Securities, issued a hold recommendation and a Target Price of 525p on the shares. He said: “Margins are continuing to disappoint, falling 40bps in Q1 and by circa 150bps in Q2. With the company facing tougher like-for-like sales comparatives and additional margin pressure in H2, we are cutting our 2013E forecast by 9%. We believe the valuation is full, with earnings expected to fall and debt to rise this year. We are cutting our 2013E PBT forecast by 9% as a result of the downside from weaker margins exceeding the upside from stronger like-for-like sales.”

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
Pepper Banner
Butcombe Banner
Jameson Banner
UCC Coffee Banner
Heinz Banner
Alcumus Banner
St Austell Brewery Banner
Sideways Banner
Nory Banner
Solo Coffee Banner
Heinz Banner
Small Beer Banner
Meaningful Vision Banner
Mccain Banner
Pringles Banner
Quorn Pro Banner
Propel Banner
Access Banner
Propel Banner
Christie & Co Banner
Kurve Banner
CACI Banner
Airship – Toggle Banner
Wireless Social Banner
Payments Managed Banner
Deliverect Banner
Zonal Banner
HGEM Banner
Venners Banner
Zonal Banner
Kronenberg Banner