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Morning Briefing Strap Line
Thu 20th Jun 2013 - Draft House, Greene King and Maxwell’s

Story of the day:

Spirit to add two more premium sites after success of the first: Spirit Pub Company will open two more premium pubs after the success of its first, The George in Belsize Park. Chief executive Mike Tye told Propel that the openings are subject to planning permissions but Spirit would now trial its premium format in different types of locations. He said: “It’s going really well at The George – we’re really pleased. We got most things right at The George but you always learn a few things. The George doesn’t have the best pitch so the way it is performing is very encouraging. There are loads of sites we want to do and two are waiting on planning consent.” Tye revealed that the variable weather had resulted in extreme impacts on like-for-like sales in its most recent quarter with some cold days down by as much as 20% in like-for-like terms and warmer days pushing sales up 15 to 20%. Tye said there was no difference in performance between different Spirit brands, a contrast with Mitchells & Butlers which had reported that its value brands are seeing the most challenging part of the market. There is, though, a north/south difference in performance although “it’s not all one-way” with well-invested, well-positioned sites doing well “whatever the concept”. Tye said Spirit is focused on “putting the whole of the business right” at the moment, but he expected the company’s free cash would start to be directed towards acquisitions in the next financial year.

Industry news:

Liverpool restaurant wins Good Food Guide’s top restaurant award: Delifonseca, the restaurant, deli and food store based on Liverpool’s dockside, has been crowned The Good Food Guide Readers’ Restaurant of the Year. Delifonseca impressed the judges with its modern, holistic approach combining both restaurant and delicatessen offerings. Elizabeth Carter, consultant editor of The Good Food Guide, said: “With the façade of a classy little supermarket, this all-day restaurant may seem an unconventional choice for The Good Food Guide Readers’ Restaurant of the Year winner. But with a flexible menu of tasting platters, salads and sandwiches and a daily changing blackboard of seasonally charged dishes, this enticing café-deli is contemporary dining at its very best. We had to agree with Delifonseca’s many supporters, it’s one hell of an all-rounder; a passion for quality mixed with affordability and a something-for-everyone appeal chimes perfectly with the mood of these straitened times. And they could give many of the grander restaurants a lesson in how to do warm, welcoming service.”

Wine and spirit sales still feeling the duty pinch: Total alcohol sales continue to fall according to the latest Wine and Spirit Trade Association market report, which shows the duty escalator continuing to impact negatively on the sector. The quarterly report shows that volume sales in the off trade were down 3% for the year and 3% in the last 12 weeks, while on trade sales were down 3% for the year and 2% in the last 12 weeks. For wine, volume sales in both the off and on trade were down 1% in the short term, while spirit sales for the year were down 2% in the off trade and flat in the on trade. Despite the fall in volume growth, total alcohol prices were up by 2% in the off trade and 4% in the on trade for the year. This was largely down to the duty escalator, which increased duty on wines and spirits by a further 5.3% in this year’s Budget. The WSTA Market Report draws on data and analysis from Nielsen, CGA Strategy and the Wilson Drinks Report.

Londoners enjoy development of food-through-a-hatch offers: The London Evening Standard has reported that noodles, sandwiches and pies are now all available served from small hole-in-the-wall operations in areas such as Shoreditch, King’s Cross and Soho. While offering something new to Londoners, running a hatch also puts independent operators on a “level playing field with the large chains”, restaurant property consultant Adam Hyman told the newspaper. He added: “These new hole-in-the-wall sites allow independents to trade from the same postcode or even the same street without spending the big money. The London food scene is also in an informal food revolution and Londoners now want these semi-permanent street food operators in central locations. It is a win-win situation.”

Northampton councilors vote against EMRO: Police plans to impose a ban on early hours alcohol sales in Northampton have been blocked by the town’s borough council. An increase in crime between 3am and 6am was the reason behind the call for an Early Morning Restriction Order (EMRO). Alcohol would have been banned in the town centre between those times within an allocated “leisure zone”. But the borough council’s licensing committee voted against the scheme.

Company news:

ALMR chief executive’s pub wins TripAdvisor Certificate of Excellence: The Punch Taverns pub operated by the chief executive of the Association of Licensed Multiple Retailers, The Devonshire Arms, in Baslow, Derbyshire, has won a TripAdvisor Certificate of Excellence. The award is only given to the top ten per cent of venues in the world. David McHattie, who has previously worked for Mitchells and Butlers, Fuller’s and The Restaurant Group, said: “We’re delighted with the award which recognises the hard work of the excellent team led by my co-founder Gary Hodgkisson at The Devonshire Arms.” McHattie and Hodgkisson formed a new company called Inn Ideas Ltd to re-launch The Devonshire Arms, just around the corner from Chatsworth House, last July. The venue, which saw a £375,000 joint refurbishment with Punch, is a new concept called Inn & Kitchen that also incorporates a tea, coffee and cake offer called Hattie’s. David McHattie is presenting at today’s Propel Multi Club Conference at the Oxford Belfry on integrating the learnings from customer service benchmarking and net promoter principles into the retail offer at The Devonshire Arms.

Amber Taverns lifts average site Ebitda to £109,000: Community pub operator Amber Taverns, which is backed by LGV Capital, has lifted average site Ebitda to £109,000 – it stood in the low £90,000s two years ago. The company has previously targeted an estate of 100 community pubs each producing site Ebitda of £100,000. Chairman Clive Preston told Propel that a couple of its more recent developments are producing site Ebitda in excess of £200,000. Preston also reported that Amber has evolved its acquisition focus and is now buying and investing in more city centre circuit and high street sites, spending around £550,000 each on acquisition and development compared to £500,000 spent on Amber schemes around two year ago. “We spend £6m each year on buying and refurbishing properties. We are buying slightly fewer but bigger sites, still targeting between ten and 15 openings a year. We think there has been underinvestment on the high street but there has been underinvestment generally in the pub industry. There are a couple of sites where we have spent less on the refurbishment than buying but it is usually the other way around – buying a pub for £200,000 and spending £300,000 on a refurbishment to create a wow factor. We receive enquiries from would-be managers all the time – quite a few come from good managers of failed tenancies where the numbers didn’t work out for them.” On future plans, Preston said: “100 pubs has always been my target and we will get there some time next year. Perhaps the next number is 200 – we’re all happy to carry on as we are.”

Draft House unveils soft opening dates for sixth site – and on-site smoker: Craft beer pub group Draft House is planning a soft opening for its sixth site between 25 and 28 June when all food will be half-price. The venue is a former Novus Leisure site on Seething Lane, London. Founder Charlie McVeigh said last month: “Draft House Seething is just across the river from our most successful site on Tower Bridge Road, so when this came up we jumped at the opportunity. We look forward to serving the local shipping and insurance communities as well as a goodly portion of the 1.4 million annual visitors to the Tower of London.” McVeigh added yesterday: “Over the last few months we have been scrambling to turn it into a Draft House and it is now really starting to take shape. Unsurprisingly there will be a massive range of beer, a short but pertinent wine list, as well as sensational hamburgers, steaks and other health-food items. We have also installed our very own smoker and will be producing all manner of delicacies in there, not least a supremely mellow version of the Carolina’s pulled pork bun – our current best-seller. We have bagged some big new-oak barrels and will be ageing our own spirits mixes behind the bar and have created three new cocktails: The Old Oak Fashioned, The Millionaire and Daddy Mack’s Ginger Mash. This last one is named after my great grandfather who famously liked a pale Bloody Mary.”

Marston’s to invest £7.4m in bottling plant: Midlands based brewer and retailer Marston’s is to invest more than £7 million in new bottling plant, creating 15 jobs. The company is investing the money in its Shobnall Road brewery as a result of the increasing number of people buying alcohol to drink at home. The £7.4 million project also includes creating extra storage and capacity at the brewery. Emma Gilleland, head of supply chain at the firm, said: “This is a timely investment for Marston’s at a time when our bottled beer volumes are in tremendous growth. Our current line is operating at full capacity, with some volume being contracted out in the busy periods. The new line will allow us greater flexibility for our bottled beer portfolio, as well as bringing employment to the town with around 15 new jobs.”

360 Champagne & Cocktails chain plans 12 new openings: Buchanan Galleries is to become the first shopping centre in Glasgow city centre to open a champagne bar as part of a dozen planned openings by champagne bar specialist 360 Champagne & Cocktails. Katherine Armstead, Land Securities senior portfolio manager for Scotland, said: “This is an exciting addition to Buchanan Galleries, which adds another aspect to the shopping experience. 360 Champagne & Cocktails has a successful track record and we look forward to the bar opening later this summer.” 360 Champagne & Cocktails successfully launched its first bar in the Trafford Centre, Manchester in July 2011, followed by the opening of our second bar at Metrocentre, Gateshead, with a further eight openings planned in the current year.

Greene King adds Bury boutique hotel to expanding Old English Inns estate: Suffolk-based Greene King has added a boutique hotel in Bury St Edmunds to its expanding Old English Inns estate. The company is taking over six-bedroom The Fox Inn in the town’s Eastgate, which has been run by Ron and Sheila Blackmore for nine years. A Greene King spokesperson said: “The Fox in Bury is a fantastic pub and we think it is a good fit within our Old English Inns division.” The Blackmores added the site’s six boutique bedrooms in 2008 after converting a former barn in a state of disrepair. The most recent ten TripAdvisor reviews have all given the site five marks out of five.

Carlsberg hires M&B man to front external communications: Brewer Carlsberg UK has appointed Andrew Roache as its new external communications manager, with responsibility for all corporate communications, corporate sponsorships and events. Roache joins from Mitchells & Butlers, where he held the position of external communications manager for six years. Roache replaces Joanna Dring, who has been promoted to international brand PR manager for the Carlsberg Group in Copenhagen, where she will be responsible for the brewer’s international brand PR campaigns for its wide portfolio of brands, including Carlsberg, Tuborg, and Somersby.

Wetherspoon – RAC survey doesn’t even spell our name correctly: A RAC survey has found only 12% of consumers support the propose JD Wetherspoon pub to be built next to the M40 at Beaconsfield services. A RAC spokesman said: “This decision seems to be at odds with common sense. This is a risk and, frankly, unnecessary move. The temptations to drink and drive can only be increased by easier access to alcohol.” A JD Wetherspoon spokesman pointed out that the survey might be taken more seriously if the RAC had spelt the company’s name correctly.

Maxwell’s reports turnover and profit up: Maxwell’s, the Covent Garden burger restaurant owned Brian Stein, has reported turnover and profits up in its most recent year. Turnover rose to £26,841,2337 in the year to 29 October 2012 from £24,285,946 the year before. Pre-tax profit rose to £2,335,626 from £2,052,753 the year before. The company said: “2012 was another successful year for the company. Beauquest was acquired in March 2012 and has been successfully incorporated into the group, contributing both sales and profits. The London Olympics were not as successful as many had predicted and the general economic position remained difficult, but through careful management another profitable result was returned.” Maxwell’s was formed in the early 1970s, when “it was nigh impossible to find a decent burger or grill in London”. Stein opened Maxwell’s Hampstead before expanding into Covent Garden in the 1980s.

Living Ventures to open bar linked to its Australasia restaurant: Living Ventures is to open a new bar in Manchester linked to its modern Australian restaurant Australasia. The Grand Pacific Bar and Garden will open on 1 July directly behind the Armani store in the city and serve a cocktail-focused drinks menu. A discreet staircase will connect the bar to the Australasia restaurant.

Elgin streets grid-locked as KFC drive-thru opens: Streets were gridlocked in the Scottish town of Elgin on Monday as customers formed long queues in their cars outside the newly-opened fast-food outlet. More than 1300 people had joined a Facebook campaign for KFC to be brought to Elgin, Moray. The scenes echoed the road chaos encountered by drivers in Edinburgh when Scotland’s first Krispy Kreme doughnut shop opened in February. Plans for the new KFC were submitted in 2010 but had been delayed by work on flood defences for the town.

Famous Brands reports another tough year for Wimpy in the UK: South African restaurant company has reported that Wimpy United Kingdom experienced another challenging year and reported a 9% decrease in revenue. Operating profit declined 28% to R5 million. The operating profit margin was 6.5%.The company said: “This division comprises a very small component of the business, making only a nominal contribution to group revenue and operating profit, namely 3.3% and 1.2% respectively. The group is currently preparing for the maiden launch of our Steers brand in the UK market, in Clapham, London, scheduled for July 2013.”

Beautiful Pubs evolves Leicestershire pub offer: Beautiful Pubs, the Leicestershire-based multiple operator lead by former Orchid executive Sam Hagger, has evolved the offer at its Rutland & Derby pub in Leicester. The company has removed the pub’s delicatessen area and formed a visible wine and beer cellar as well as open coffee station outside of the bar area. Hagger said: “Our recent investment into The Rutland & Derby reflects our confidence in the business – it’s a great pub in a great city.” The Rutland & Derby’s new food offer is now described as metro version of its sister pub The Forge Inn with all menus written on giant tombstone chalkboards around the venue featuring pub tapas, daily breads, stone-baked flatbreads and other dishes from charbroiled ribeye of beef to chicken katsu curry. All doughs and breads are baked in house and all ingredients are sourced from ethical producers and suppliers.

Work starts on £18m Liverpool hotel: Work has started on an £18m project to convert Liverpool’s Royal Insurance building into a new hotel. The city council has bought the freehold from local developer Highneal for £1.95m in April to help bring forward a hotel scheme. Runcorn developer Ashall Property will now restore the grade II-listed property on the corner of North John Street and Dale Street which has been empty for 20 years. It is hoped it will open late next year as a 116-bed four-star hotel operated by Glasgow-based BDL Management as Aloft Liverpool, under licence from the US group Starwood Hotels & Resorts.

Quantock Brewery reaches £100,000 target through Crowdcube: Quantock Brewery, based in Wellington, Somerset, has reached its target of raising £100,000 for 40% of the equity in the business through crowd-funding website Crowdcube. In fact, the brewery has raised £104,130 from 119 investors in return for 41.65% of the total equity. Quantock’s Wills Necks 4.3% was awarded ‘supreme champion’ at the Society of Independent Brewers’ Association Beer X awards. The company has 50 regular pub customers within a 20 mile radius and wants to increased this to 300 within a 60 mile radius throughout the south west.

Chicago Group buys ten Atmosphere sites out of administration: More than 250 jobs have been saved after a new company acquired ten sites out of the former Atmosphere Bars and Clubs, which fell into administration in May. Chicago Group, which is led by Christian Rose, former Atmosphere chief executive, has bought the package from administrator Deloitte, which has been running the business since May. The site acquired by Chicago Group includes nine Chicago’s site – in Basildon, Chelmsford, Hanley, Kings Lynn, Norwich, Stevenage, Stourbridge, Stratford-upon-Avon, and Windsor – and a Modello restaurant in Yeovil. Deloitte closed 14 of the original 24 Atmosphere sites in the weeks after administration. Rose said: “We are really excited about the potential of these venues. With the right additional investment in team members, sales and marketing, and, of course, the fabric of the venues themselves, I know that these venues have a very bright future. It’s been a difficult time for staff at these sites and elsewhere in the company. But I’m delighted that we have been able to secure the future of these ten venues and would like to thank the staff for their dedication and hard work during a difficult period.” Rose added that Chicago Group has plans to develop the customer proposition within the estate going forward. The first priority for the new company will be to build on the success of the Chicago’s party packages and launch Christmas party menus.

Work to start on £170,000 Spirit conversion to John Barras: Spirit Pub Company is to invest £170,000 converting a Norwich pub, The Prince of Wales pub, in Prince of Wales Road, into a John Barras pub, due to re-open on 12 July. The investment will also see the pub fitted with HD televisions, new furniture, a refurbished bar and revamped toilets, while the sports area of the new pub will include three TVs and a dartboard.

Restaurateurs open Carlisle’s first juice bar: Carlisle’s first dedicated juice and smoothie bar will open its doors next month. Pressé Juice, which will also have an art gallery, will be run by Paul Higgins and Julie Simpson – who have the Pompeii Steakhouse on Annetwell Street. Simpson said: “We have spotted a gap in the market and decided to go for it. We will be making proper fresh smoothies and juices where the fruit is juiced in front of you. We’ve got some fantastic recipes and we just can’t wait to try them out.” Pressé Juice will also sell healthy takeaway food.

Niche Food and Drink to launch Rosebery Bakery in Islington: Niche Food and Drink is to launch the Rosewood Bakery in Islington in July. Fleurets acted on behalf of the landlord. Meanwhile, Vinteca has bought the lease of a site on Chiswick’s Devonshire Road for its fourth site and the first to be located in a suburban area. Fleurets acted on behalf of the former tenant.

East Lancashire Railway opens real ale pub: East Lancashire Railway has opened a real ale pub called Buffer Stops at Rawtenstall Station. The Buffer Stops reflects Rawtenstall Station’s role as East Lancashire Railway’s northern terminus on the 12-mile line. The new pub offers five hand pumps with changing local and national ales and one hand pump with real cider, as well as a range of continental beers and traditional pub snacks.

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