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Morning Briefing for pub, restaurant and food wervice operators

Fri 3rd Jan 2014 - Propel Friday News Briefing

Story of the Day:

Jongleurs set to unveil expansion plans – and catch-up on payments to comedians: The comedy club chain Jongleurs is set to unveil ambitious expansion plans – and promised to clear all the debts it owes to stand-ups who play its clubs by the end of this month. The debts have accrued in the wake of the collapse of Momo Leisure last year, which operated the brand at several of its own sites and Luminar venues on a franchised basis. A number of Britain’s circuit comics have outstanding payments stretching into thousands of pounds for gigs they performed for the business. Jongleurs’ finance director, Marios Lourides, is writing to all the affected comics with a precise plan of when they can expect to be paid. “We have drawn up a schedule of who we are going to pay and at what rate,” he told the comedy circuit website Chortle. “Everyone will be up to date by the end of January, but it’s not a blanket email, it’s been worked out on an individual basis.” Lourides also said the company would be making more announcements early this year about expanding the chain: “We have to have critical mass and we can’t do that with five or six – or even eight or nine – clubs. But we will be adding demand across the country for comedy and comedians. We want to redevelop some kind of relationship with the comedians who are the lifeblood of our business. Without them, we are nothing. We don’t want them to feel undervalued and bullied, as they may have done in the past.” Several comedians have posted letters on Facebook setting out the money they are owed for gigs last year – and vowed not to work for Jongleurs. One, Alistair Barrie, stated: “There are many experienced comedians like myself who will no longer work for you.” 

Industry News:

The first Propel Multi Club Conference of 2014 opens to bookings: The first Propel Multi Club Conference of 2014, to be held on Thursday 13 March at the Lancaster Gate Hotel, London, is now open for bookings. Multi-site pub, restaurant and foodservice companies can claim up to two free places each. E-mail jo.charity@propelinfo.com to reserve places.

Microbrewery pioneer Peter Austin dies: Peter Austin, founder of the Ringwood Brewery in Hampshire, a major mover in the setting up of SIBA, the UK’s small brewers association, and regarded by many as one of the most important influences on the microbrewery movement in both the UK and the United States, has died aged 92. While his own small brewery, now owned by Marstons, is one of the UK’s longest-lasting post-1971 brewery start-ups, Austin’s brewery consultancy business helped around 120 other breweries set up and open their doors, at home and abroad. He had been head brewer at the Hull Brewery until 1975, but left after it was taken over by Northern Dairies, Two years later he helped Terry Jones of Monty Python open the Penrhos Court brewery in Wales, one of the UK’s earliest “new” microbreweries, before founding his own new brewery, Ringwood, in 1978, aged 57. He helped found SIBA in 1980, and was its first chairman. Austin retired from Ringwood 25 years ago, aged 67. Propel Info’s managing editor, Martyn Cornell, said: “There is no doubt that Peter Austin’s skills, vision and encouragement of others had a massive impact on the early years of the microbrewery scene.” Austin died on 1 January.

Gay nightclub boss awarded MBE for service to gay community: A gay nightclub owner in Blackpool has been recognised with an MBE in the New Year Honours list. Basil Newby received the honour for services to business and the lesbian, gay, bisexual and transgender community. He told the BBC: “I kind of feel like this is for Blackpool as well as for me because I was born and bred in Blackpool. I’ve been running businesses now for 35 years, and it’s just lovely, after all that time, that something that is part of Blackpool gets recognition.” Newby worked as a bluecoat at Pontin’s in the early 1970s. His first business was the Gone Gay fancy goods shop in Blackpool. Newby opened the town’s first gay nightclub, The Flamingo, in 1979. The Flamingo building was demolished in 2007. He launched the cabaret show bar Funny Girls in 1994, described as a “Broadway musical meets rock concert meets Lily Savage”. Newby currently runs several venues in the Blackpool area.

Gamestec Leisure joins Jacques Borel VAT campaign: Gamestec Leisure, part of the Novomatic group of companies and the largest gaming and amusement machine operator in the UK, has joined VAT Club Jacques Borel. It is backing the campaign for a reduction on the level of VAT in the hospitality sector to 5% on drink and food. Jacques Borel said: “I am delighted that Gamestec has joined VAT Club JB. It has a large presence in the pub sector and understands the benefits that a reduction in VAT to 5% will bring to pub companies and individual licensees. Their inclusion within the VAT Club strengthens our position and highlights the importance of the campaign.” Gamestec’s commercial director, Peter Davies, said: “This is a vital campaign for the pub sector as well as the wider leisure and hospitality sector, and we are pleased to support its aims.”

Scotch whisky exports double in a decade: Scotch whisky exports have almost doubled in the past ten years, according to new analysis of HM Revenue & Customs figures by the Scottish government. The figures show that the value of Scotch exports increased by 87% from £2.3bn in 2003 to £4.3bn in 2012. Volume sales were up by 32% over the same period. Richard Lochhead, Scotland’s food and drink minister, said: “Scotch whisky is one of our most iconic products and these figures demonstrate the huge global demand for whisky. We export to 173 countries, from the US, which has more than doubled its spend on our national drink, Brazil and China, to Bermuda, Papua New Guinea and the Vatican.”

Company News:

Anglian reports December like-for-likes up 11.5%: The four-strong pub and restaurant operator Anglian Country Inns has reported strong trading in December. Managing director James Nye said: “December was, overall, a good month for us with like-for-likes up 11.5% for the month, 2.5% ahead of forecast. The month started slower than expected, with the real growth coming over the last two weeks. Our Hermitage Road site in Hitchin was the golden site for the month, breaking weekly and daily sales records within the group, with the Norfolk sites contributing well once the holiday period kicked in. In spite of some odd trading patterns this year, the directors were happy with the figures for the month.” Six-strong TLC Inns, led by Steve and Jo Haslam, reported 5% like-for-like sales growth. Steve Haslam said: “That was in line with budgets, although a number of sites broke records, with Grand Central Basildon leading the way with a 20% like-for-like uplift. We are very pleased – we had some soft lunches but evenings were good.” The company begins work on Monday (6 January) converting the Boathouse in Ely into its second Grand Central diner. Draft House, the five-strong London business led by Charlie McVeigh with backing from investor Luke Johnson, saw like-for-likes in December up 7% and overall turnover up by 50.8%. The company has a sixth opening close to being unveiled, with an opening scheduled for February. It is targeting growth to seven or eight sites by the end of 2014. 

Luminar – New Year’s Eve was ahead of the year before: The UK’s largest nightclub company, Luminar, has reported New Year’s Eve was ahead of the year before. Luminar’s chief financial officer, Russell Margerrison, said: “New Year’s Eve met expectations with the majority of our nightclubs across the UK recording strong advance ticket sales, with many selling out ahead of the big night. Total sales were 3% up on New Year’s Eve, with our major investments in 2013 an impressive 29% up. We are the venue of choice for young people who still enjoy a big night out for key occasions, such as New Year’s Eve, in a safe and fun environment.”

McMullen – Christmas party meals up 8%: Hertfordshire brewer and pub retailer McMullen & Co has reported strong festive trading. Managing director Peter Furness-Smith said: “We tend to judge this important trading period by looking at sales in comparable houses over a four-week period, usually to the end of this week. This tends to smooth out the vagaries such as which day of the week Christmas falls which can make a material difference from week to week in December. With Christmas and New Year’s Eve falling midweek, like last year, total sales will be much better than in a year when Christmas falls on a Friday, Saturday or Sunday! That said I can tell you the following in our comparable houses: Christmas party meals, in the lead up to Christmas, were up 8% on last year; Christmas Eve, Christmas Day and Boxing Day sales were up 14%; and New Year’s Eve sales were up 8%. We are pleased but the real measure, in my view, will be how we did over the whole four-week period.”

M&B starts 2014 with a host of deals: Mitchells & Butlers is offering a host of deal across its brands in January. A voucher campaign has launched in Harvester offering 20% off total food and drink bills on a minimum spend of £25 until 13 February. Crown Carveries customers are offered two pub classics with unlimited side servings for £6.50, on production of a voucher, until 25 January. Toby Carvery customers are offered 20% off their food bill, on presentation of a voucher, until Saturday 1 February. At O’Neill’s, a second main course is available for £1 for anyone buying a first main course at the full price. 

Antic Limited administrator considers application for failure of director in duty to co-operate: Chantrey Vellacott, the administrator of Antic Limited, the leasehold estate of London pubs formerly led by Anthony Thomas, is considering action over a failure to co-operate. The administrator, David Oprey, stated in a Companies House filing: “On 16 January 2013 I served notice on the director requiring him to a submit a Statement of Affairs (SOA). However, at the date of this report I am yet to receive it. The director instructed the company’s former accountants to assist him prepare the SOA and also prepare finals accounts for the period 1 January 2012 to the date of administration. I have been informed that the SOA and accounts have been completed. However, the director has not yet signed them. It is important that these are completed so that I can continue my investigation into the remaining assets. If I do not receive the SOA and accounts shortly, I will consider making an application to the court under Section 235 of the Insolvency Act 1986 in respect of the director for failing in his duty to co-operate with me.” 

Downing EIS extended to April 2014: The Downing Pub Enterprise Investment Scheme has been extended to 2 April 2014. So far, a total of £10.9m has been raised. Downing, which manages around £400m in funds, said: “There was a fall of approximately 30% in the average price of public houses from the start of 2008 to the end of 2009. From 2009 until the end of 2012, the rate of fall reduced to approximately 5%. [Downing] considers that there are currently good opportunities to purchase pubs at prices significantly below the peak of the market.”

Bloomberg – Young’s outpaced Fuller’s last year: Respected newswire Bloomberg has noted that Young’s enjoyed a stock gain in 2013 almost double that of London rival Fuller’s. “Our managed estate, which accounts for over 90% of group turnover, is the main driver of our growth and we don’t see that trend reversing,” Young’s chief executive Officer Stephen Goodyear said in an e-mailed response to Bloomberg questions. Young’s stock closed 2013 with a 40% gain, the biggest in eight years, outperforming Fuller’s 21% increase. Bloomberg added: “Young’s profit will probably rise to a seven-year high this fiscal year and gain the following year, according to average analyst estimates, while Fuller’s net income may slip 14% this year and gain 4.3% in fiscal 2015”.

Wetherspoon pub gets exclusive on ‘pre-industrialised’ beer: A JD Wetherspoon pub in Scotland has signed an exclusive deal with a new heritage brewery. The Guildhall and Linen Exchange in Dunfermline is the only pub in the UK selling Abbot House heritage beers. The brewery, which opened on 12 October last year, produces beer using “pre-industrialised” methods. Master brewer John Reade said: “The grain is reused in the process after the water is drained out, creating ‘small’ beer such as our pilgrim beer and also ‘strong’ beer – we have one called Benedictus.”

Gondola Holdings chief – Asian market holds great promise for PizzaExpress: Gondola Holdings chairman Chris Woodhouse has argued that the Asian market holds great promise for PizzaExpress. In his annual 2013 report statement, he said: “PizzaExpress franchise partners in the Middle East and Asia continued to see solid results, with a number of markets achieving impressive levels of sales growth. We also started to implement our longer-term strategy of identifying key markets in which we want to invest directly. India is the first of these where, during the year, we successfully opened our first restaurant in Mumbai. We have a pipeline of further sites developing in India and we are putting plans in place to launch the brand in other attractive geographies. The widespread popularity of PizzaExpress is underscored by the fact that four of the top 20 restaurants globally, ranked by sales volume, are in Asia.” 

Cluck set for March opening in Sheffield: The first site for a new rotisserie chicken concept called Cluck is due to open in Sheffield in March at the former Little Chef site on Sheffield Parkway. Behind the concept is Simon Beattie, who has previously overseen catering at top venues including the International Convention Centre, the National Exhibition Centre and the National Indoor Arena. He picked Sheffield because of its growing food focus: “Sheffield’s a vibrant and exciting city to be in,” Beattie said. “And being located right next to the Travelodge hotel, we hope to bring people back to the area again and again.” Work will start shortly to transform the building, with a stripped back theme including rustic wood and reclaimed features. Open from 7am daily, Cluck will serve a range of dishes featuring fresh meat, vegetables and home-baked breads. Rotisserie chicken, pies and “hearty” breakfasts will be a speciality.

Electrical fault blamed for destruction of Red Hot World Buffet site: An electrical fault in the ceiling is believed to be the cause of a blaze which completely destroyed the Red Hot World Buffet restaurant in Northampton. After an investigation into the fire at the restaurant in Sixfields, firefighters have concluded that it was probably accidental. At the height of the fire, eight fire engines and 60 firefighters were tackling the blaze. A spokesman for Northants Fire & Rescue said: “The mostly likely cause is due to an electrical defect in the ceiling above the men’s toilets.”

Tesco faces opposition over plan to convert former Greene King pub: Tesco is facing opposition to plans to open a branch in Goring, near Henley in Berkshire. The supermarket wants to open an Express store at the former Queen’s Arms in Reading Road, a former Greene King pub. The pub closed last month and was then sold by Greene King, which said the business was “unviable”. Rumours of Tesco’s plans began spreading around the village in December and a banner with the slogan “No Tesco here” was attached to security fencing around the site. Tesco says it does not own the property but had been given the option to lease it.

Starbucks to open site in symbolic Irish bank: Starbucks is to take over part of the former headquarters of the Anglo Irish Bank. A section of the building, at 18-21 St Stephen’s Green North, in central Dublin, will be transformed into a coffee shop. The building became a symbol of the economic crisis after the bank was forced to take more than €30bn of taxpayers’ money.

Local consortium takes over Bangor nightclub: A local consortium, Bangor Business, has taken over the Embassy nightclub in Bangor, North Wales with a view to maximising its potential through day-time use. A Bangor City councillor, Chris O’Neal, who is also a member of the new venture, said: “We were made aware that the nightclub would be going on the market and that an opportunity was there to take over the running of the Embassy. Unfortunately, the venture had not worked out as well as the previous owner had hoped but we believe there is a need for more than one late-night venue in the city. However, we also want to maximise the venue to its fullest potential, so want to be in a position to screen big sporting events in the daytime.”

Chop and Wok launches iPhone app: Chop and Wok, the Birmingham-based pan-Asian restaurant group, has launched its own iPhone app, designed to make ordering easier and improve the service to customers. Chop and Wok, which sells noodles, soups, curries, sushi, salads and wraps using Chinese, Indian, Thai, Malaysian and Japanese flavours, currently has six outlets, after opening a flagship store in Westminster late last year. Aman Bhandal, a director at Chop and Wok, said the decision to launch the app came after an increase in online orders. It is hoping the app will boost orders still further, possibly by around 5%. Once the free app is downloaded from the company’s website, customers are greeted with a map marked with Chop and Wok’s sites, including two in Birmingham city centre and others in Shirley and Sutton Coldfield. When a store has been selected, an overview of its contact details, delivery times and collection times is shown. Customers can then go to the menu options, where they can begin ordering. Future plans include introducing gaming and other types of functionality.

Whitbread lines up Premier Inn, Brewer’s Fayre and Costa at the same site: Whitbread is lining up a development in Llanfoist, near Abergavenny that would include a Premier inn, Brewer’s Fayre and Costa Coffee. The proposal, by Johnsey Estates UK, is to open a 61-bed Premier Inn, a Brewer’s Fayre pub and a Costa Coffee café on land off Merthyr Road, known as the Westgate site. The application, which has been submitted to Monmouthshire council, includes a small Costa Coffee with 21 parking spaces, which would be built on four hectares of the site, in conjunction with the hotel and pub which are all part of the Whitbread chain. The council’s tourism manager, Nicola Edwards said that, based on national tourism data, a 61-double room hotel development could deliver an additional £2.25m spend in the area, with users visiting the town centre.

Pensioner wins Starbucks pay-out: A pensioner who tore her hamstring when she slipped on a spillage at Starbucks has won a four-figure payout from the coffee chain. Staff at the coffee shop had already been warned by a customer about the hazard on its greasy floor. Rosemarie Duggan ripped her muscle and was unable to walk without crutches for 14 months after falling at the coffee shop at Bescot Retail Park in Walsall, in the West Midlands. After her lawyers launched legal action, Starbucks accepted full liability for Duggan’s injuries and has now agreed to a four-figure compensation package, out of court. 

Papa John’s to open first outlet in Cumbria: Pizza chain Papa John’s is to open in a former solicitors’ office in Carlisle, subject to planning permission, making the American company’s first outlet in Cumbria. The new restaurant, in Warwick Road, will be the chain’s 225th UK branch. The premises have been empty for two years. It will be competing against Domino’s, which already has three branches in Cumbria, in Carlisle, Kendal and Barrow, and which has been advertising for premises in Workington and Penrith. Papa John’s has said it wants between 400 and 500 outlets in the UK.

Microbrewer appoints Carlsberg man as sales chief: Box Steam Brewery has appointed David Southway, Carlsberg UK’s sales director for the South and South West for eight years, as its new sales director. Box Steam, which is based in Holt, near Trowbridge, Wiltshire, said Southway will lead its sales team. The brewery owns two pubs, and currently supplies more than 100 other outlets.

Finding talent biggest challenge for family firms says JW Lees boss: The biggest challenge facing Britain’s three million family firms is finding talent, according to William Lees-Jones, managing director of the Manchester-based brewery and pub owner JW Lees. Lees-Jones said the key strength family firms had, compared to rivals, was in being agile. “Family-run businesses are able to make the right long-term decisions when competitors are looking for short-term solutions/profits,” he said. However, he said, the greatest challenge was “talent – where to find it (inside the family or outside the family) and when to step down, as well as the attitude to change.” Lees-Jones was speaking in advance of a conference on family firms in the north west of England organised by Insider Media later this month. 

Kettering club is converted into a tandoori grill and pub: A former Kettering social club has been converted into a tandoori grill and pub. Jeet Chahil, Jas Somal and Bindi Singh took over the former Miniature Rifle Club, in Bath Road, about six months ago. The new pub, called The Miniature Indian Grill, opened before Christmas, although at first only the bar will be operating – with the tandoori grill expected to fully open in a few weeks.

Varsity Bars buys 18 Bramwell sites: Varsity Bars, a new company incorporated at the start of last month and led by Michael Holder, has acquired 18 former Bramwell Pub Company sites out of administration. The portfolio includes sites in Accrington, Bangor, Cardiff, Cheltenham, Chepstow, Chesterfield, Chester-le-Street, Grimsby, Leek, Liverpool, Plymouth, Prestwich, Southampton and Wisbech. In Scunthorpe the company has acquired the high street’s biggest bar, the 650-capacity Abacus. Christian Kent, the area manager for Varsity, said: “We have exciting plans for the Scunthorpe business. The emphasis will be on providing good service and something different for our customers. We are also planning a refit in 2014 and a change of name from Abacus to Varsity. The mixture in Scunthorpe will be on different food, live music and entertainment.” Of the Varsity Bar in Plymouth, another acquisition, Kent said: “It will stay as Varsity at least until Easter when it is to have a refit and rebrand. What was frustrating from my point of view was, we were one of the top performing sites in the company. We were victims of the other poor-performing sites and the company not managing the situation. We had 17% growth when we were shut down”. Stonegate Pub Company bought 78 sites from Bramwell in November but passed on the opportunity to take on Plymouth’s Varsity. Kent said he was under the impression that Stonegate, which already owns six premises in the city, did not want to create more competition for itself. The administrators at Zolfo Cooper revealed last month that Bramwell Pub Company collapsed owing creditors £23.3m. Secured creditors are likely to be left being owed £10.4m and unsecured creditors £12.7m. Trade creditors are owed a total of £9.1m. Among the biggest creditors are Matthew Clark Wholesale, which is owed £926,000; Carlsberg UK, owed £496,000; Heineken, owed £443,000; Sky, owed £153,000; Brake Brothers, owed £132,000; and Bibendum Wine, owed £126,000. Agent Christie + Co is selling 102 Bramwell sites in the wake of Stonegate buying 78 venues. The 67 include eight Varsity sites, Cape in Nesham Street London, The Longroom in London, and all three Wild Lime Bar and Kitchen sites. The highest turnover site is the Abbey in Liverpool, which had turnover of £1.05m in its most recent year.

EIS launches soar in 2012: Businesses raised £1.02bn through the government’s Enterprise Investment Scheme (EIS) in the year to the end of March 2012, up from £545m in the previous year, according to latest figures from HMRC. Almost 1,500 businesses used EIS for the first time last year, raising more than £1bn in funding. One example is No Saints, the nightclub business headed by former Luminar boss Stephen Thomas. He told the Telegraph: “EIS was very attractive because it made investing in No Saints accessible even for investors who only wanted to invest small or moderate amounts in the business. Whether they wanted to invest a finger or a hand, EIS offered our funders an attractive risk-return profile.” No Saints has raised £6.7m through three separate funding rounds since inception, of which £3.1m was eligible for EIS relief.

Developer fails to overturn restaurants plan refusal: A developer has failed in a bid to overturn Highland Council’s decision to refuse planning permission for new restaurants at a retail park. Inverness Estates had sought permission in principle for the sites at its Inverness Retail and Business Park. However, the proposals were rejected by Highland Council .The company’s appeal against that decision has now been dismissed by a Scottish government-appointed planning official. Frankie and Benny’s, McDonald’s and Chiquito’s were interested in occupying three of the four planned premises.

Whitworth Hall Hotel sold off £1.25m guide price: The 29-bedroom Best Western Whitworth Hall Hotel and Country Park in Spennymoor, near Durham, has been sold to the family of its former owner. Derek Parnaby Cyclones International, a nearby engineering business owned and managed by Adrian Parnaby and his family, has acquired the property out of administration, off a guide price of £1.25m, saving 40 jobs. The late 19th century Grade II-listed hotel was taken over nearly three months ago by administrators Begbies Traynor after the death of the hotel’s managing director, Alan Lax. It was sold by Colliers International.

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