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Wed 26th Jul 2017 - Update: McDonald’s, Marston’s, Burning Night Group, Hollywood Bowl
Steve Easterbrook – McDonald’s UK saw highest sales volume in 43 year history in April: McDonald’s chief executive Steve Easterbrook has reported sales and guest numbers grew in all of its top nine markets in its Second Quarter – the first time since 2008. The UK saw a record performance in April. He told analysts: “We had a solid quarter, driven by guest count growth. We grew global comparable sales 6.6% and global guest counts 3%, resulting in strong earnings growth. This demonstrates the progress we are making with our business today. Our strength was broad based, as we grew sales and guest counts in every one of our top nine markets for the first time since 2008. Here are just a few highlights from around the world to illustrate this momentum. Italy experienced its best quarter guest count since 2010. In April, the UK saw the highest monthly sales volume in its 43 year history. Germany had its strongest quarterly comp sales in nearly ten years. Canada’s sales growth was the highest in the last five years. And in the Netherlands, a market that’s becoming a more meaningful part of our overall business, we had our best comp sales and guest counts in more than 20 years. Our most important priority remains growing guest counts by serving more customers, more often. This is the ultimate measure of our turnaround as we strengthen and grow the business. We’ve talked before about the extensive research we conducted that gave us a much greater appreciation for who our customers are and what appeals most to them. Guided by that insight, we’re taking purposeful actions to retain customers who visit us today. We’ve gained lapsed customers and convert casual customers to committed customers. Our second quarter results demonstrate that customers are responding as we serve hotter, better-tasting food, offer convenience on their terms and provide good value for their money.”

Marston’s reports benefit of warm weather: Marston’s has reported like-for-like sales in its Destination and Premium division for the 42 week period to 22 July were 1.3% ahead of last year. In the most recent 12 weeks of the period, like-for-like sales were up 0.6% which continues to be ahead of the market. The company stated: “As we previously guided, operating margins are slightly below last year in line with our expectations. With regard to the cost outlook for 2018 our guidance remains unchanged from that provided at our Interim results in May. We remain on track to meet our growth targets for 23 new pub-restaurants and bars in the current financial year in addition to eight lodges. In Taverns, like-for-like sales for the 42 week period were 1.9% ahead of last year, with growth of 2.4% in the last 12 weeks of the period, principally reflecting the benefits of the warm weather in June. In Leased, profits for the 42 week period are estimated to be 2% ahead of last year. In Brewing, own-brewed beer volumes were up around 4% compared to last year reflecting the continued good performance of our underlying business and the benefits of the acquisition of Charles Wells Brewing and Beer Business. The integration of the business is proceeding as planned.” Chief executive Ralph Findlay, said: “We remain encouraged by our continued market outperformance and focused on delivering sustainable growth and maximising return on capital in an evolving market place. Our transformed pub estate continues to deliver positive like for like growth across all three divisions. We benefit from an operating structure which spans food-led destination and wet-let community pubs, accommodation and brewing, maintaining a good balance within our brand portfolio and broad consumer appeal. The Charles Wells brewing and beer business is bedding in well, further underpinning our leadership in the UK ale market. We are on track to complete our new-build and lodge expansion plans. We remain confident of delivering further profitable progress for the full financial year.” 

Burning Night Group hits £7m crowdfunding target: Bar company Burning Night Group has hit a £7 million target to fund ambitious expansion plans just three months after launching a crowdfunding campaign. The company owns the Bierkeller, Shooters and Around the World three-venues-in-one concept, which already has six city sites across the country, and operates a growing number of Potting Shed and FirePit bars and restaurants. After generating more than £4 million through an initial Crowdstacker appeal, reaching the first million within days of its launch, Burning Night Group set itself a new investment target of £7 million in April. Now, after just three months, strong support from backers has seen that achieved and the company is keen to invest the capital in to creating new venues. Burning Night Group currently employs more than 500 people and had a turnover in 2016 in excess of £17 million. Its multi-brand sites and themed bars and restaurants have proved so popular that the company is keen to add to its portfolio. The Crowdstacker Peer to Peer loan (P2P) was chosen as a way to involve customers in the business’s future growth and a potentially inflation-beating return of 7% gross per annum, for a minimum investment of £500 over a three-year term, clearly made it an attractive proposition. With monthly closings for investment, money going in to the fund is put to work straight away, allowing it the opportunity to earn interest and show a potential return after a maximum of four weeks. Allan Harper, chief executive of Burning Night Group, said: “To reach that kind of sum, especially in the current economic climate, shows a fantastic response to our campaign and the faith that investors have in us as a company,” he added. “We are committed to expanding our brands, creating new opportunities and jobs, and building on the tremendous success we’ve already achieved. This huge investment can allow us to do that, and for many of our customers to be a part of it.” Karteek Patel, chief executive of Crowdstacker, said Burning Night Group’s campaign demonstrated a post-Brexit trend for supporting home-grown businesses especially by younger investors. He explained: “We believe British businesses are proving appealing, and the entertainment and leisure sector is a strong one for investment right now, so we believe those aspects combined with Burning Night Group’s track record has obviously made it a very popular choice.”

Hollywood Bowl announces renegotiation of two leases: Hollywood Bowl Group, the ten pin bowling company, has announced the successful renegotiation of lease arrangements at two centres, alongside good progress in its refurbishment and rebrand programme. The company stated: “At Stevenage, the landlord regards Hollywood Bowl as a partner of choice for the site, with the centre continuing to perform very well for the group. As such, we have agreed and signed a 25 year extension to our lease, taking our tenancy out to 2046. This provides us with the ideal location in this town and future certainty on a strong leisure park. We have also received a rent-free equivalent of circa eight months. In Tunbridge Wells, we have a close relationship with the landlord and we are excited by their outlook and plans for the retail park and the key role that our centre will play in this. Accordingly, we have signed a 14 year extension to the site, taking our lease out to 2037, and in return we have received a rent-free equivalent circa eight months. Hollywood Bowl Group continues to make good progress against the refurbishment and rebrand programme outlined in our half-year results. Cwmbran has now been rebranded to a Hollywood Bowl, whilst our centre at Bentley Bridge has undergone a £300k refurbishment. At these centres, although it is early days, we are seeing good returns on investment in-line with what we have seen in the wider estate (c.46%). We have also now completed the refurbishment of our centre in Ashford, and Tolworth will be completed this week, with both being rebranded to Hollywood Bowl. Looking ahead, we plan to refurbish and rebrand Tunbridge Wells in September 2017 and we are on track for our 58th centre to open in Dagenham in late September 2017.” Laurence Keen, chief financial officer, said: “We are pleased to have further strengthened our property portfolio. We have now successfully completed the refurbishment or rebrand of 55% of our estate and we continue to build strong relationships with landlords right across the UK. Stevenage and Tunbridge Wells are two of our most popular centres, and the successful renegotiation of their rent agreements reinforces the attractiveness of Hollywood Bowl Group as a key leisure tenant.”

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