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Fri 18th Aug 2017 - Sector like-for-likes up 0.6% in July, restaurants slightly outperform pubs
Sector like-for-likes up 0.6% in July, restaurants slightly outperform pubs: Britain’s managed pubs and restaurants saw collective like-for-like sales up 0.6% in July compared with last year, the Coffer Peach Business Tracker has revealed. There was little difference between trading inside and outside the M25, with London ahead 0.5% compared with a 0.7% like-for-like increase for the rest of the country. Restaurant chains just edged ahead of pub groups in performance, showing a collective 0.9% like-for-like growth rate against 0.4% for pub and bar operators. “It’s an essentially flat market out there, with the modest 0.6% growth rate exactly the same as we saw in June,” said Peter Martin, vice-president of CGA, the business insight consultancy that produces the tracker in partnership with Coffer Group and RSM. “Despite all the media talk of fragile consumer confidence, it appears the British are continuing to go out to eat and drink as much as they did last year, which is good news. However, the increased cost pressures operators across the sector face this year, particularly from increases in business rates and food costs, means margins are being squeezed and businesses are feeling the pinch. Operators have been looking for efficiencies but also increasing prices to mitigate rising costs. According to CGA’s latest Business Confidence Survey this summer, more than 80% of operators have introduced at least some price rises this year, with a third implementing them across the board. These latest trading figures show those rises haven’t stopped the public spending, but neither have they significantly boosted income for operators. It remains a tough market.” Total sales growth in July among the 37 companies in the tracker cohort was 3.7%, reflecting the continuing if more subdued effect of new openings over the year. The underlying annual sales trend shows sector like-for-likes running at 1.6% ahead for the 12 months to the end of July. Trevor Watson, executive director, valuations, at Davis Coffer Lyons, said: “The market is essentially stable, with little dynamic movement in any of the sub-markets, geographically or by sector. The good weather in July should have benefited wet-led venues, which makes the relatively strong figures from the restaurant sector encouraging.” Paul Newman, head of leisure and hospitality at RSM UK, added: “These latest figures will be greeted with a degree of relief by operators. Despite household budgets becoming increasingly stretched, consumers continue to indulge in eating and drinking out. We’ve seen businesses that develop exciting and affordable concepts outpacing competitors and attracting investors keen to support ambitious roll-out plans.”

UK food and drink exports grow 8.5% to £10.5bn, highest first-half value on record: Total exports of food and drink grew 8.5% in the first six months of 2017 compared with last year to reach £10.2bn – the highest first-half value on record. The UK’s top three export products were whisky, salmon and beer, according to the Food and Drink Federation (FDF) report. It said contrary to recent export trends, stronger growth was reported to EU countries (+9.0%) than to countries outside the EU (+7.6%). Ireland, France and the US were the top three destinations for UK food and drink in terms of overall value. Positive growth was reported in all top 20 markets apart from Spain and Japan. The three export markets that saw the greatest percentage growth in value in the first half were South Korea (+77%), China (+35%), and Belgium (+39%). The rapid growth in exports to growing east Asian markets was led by South Korea, which is fast gaining a taste for British beer, while overall exports surged to £156.3m. The FDF said that while the fall in the price of the pound had helped to boost UK export competitiveness, this currency weakness has also led to an increase in the cost of many essential imported ingredients and raw materials. This had resulted in the UK’s food and drink trade deficit increasing by 16% to -£12.4bn in the first half of 2017.

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