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Thu 24th Aug 2017 - Deltic Group reports like-for-like sales up 3.85%
Deltic Group reports like-for-like sales up 3.85%: The Deltic Group, the UK’s largest operator of premium late-night bars and clubs with 58 venues across the UK, has reported like-for-like sales are up 3.85% so far in its current financial year. The company saw turnover for the year to 25 February 2017 increase 1.4% to £102.2m compared with £100.8m the year before. Underlying Ebitda was in line with the prior year at £13.3m. Admissions grew 6.8% while pre-booked sales rose 47%. The company stated: “The view of the board is that fundamental to running a successful late-night operation is the investment in the estate, including its management and staff and the consumer experience. Four years ago the average age of the estate since refurbishment was in excess of six years, which in the board’s opinion will have contributed to a declining trading performance. The group is targeting an average payback time of two years for investment in its venues, with the board requiring a minimum 40% return on investment for any capital projects on the existing estate and 33% return on investment on new developments to ensure sufficient profitability is generated from any investments. By the end of 2016 three quarters of the estate had undergone major refurbishment, many having been rebranded, with all units refreshed with investment in new fixtures and fittings. Local managers are given autonomy for addressing performance with support from the centre, and during the year further investment was made in sales teams in a number of venues, supported by the customer data the group captures to promote pre-booked sales. This enables the sales staff to target customer leads based on historic engagement or interest expressed by the customers. As a result, pre-booked sales have risen by 47% across the estate in the financial period. The group has also increased investment in music-led entertainment, delivering popular and on trend acts for student nights and weekends alike. The group has opened three more of its bar concept, Bar & Beyond during the period, operating seven days a week and capturing earlier evening trade with an improved food offering. Further openings have been approved by the board for the subsequent period. The trading performance continues to improve and there will be further improvements in the future from the continued refurbishment programme. In 2017 we have already opened Kings Lynn Bar & Beyond, Portsmouth PRYZM, and ATIKs in Edinburgh and Gloucester with further investments planned in Hull, Wrexham, Uxbridge and Bournemouth. The late-night sector has faced a number of challenges historically, including the impact of student fees. Despite this, Deltic has seen its admissions grow by 6.8% over the past 12 months demonstrating there is a continued appetite for a late night out. The board believes a major factor in the performance of the sector is the under-invested nature of the properties and therefore a key facet of future improved performance of the business will arise from reinvestment in the estate.” Chief executive Peter Marks added: “FY17 was another exciting and successful year for Deltic. Progress was underpinned by the strength of the Deltic estate, its quality brands, and our colleagues’ steadfast dedication to delivering exceptional customer experience. The board remains confident that we are well placed to build on this momentum of the business. As a leader in the late-night sector, with a strong balance sheet, we were able to continue to invest in a range of long-term growth opportunities. The current year has started well, with like-for-like sales increasing 3.85%, and I am confident the initiatives we have in place will enable us to respond even more effectively to customer trends.”


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