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Thu 11th Oct 2018 - Propel Thursday News Briefing

Story of the Day:

Ralph Findlay – government is inept and doing nothing to support sector: Marston’s chief executive Ralph Findlay has lambasted the government, labelling it as “inept” while “doing nothing” to support the wider industry. Speaking to Propel on the back of Marston’s year-end trading update, Findlay said two of the three parts of the business – Taverns and its beer business – had performed “fantastically”, while its Destination & Premium segment had managed “reasonably well in a difficult market”. He said: “There is a lot of stress in the sector with oversupply in the market at the moment, most of it in the casual dining sector. I guess food-led pubs are part of that. There is a lot of discounting going on and we’ve tried to avoid that. I think we’ve also been successful for two main reasons. Firstly, we have avoided investing in areas where there is intense competition. I think that’s been really important. Secondly, we are fundamentally a pub business. The Marston’s brand for me is the pub. That has longevity and I think that has also been important. The issues in the wider sector are likely to continue for a while. Capacity needs to come out of the market while the government needs to play a much bigger role in recognising the cost pressures operators face that are causing so many companies to go out of business. The government is contributing to that and is doing nothing to address the challenges – it is inept.” Findlay acknowledged wider struggles in the sector were presenting the company with more opportunities to expand – Marston’s has acquired 15 former Mitchells & Butlers wet-led community pubs from Aprirose. Propel understands they are The Bear in Romford; The Flintlock in Hinckley; Gardeners Arms in Thornton-Cleveleys, Lancashire; Hesketh’s Arms in Preston; Moat House Inn in Caerphilly; The Poacher in Wigan; The Vale in Coventry; Bulls Head in Kings Norton, Worcestershire; Flying Childers in Doncaster; The Foley Arms in Sutton Coldfield; Golden Hind in Kingstanding, Birmingham; Golden Lion in Wolverhampton; Jolly Crofters in Horwich, Greater Manchester; Old Lane in Chippenham; and Ye Olde Crown in Rayleigh, Essex. Findlay said: “They fit our model really well and we’re confident with the right investment we can grow them even further. At this point we will balance our investment in organic growth, new-builds and potential acquisitions. There are certainly more pubs for sale than there has been previously.” Marston’s opened 14 pubs and seven lodges during the year, including a 104-bedroom lodge at the Ebbsfleet Garden City development, with Findlay “very pleased” by its performance. The company still plans to open ten pubs and five lodges in 2019. 

Industry News:

Next three Propel conferences open for bookings: The next three Propel conferences are open for bookings. The final Propel Multi Club Conference of 2018 is a full-day event that will take place on Thursday, 1 November at the Grange Hotel in St Paul’s, London. To see the speaker schedule, click here. Multi-site operators of pubs, restaurants and foodservice outlets can book up to two free places. Propel and Think Hospitality will launch a new event, the Experiential Leisure Conference, on Friday, 9 November. The half-day event will take place at One Moorgate Place, London. To see the speaker schedule, click here. Tickets are £345 plus VAT for operators, £445 plus VAT for suppliers, and £295 plus VAT for Propel Premium subscribers. Meanwhile, the People and Training Conference, organised by the British Institute of Innkeeping (BII) in association with Propel, will take place at Bafta Piccadilly on Tuesday, 20 November. To see the speaker schedule, click here. Tickets are £65 plus VAT for operators who are BII members and BIIAB members and £200 plus VAT for operators who are non-BII members. Supplier tickets are £95 plus VAT for BII members and BIIAB members and £245 plus VAT for all other organisations. To book tickets for any of the events, email Anne Steele at

Slow service and rude staff driving negative reviews: Slow service and rude staff are the main drivers behind customers leaving negative reviews at pubs, bars and restaurants, according to Feed It Back’s latest monthly social review tracker. Analysing customer insights gathered from tens of thousands of Facebook, Google and TripAdvisor reviews as well as on-site feedback, the findings also highlighted the difference in customer expectations when dining in restaurants and casual dining sites, and bars and pubs. The main complaint among restaurant customers was speed of service, with 20% of negative feedback relating to slow service or long wait times. Most complaints cited time between being served starters and mains, and seeing other customers who ordered food later served first. For pubs and bars the most common criticism was food quality, with 19% disappointed by how their meal tasted. Digging deeper statistics revealed poorly executed traditional dishes such as chips and roast dinner were the prominent drivers in negative reviews. While interactions with staff drove complaints for both sectors, restaurant-goers placed greater weight on their servers with six out of the top ten complaints related to efficiency, engagement and attitude of waiting staff. Meanwhile, pub and bar diners’ grievances focused more on the venue and its surroundings, with more than 20% of complaints referencing atmosphere, access to an outside space, cleanliness and value for money as chief bugbears. Feed It Back chief executive Carlo Platia said: “As a nation we don’t like complaining in public but we’ll vent on social channels, review sites and in person to family and friends. Seeking these complaints and understanding what is driving them is not only a crucial step to improving online reputation but an integral tool for increasing sales. It might seem obvious slow service is a key driver in negative reviews but the interesting part is in the detail of the data when you find out it’s actually the wait time between the starter and main course that’s frustrating customers. The brands that will win the fight for market share over the next five years will be the ones that truly listen to customers and utilise all the data at their disposal to drive their experience.” 

Hospitality can be ‘future of UK high street with right support’: The hospitality sector can be the future of the UK high street with the right support from government, UKHospitality has said. Giving evidence to the Housing, Communities and Local Government Select enquiry on high streets and town centres, chief executive Kate Nicholls highlighted the vibrancy and value of the sector and underlined its ability to achieve even greater levels of growth and investment with the right support from Downing Street. Nicholls emphasised the value of hospitality to the UK economy as a hotbed of entrepreneurship, with many startups and young businesses driving growth across the UK. She further warned hospitality employers were suffering from cost pressures and, in some cases, 30% had been wiped off margins. A call for a root and branch reform of the business rates system was reiterated as well as UKHospitality’s ambition for a digital business tax to ensure online businesses pay their fair share – with funds used to ease the burden on hospitality businesses. Discussing working with local authorities, Nicholls said councils were key to facilitating partnerships with businesses to provide greater co-ordination on licensing issues and efforts to improve planning, which had not kept pace with change in the sector. She added: “Lessening of financial burdens and easing of regulatory issues will help hospitality deliver even more jobs and investment in communities. Conversely, if businesses continue to be squeezed much of the good work they have already done may be lost.”

New industry-led charity to help vulnerable into hospitality careers: A new industry-led charity has been formed to assist the homeless and former service personnel and offenders launch a career in hospitality. Only A Pavement Away (OAPA) marked its official launch with a House of Commons reception on Wednesday (10 October) to coincide with World Homeless Day. The programme will see each candidate receive full training and support from companies and charities, underpinned by a 12-month post-engagement support package ensuring each candidate has the best chance of success in turning their life around. OAPA has worked closely with homeless charity Crisis, whose research reveals a joined-up approach, where housing and employment support is provided simultaneously, is a more sustainable way of preventing homelessness. According to the latest figures, 4,751 people sleep rough each night, a 15% increase from last year. OAPA founder and chief executive Greg Mangham said: “Our mission is to help reintegrate people into society through employment, giving individuals a fresh start, whether homeless or former military personnel or offenders. We have an opportunity to nurture a partnership between charities that manage and assist the vulnerable and an industry looking to fill a wealth of roles. Our pilot schemes have been encouraging and we are excited to get things fully under way.” The charity aims to provide jobs for up to 500 homeless people within the first year.

Popularity of craft continues to rise as drinkers experiment with beer: The popularity of craft beer is continuing to rise as drinkers experiment with different styles and flavours, according to a study by Brewhouse & Kitchen, the UK’s largest brewpub group. More than one-third (34%) of 2,004 respondents named beer as their favourite alcoholic beverage, with almost half (49%) of those preferring craft beer to mainstream beers. When drinking at a pub, more than one-third (34%) of men and 23% of women try more alternative beers than they did ten years ago, according to the report. Londoners are the most adventurous, with more than half (54%) stating they experiment more than they did a decade ago, with millennials almost three times more likely to be adventurous than previous generations, the study stated. Brewhouse & Kitchen said UK craft beer sales had grown the fastest of any beer category, increasing 48% in the past 12 months, while the number of UK breweries has risen 64% to more than 2,000 in the past five years. Brewhouse & Kitchen co-founder Simon Bunn said: “Beer-brewing styles had been fairly static until the craft beer revolution and now, with millions agreeing they sample and enjoy many more styles regularly, a space has opened for more adventurous styles to succeed. This research is a welcome boost to the market and proves craft beer and brewing is ready to compete on an international level.”

The Benevolent presents eight recommendations to safeguard employees’ mental health: The Benevolent, a charity that supports employees in the drinks trade, has presented eight recommendations aimed at safeguarding the mental health of employees in the industry. The charity launched the project to coincide with World Mental Health Day, which focuses on global mental health education, awareness and advocacy against social stigma. This year, alongside the launch of its first mental health campaign #NotAlone, The Benevolent presented a report underlining the mental health difficulties experienced in the trade with the goal to create and implement a set of industry rules to safeguard the mental health of employees. The recommendations include promoting mental health awareness training for all employees, staff receiving a mental health toolkit in their induction packs, creating mental health champions across all company levels, and work-related stress assessment. Several companies and industry bodies have endorsed the recommendations including Bibendum, Pernod Ricard UK and the Wine and Spirit Trade Association. The Benevolent chief executive Chris Porter said: “The level of support from the industry this year has been incredible. I am so pleased we are seeing engagement in words begin to translate into action. There is still a long way to go but the reception of the initiative by this wonderful trade demonstrates a real desire to deliver help and comfort to those who are facing mental health difficulties.”

Company News:

The Deltic Group – ‘compelling financial case’ remains for Revolution merger: The Deltic Group, the UK’s largest operator of premium late-night bars and clubs, has said there remains a “compelling financial case” for a merger with Revolution Bars Group despite the latter ending acquisition talks. The companies were reported to be in early-stage discussions over a potential transaction but yesterday (10 October) Revolution said discussions regarding a transaction involving a possible acquisition of The Deltic Group had been “terminated” as it would “not be in the best interests of the company’s shareholders”. A spokesman for The Deltic Group said: “Deltic still believes there is a compelling financial case for a merger between the companies but respects the decision of Revolution’s board. Deltic remains a shareholder in Revolution Bars Group and will follow developments closely. The board would also like to reiterate Deltic is a well-run business with a strong financial performance over many years. The Revolution merger proposal was only one of several routes the Deltic directors were exploring to take the company forward. It continues to believe the late-night economy is a good investment and the doubling of profits over the past six years, with about the same number of venues, underpins that view. Deltic will continue to seek profitable growth through continued investment in the current business and a number of possible strategic acquisitions.” The Deltic Group, led by chief executive Peter Marks, made an approach for Revolution Bars Group in October last year. At the time, Revolution Bars Group was pursuing an ultimately unsuccessful £101m merger with Stonegate Pub Company. Both sides were restricted from re-entering talks with Revolution Bars Group for six months. After being rebuffed, The Deltic Group, which operates 57 venues, acquired a 3% stake in Revolution Bars Group. 

Arc Inspirations secures Jamie’s Italian site in Newcastle for first north east venue: Arc Inspirations, the Leeds-based operator of a number of fast-growing brands, has secured a Jamie’s Italian site in Newcastle for its first venue in the north east. Arc Inspirations will invest £1.5m to open a Banyan Bar & Kitchen after Jamie’s Italian closes at the city centre site on Friday, 4 January. The 10,000 square foot venue will span two floors and take Arc’s portfolio to 19 bars, including nine Banyan sites. The opening will create 70 jobs. Arc Inspirations chief executive Martin Wolstencroft said: “We have spent a considerable amount of time perfecting and tweaking our proposition and operating model, allowing our brands to trade harmoniously in close proximity. We’re confident in our strategy and keen to take our brands to new guests in new cities and feel Newcastle is the perfect location for our first site outside Yorkshire and Manchester. Following our spate of openings in recent weeks, this latest move reflects the momentum of the business and our hunger to grow. We’ll take learnings from those openings and apply them to this site. We will continue to seek out opportunities in new locations while keeping a laser focus on our existing bars to guarantee the strong sales and excellent customer experiences that have built our reputation over the past 20 years.”

Try Market Halls reveals full Victoria line-up: Try Market Halls, the company launched by former property investor Andy Lewis-Pratt and Simon Anderson, the restaurateur behind London’s Pitt Cue Co, has revealed the full line-up of traders at its Victoria food hall, which opens next month. King’s Cross-based Malaysian restaurant Roti King will launch Gopal’s Corner offering a Malaysian Tamil menu, while chef James French will open Nonna Tonda offering dishes such as pappardelle with longhorn shin ragu. Chefs Jon Rotheram and Tom Harris, of Michelin award-winning pub The Marksman in Hackney, will launch British savoury bun concept Bunshop, offering four seasonally changing options. Koya Ko will be a third site for Tokyo-style noodle cafe Koya, while Nud Dudhia and Chris Whitney, who have grown Mexican concept Breddos Tacos in a joint venture with Gleneagles owner Ennismore, will open a second site for their Tijuana-inspired Super Tacos concept. Soho-based Chinese restaurant Baozi Inn will start expansion with a second site, while it will be a third venue for Jewish soul food trader Monty’s Deli. Comfort food concept Flank will be a second site for chef Tom Griffiths, while Kerbisher & Malt will be a modern fish and chip shop. Fanny’s Kebabs, which also operates in Market Halls Fulham, will offer upmarket kebabs and flatbread, while Squirrel is described as a fast-casual, healthy eating concept. Finally, coffee will be on offer from roaster Press alongside loose-leaf tea, smoothies and soft drinks. There will also be three bars, while a roof terrace will open next year. Market Halls Fulham opened in May, with the company looking to open a further London site, in Oxford Street, while eyeing Liverpool, Glasgow, Edinburgh and York.

Wild Food Café to start expansion with second London site: Joel and Aiste Gazdar, the couple behind Covent Garden vegan restaurant Wild Food Café, are to expand their business by opening a second site in the capital. The restaurant will launch in Upper Street, Islington, on Friday, 7 December offering a menu the Gazdars have been unable to achieve due to limited space at their Covent Garden site. Additions will include gluten-free, wood-fired pizza, “wild” brunch and a superfood cocktail bar. The concept focuses on foraged wild ingredients, slow raw food processes and a commitment to organic produce with medicinal benefits. The aim is to maintain as much natural goodness in ingredients as possible and the team works closely with local organic food producers, growers and foragers. Starters will include pulled jackfruit sandwich bites, with mains such as coconut-seared plantain stew. The bar will offer “medicinally focused” juice, herbal tonics, natural wine, and superfood smoothies and cocktails. The Gazdars said: “We are excited to be able to establish a bigger, bolder restaurant and well-being space in north London to reach many more people.”

Starbucks adds childcare support to benefits programme: Starbucks has added another layer to its employee benefits programme. The perk is geared towards one of the biggest challenges dual-income families face – childcare support. Starbucks is offering all employees back-up childcare through, an online market place for finding and managing family care. The perk also includes back-up care for adults and provides ten subsidised back-up care days a year for children and adults whose families work at Starbucks. The company is footing the bill for the $150 yearly membership fee, which gives Care.Com members access to a network of care-givers. Employees will pay $1 an hour for in-home back-up child or adult care or $5 per day per child for centre-based childcare. The move follows a series of employee benefits launched by Starbucks. In January, the company said eligible US employees could accrue paid sick time based on hours worked. Last year, Starbucks expanded its parental leave benefits to include non-birth parents, including same-sex spouses, foster and adoptive parents.

Moto appoints former Greggs boss as chief executive: Motorway services operator Moto has appointed Ken McMeikan as chief executive to replace Tim Moss, who is standing down after 12 years in the post. McMeikan, who joins Moto from his position as chief executive of Brakes Group, has worked for Tesco and Sainsbury and was chief executive of Greggs prior to Brakes. He will join Moto on Thursday, 1 November with Moss remaining at the helm for a short period to ensure a smooth transition. McMeikan said: “I am delighted to be joining Moto. It’s a great business with significant growth opportunities.” Moss, who successfully led Moto in its separation from Compass Group in 2006, said: “It has been a pleasure to lead the business over the past 20 years with a great team of people who have all contributed to building a highly successful British-owned business. We are proud of our role transforming the industry over this period – introducing popular high-street brands and improving the standard of facilities and service for our 120 million annual visitors. The business is continuing to grow and invest and looks forward to further success under Ken’s leadership.” Moto chairman Mike Tye added: “Tim has been an outstanding servant to the organisation during his long tenure. He has led from the front and built a high-quality team in the motorway service area sites and support centre. He has steered the business through a period of significant change and growth and has led the introduction of new formats such as M&S and Greggs to the motorway sector. His presence will be greatly missed by all of us but I am confident the business will continue to prosper and grow under Ken’s direction with the support of the strong senior management and teams right across the business.”

Former Domino’s Pizza regional operations director turned Papa John’s franchisee opens fifth site: Former Domino’s Pizza regional operations director turned Papa John’s franchisee Amit Abhol has opened his fifth site – in Denton, Manchester. Abhol, who previously revealed he plans to have a 20-strong estate by 2020, has opened his latest site in Stockport Road. He said: “Denton is a great location for us. It’s not far from our existing Stockport store and there is a real opportunity to target an untapped market. In addition, we aim to open another Papa John’s to widen our reach further before the end of the year.”

Brighton-based cocktail bar operators to open pub for second site: The team behind Brighton and Hove cocktail bar The Plotting Parlour is to open a pub in the city. The New Bush in Arundel Road, Kemp Town, will reopen as The Daddy Longlegs. The pub has undergone a major refurbishment, with the bar opening in the “coming weeks” and the kitchen shortly after. The name refers to Magnus Volk’s electric railway, which carried tourists along the coast between 1896 and 1901 on 7m legs towering above the sea. Remnants of the rails can still be seen at low tide. A spokesman said: “We will create the atmosphere of an informal pub in a calm but vibrant area. The Daddy Longlegs will be an escape from city life. Based just off Brighton seafront near the marina, the pub will be about quality. The service style will be casual and friendly with premium spirits and interesting wine.” Kate Dowd, of agent Fleurets, who brokered the New Inn’s sale, added: “They are a great team and I’m excited to see them bring a city centre vibe to this area. With plans for the ‘people’s promenade’ on the seafront, the future is looking good for the eastern end of the city.”

Belgium-inspired sandwich bar and bakery to launch in Manchester next month: Belgium-inspired sandwich bar and bakery Robert & Victor is to open in Manchester next month. Belgian entrepreneur Simon Dasnoy will launch the concept in Oxford Street offering sandwiches, bread, pastries and Belgian chocolates. Robert & Victor takes its name from Dasnoy’s grandfathers, who were both farmers. The menu will focus on natural ingredients and locally sourced produce with no additives, flavour enhancers or preservatives. Recipes will include Le Louisiane (homemade Cajun sauce, British chicken breast, cashew nuts, pineapple, carrots, tomatoes and mixed leaves). Robert & Victor will also be the first UK retailer to sell Belgian pralines from François Deremiens, who is listed in the top ten chocolatiers in Belgium. Dasnoy said: “I visited many places in the UK as part of my market research and Manchester really stood out. It’s a dynamic city full of opportunity, with a huge market for the types of products we offer.” Grade II-listed St James’ building dates to 1912. Andrea George, head of retail leasing at landlord Bruntwood, added: “We are committed to supporting innovative entrepreneurial ventures such as Robert & Victor.”

Cobra Beer reports turnover and profit rise: Cobra Beer, which was founded by Lord Karan Bilimoria in 1989, has reported turnover rose 0.4% to £57,108,000 for the year ending 31 December 2017, compared with £56,880,000 the previous year. Pre-tax profit was up 6.3% to £9,015,000 compared with £8,483,000 the year before, according to accounts filed at Companies House. Beer manufactured by the company is sold across the UK, India, Europe, Middle East and East Asia, while Molson Coors now holds a controlling interest in the company. Molson Coors is Cobra Beer’s only customer and acts as its distributor. In their report accompanying the accounts, the directors stated: “Management continues to monitor consumer trends to ensure the Cobra brand is well positioned to adapt to changes.” Lord Bilimoria, who is the company’s chairman, has also served as its chief executive and was created a life peer in 2006. Molson Coors paid about £14m for a 50.1% share, leaving Lord Bilimoria and other shareholders with the remaining stake.

Stonegate brings Popworld to Bolton for 28th site: Stonegate Pub Company will open a venue for its party brand Popworld in Bolton on Friday (12 October) following a £200,000 conversion of a Reflex site. The site is the brand’s 28th. Popworld features a soundtrack from the nineties and noughties alongside cocktails, bookable booths and cocktail masterclasses. Popworld brand manager Jamie Rosenfeld said: “We are so excited to bring Popworld to Bolton. We have had such great success over the past few years and are continuing to grow as a brand, throwing unforgettable parties across the UK.” In August, Stonegate said it would have 35 Popworld sites open by the end of 2018. 

Revolution Bars Group to appoint new non-executive director: Revolution Bars Group, the UK operator of 76 premium bars trading under the Revolution and Revolución de Cuba brands, has announced it intends to appoint William Tuffy as a non-executive director. The appointment will take effect from the end of the company’s annual general meeting on Monday, 26 November, subject to shareholder approval. The company stated: “William is a chartered and certificated accountant with more than 30 years’ experience in senior general and financial management roles in retail, fast-moving consumer goods, and property investment and management. He has also been involved with business transformation and turnaround projects in companies ranging from large multinationals to mid-sized businesses and startups. William’s appointment brings expertise to the board in all areas of finance and corporate governance as well as retail discipline and development. As such he will chair the company’s audit committee and sit on its remuneration and nomination committees.” Chairman Keith Edelman said: “We are delighted William is joining Revolution and believe he has much to offer in the next stage of our business development.”

M&B sees ‘significant’ boost for cider sales thanks to kiwi-saving app: Mitchells & Butlers (M&B) has seen a boost in sales of Old Mout cider at its venues helped by the rise in gamification. Old Mout owner Heineken UK and M&B launched mobile game Kiwi-Cycle to raise money to help save the kiwi from becoming extinct. The game, hosted on M&B platforms, also aims to encourage customers to try Old Mout cider and increase dwell time and frequency on the app. Kiwi-Cycle encourages players to collect fruit to unlock prizes redeemable at 673 M&B outlets. The game has raised £20,000 for charity, been downloaded by more than 34,000 players and been played more than 500,000 times. M&B procurement manager Ben Lockwood said: “Gamification continues to capture the imagination of our guests so this was an interactive way to make them more familiar with the Old Mout brand. The game enjoyed half a million plays, leading to positive redemption numbers on prizes available. This has increased the trial of all our listed Old Mout flavours and ultimately ensured sales have been significant this summer. Feedback from our operators and guests has been positive and we expect that to continue with further brand activations.”

Family-run theme park company reports profit boost as turnover passes £5m: Family-run, three-strong theme park company Gulliver’s Kingdom has reported turnover increased to £5,087,417 for the year ending 31 December 2017, compared with £4,631,811 the previous year. Accounts for Weavers Close filed at Companies House also showed pre-tax profit was up to £556,045, compared with £474,779 the year before. In their report accompanying the accounts, the directors stated: “Theme park turnover increased due to improved weather conditions during the holiday periods. However, Splashzone takings were down as a result of closures during the year for refurbishments.” Ray Phillips opened Gulliver’s Kingdom in Derbyshire in 1978, with sister sites in Warrington and Milton Keynes opening in 1989 and 1999 respectively. The business has also begun work on a site in Rotherham that is set to open in 2020.

Exeter Chiefs rugby star to open Irish sports bar and restaurant: Exeter Chiefs rugby star Gareth Steenson is to open an Irish sports bar and restaurant in the city. Steenson has teamed up with former playing colleague Carl Rimmer to launch The Stand-Off in Portland House, Longbrook Street, on the former site of cocktail bar Book Cover. Steenson said: “This is a completely different departure for me but I am really excited about it. We want to bring the best of Irish hospitality to Exeter with a Devon twist.” Jon Clyne, director at Charles Darrow, which acted for The Stand-Off team, added: “With the ongoing success of Exeter Chiefs on the pitch, the rugby scene has become an important part of life in Exeter – and long may that continue.”

Cumbrian-based The Lakes Distillery reports turnover boost: Cumbrian-based The Lakes Distillery, which raised £1.75m on crowdfunding platform Crowdcube last year for expansion, has reported turnover increased 45% to £4,329,000 for the year ending 31 December 2017, compared with £2,968,000 the previous year. Pre-tax losses narrowed to £937,000 compared with £1,072,000 the year before, according to accounts filed at Companies House. The distillery, which is within the Lake District National Park, operates as a tourist destination and exports gin, whisky, vodka and liqueur across the world. In their report accompanying the accounts, the directors said the launch of a selection of gifts and a new line of liqueurs helped growth, with further contributions expected from those product lines in 2018. Activity at the visitors’ centre increased during the period, with the numbers of covers at the on-site bistro up and distillery tours exceeding 30,000 for the first time. Sales are expected to increase in 2018 after the distillery launches its first single malt. In September, the company outlined plans for flotation on AIM in a move designed to raise up to £15m in growth capital.

Scarborough-based Yorkshire Hospitality acquires second site: Scarborough-based Yorkshire Hospitality has acquired its second site. The company has bought Ryndle Court Hotel in the town off an asking price of £725,000 through agents Christie & Co. The three-storey hotel comprises 23 en-suite bedrooms, a 40-cover restaurant, a bar and a 55-capacity function room. Yorkshire Hospitality, which also owns Scarborough Travel & Holiday Lodge, plans to modernise the property and build on its private function business. It added: “We are excited for the development and to introduce new bedrooms to the property. This is a great new addition to our portfolio.”

Peel Hunt cuts Marston’s forecasts by 3% despite improved trading: Peel Hunt leisure analyst Douglas Jack has cut his forecast in Marston’s by 3% despite improved trading. Issuing a ‘Buy’ note on the shares with a target price of 125p following the company’s year-end trading update, Jack said: “Total managed pub sales are up 3.2%, with drink sales up and food down, reflecting ongoing difficulties (largely driven by oversupply) in the eating out market. This impact was felt most in Destination & Premium (D&P), whose like-for-like sales fell 1.2% in 2018E after rising 0.1% during the past ten weeks. Fourth-quarter trading was against a soft comparable (minus 1.0%), and was broadly in line with the pub restaurant constituent of the Coffer Peach Business Tracker. Despite the like-for-like sales decline, D&P margins are expected to have fallen by just 50 basis points, supported by limited discounting. Taverns like-for-like sales rose 3.8% in 2018E, having risen 3.8% over the past ten weeks. Combined D&P/Taverns like-for-like sales rose 0.6% in 2018E with the World Cup a net benefit to the group. Combined, they were up 1.6% during the past ten weeks. Leased like-for-like profits rose 2% in 2018E, having risen 2% in the fourth quarter. Brewing volumes rose 47% in 2018E, largely due to the Charles Wells acquisition. Nevertheless, the company believes underlying like-for-like volumes were also positive, having benefited from the World Cup and good weather. A total of 14 pubs/bars and seven lodges were opened in 2018E. Expansion from 2019E has been reduced resulting in a £25m annual capex reduction prior to a £5m annual increase in organic investment, appropriately repositioning value destination pubs into more premium formats. The company has acquired 15 community pubs (managed and franchised) that will go into the Taverns estate. The cost is undisclosed but should be equally offset by a sale and leaseback, leaving a net cost of £4m to develop the sites. The sites are expected to generate £0.5m of Ebitda in 2019E, followed by £1.0m in 2020E. We believe the dividend is sustainable, albeit with net debt/Ebitda forecast to be stable in 2018-2020E, supported by lower capex from 2019E and pension contributions due to cease in 2020E. Downside risk to 2019E forecasts should be limited by current assumptions of minimal like-for-like sales and average profit growth.”

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