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Fri 24th Feb 2023 - Update: Cineworld, Leon enhances estate, consumer confidence
Cineworld expects to emerge from Chapter 11 bankruptcy in first half 2023: Cineworld Group has announced it expects to emerge from Chapter 11 bankruptcy protection in the first half of this year but added it did not expect any possible deal would provide recovery for the cinema chain operator’s shareholders. The company, which is running a formal auction of its assets, said: “Discussions between the company and certain of its stakeholders regarding a potential plan are progressing. Whilst the discussions suggest that there is a route to the company emerging from the Chapter 11 cases, in light of the level of existing debt that is expected to be released under any plan, the company does not believe that there will be sufficient creditor support for a plan that contemplates any recovery for equity interests, and it is therefore not expected at this time that any plan will provide any recovery for holders of Cineworld’s existing equity interests. Based on the current status of these discussions, Cineworld now expects to emerge from the Chapter 11 cases during the first half of 2023. Although any sale transaction resulting from the marketing process, among other things, may delay emergence beyond the first half of 2023, the company remains committed to emerging from the Chapter 11 cases as expeditiously as possible.” As announced on 3 January 2023, in parallel with the discussions regarding a potential plan, Cineworld has also been running a marketing process. It said: “Further, in connection with the marketing process, the company has now received non-binding proposals from a number of potential transaction counterparties for some or all of the group’s business. None of these proposals involves an all-cash bid for the entire business. The company is reviewing such proposals in conjunction with its advisers and key stakeholders and, whilst no decision has been made as to whether to pursue a sale transaction, and the terms of any such transaction remain uncertain, based on the proposals received to date, it is not expected that any sale transaction will provide any recovery for the holders of the company’s equity interests. Any sale transaction for the group as a whole would not include the sale of the equity interests in Cineworld itself and would therefore not be subject to the rules of the Takeover Code.”

Updated Premium Database of Multi-Site Companies released on Monday, two more databases to follow next week: A total of 21 new multi-site companies, operating 64 sites, have been added to the next edition of the Propel Premium Database of Multi-site Companies, which will be released on Monday (27 February), at midday. The updated Propel Multi-Site Database, which is produced in association with Virgate, includes regional restaurant and bar operators, growing entertainment concepts, and expanding hotel operators. Premium subscribers will also receive a 1,700-word report on the new additions to the database. The comprehensive database is updated monthly and provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different. The database now features 2,789 companies. Meanwhile, the next edition of the Who’s Who of UK Food and Beveragewill be sent to Premium subscribers on Tuesday (28 February). It is the first database where full profiles of 650 of the UK’s top food and beverage operators are available in one place. It features more than 170,000 words of content, including 46 updated entries, while 16 new companies have been added. The companies, listed in alphabetical order, will have their most recent results reported as well as broader information around Ebitda, plans and trading style available. The database merges Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium subscribers will also receive the next edition of the New Openings Database on Friday, 3 March, at midday. It focuses on newly announced openings and upcoming launches in the sector and is updated every month. The next edition also includes a 7,000-word report on the new additions to the database. Premium subscribers also receive access to the Propel Turnover & Profits Blue Book and the UK Food and Beverage Franchisor Database. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The single subscription rate is £445 plus VAT for operators and £545 plus VAT for suppliers. Email to upgrade your subscription. Subscribers also receive access to Propel’s library of Friday Wrap interviews and now also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out; regular video content and regular exclusive columns from Propel group editor Mark Wingett.

Leon adds to London estate, lines up Bath opening: Natural fast food brand Leon has added two new sites to its London estate, and lined up its first opening in the south west. The EG Group owned business, which operates circa 80 restaurants throughout the UK, as well as in the Netherlands, has opened sites this week in Earls Court (22 February), and Hanover Square (23 February). This follows other recent high-profile London openings including Southbank and Battersea and Brixton. The larger of the two restaurants Hanover Square is 456.7 sqm and hosts a large seating area accommodating 100 covers internally and 16 externally. The Earls Court restaurant flanks the busy entrance to Earls Court Underground Station, catering to commuters and locals alike. Situated across two floors, there are 40 internal seats. Managing director of Leon Restaurants, Glenn Edwards, said: “Our expansion through the years has proudly taken us throughout the UK, and even further afield, however, Leon will always have an affinity with London as it’s home to our first-ever restaurant on Carnaby Street. Leon will always offer an experience that is absolutely suited to city life and catering to more and more Londoners, is something that’s so exciting for us at Leon.” As we move into Spring, Leon is also gearing up to open its first restaurant in the south west of England, in Bath’s Stall Street. It said that other regional UK locations are also under consideration, as well as openings with franchise partners in alternative locations, such as motorway service stations, which includes a recent opening in Magor, the first Leon in Wales. 

Consumer confidence rebounds as economy avoids early recession: The UK has enjoyed a surprise rebound in consumer confidence this month after the economy avoided an early recession and inflation continued to fall, a closely watched survey shows. The Times reports confidence rose by seven points to -38 on the long-running index by GfK, the market intelligence company, mainly because of a rise in optimism about the wider economy over the coming year. Inflation is thought to have peaked at 11.1% in October and fell for three consecutive months to reach 10.1% at the start of this year. Output growth surprised economists by stagnating rather than shrinking in the final quarter of last year. Confidence improved on each of the five measures, with the biggest jumps recorded in respondents’ perceptions of the wider economy and their personal finances for the next year. The figures rose by 11 points and nine points to -43 and -18, respectively. The survey is based on the results of online surveys completed by 2,000 people aged 16 and above between 1 February and 13 February. However, confidence remains significantly lower than it was in February 2020 before the first pandemic lockdown, when the index was at -7. The figure reached -49 in September, its lowest since the survey began in 1974 as the cost of living crisis intensified. The metric remained close to record lows last autumn after the fallout from the mini-budget in September prompted a sell-off of UK assets and pushed up mortgage rates, while continued interest rate rises and political instability added to the woes of households facing a record squeeze on their incomes. Joe Staton, client strategy director at GfK, said it was too early to talk about a recovery in consumer sentiment but a bit of resilience might soften any downturn this year. “Despite inflation continuing to outstrip wage rises and the ongoing household challenge from the cost of living crisis, consumers have suddenly shown more optimism about the state of their personal finances and the general economic situation, especially for the coming year,” he added.

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