Punch Taverns restructure attracts criticism: The complicated restructuring unveiled yesterday for Punch Taverns is thought likely to face challenges from senior bondholders. Plans outlined by chairman Stephen Billingham are likely to divide institutional investors, who hold most of the company’s senior debt, and a small group of US hedge funds, which own sizeable equity stakes as well as major stakes in junior bonds. One of areas likely to cause friction is a plan to use £93m of cash reserves to help finance the repurchase of junior bond notes at a discount to their face value. However, opponents of the plan claim Punch’s overall borrowings are so unsustainable that the fair value of the junior debt should be nothing – or close to nothing. Much of the junior debt set for repurchase under the restructuring is held by hedge funds which are also shareholders. For the restructuring to be implemented proposals must win 75% approval from each all stakeholders. There are 16 classes of bondholders as well as bond insurers and shareholders. Senior bondholders have complained that they will have to wait five years under the restructuring to see any significant return. Executive chairman Stephen Billingham told The Telegraph: “Some (bondholders) will be difficult I am sure, but we have a duty here to deliver an answer that we think is doable, workable and fair. What we do not want to do is see these structures fall into default because we don’t think that’s good for anybody. I do not for one minute think this will be a straightforward exercise. The bond markets are full of people that want a fight sometimes.” But he added that the company had some leverage, and he hoped a deal would be agreed in the first half of this year. James Martin, a debt analyst, told The Financial Times: “The prospects for getting agreement to these proposals across both securitisations look good, in our view. No doubt, some investors will view this proposal as the start of a negotiation position.” Punch shares closed up 20% at 13p yesterday.

Shaftesbury – vacant space in the West End at an exceptionally low level: Major central London property landlord Shaftesbury has reported that it has exceptionally low levels of available space to let in the West End. It stated this morning: “The successful staging of the London 2012 Olympics and Paralympics has enhanced the reputation of London and the West End across the world. In an already popular West End, domestic and overseas visitor numbers and spending have been good leading up to Christmas and throughout the New Year period. With continuing good demand across all our villages and uses, available vacant space is at an exceptionally low level. We have sustained interest from retailers, particularly from Europe and America, seeking shops in our centrally-located villages. Similarly there are many interesting new restaurant concepts seeking space in the West End.”

Researchers to study Irish pubs: The importance of pubs to Ireland’s rural communities is the subject of major study to be carried out by experts from the University of York. Dr Ignazio Cabras, of the York Management School, who spent six years working on a similar study on pubs in the UK, will now be turning to Ireland, for a project funded by the Vintners Federation of Ireland. Dr Cabras said: “In both Ireland and England, rural pubs are in serious decline. However, they often have a vital role to play in both the social and economic wellbeing of a rural community. From providing an outlet for the sale of local produce, to a meeting place for a local sports club, to a focal point for a charitable activity, rural pubs are often at the heart of the rural community.” The researchers are hoping to present the results from the rural Irish pubs study, and a separate 14-month study into rural pubs in England, funded by the British Academy, at the Beeronomics Conference 2013.

VAT Club accelerates campaign: The Jacques Borel VAT Club, the campaign to persuade the government to reduce VAT in the hospitality industry to 5% supported by almost 40 major companies, is accelerating its campaign. The VAT Club is in the process of making contact with 100 MPs, as well as cabinet ministers including the Chancellor and Danny Alexander, chief secretary to the Treasury, to make the case. Borel told Scottish Licensed Trade News: “We are accelerating (the campaign) at the moment because the objective is to be included in the Autumn Statement this October/November,” Borel said. “Why is it so urgent? You need three to four years to obtain full results, so if we do obtain a decrease of VAT for April next year, that will be one year out of three to show the results in terms of the creation of jobs. In all other countries in Europe, food is taxed at 5%, whereas in this country it is not taxed. At the present time you have binge drinking because of an unfair fiscal position with the supermarkets; the supermarkets are zero VAT-rated for food, and because of the tremendous profits they can sell booze at a very cheap price. People can buy beer and vodka at a very cheap price, and go to parties to ‘pre-load’ or get drunk in the streets. We say that all prepared and packaged foods should be taxed at 5% because there is no difference between a pizza sold in a supermarket and a pizza sold in a restaurant, except for two and a half minutes in a microwave oven.”

Technomic – UK consumers interested in broad range of desserts: UK consumers are interested in a broad range of desserts, including those featuring liqueur-infused or unique flavours, insights firm Technomic has reported. For the UK Flavour Consumer Trend Report, Technomic asked survey respondents about their flavour preferences for dessert. Overall, consumers’ preference for sweet or citrus desserts is evenly split. About a quarter of consumers prefer citrus-flavoured desserts over sweet desserts. These desserts appeal most to consumers aged 25-34. However, a near equal percentage of respondents indicate that they prefer sweet desserts over citrus-based desserts. One-fifth of consumers like desserts that feature alcohol or liqueur, such as sherry trifle or bourbon chocolate tart. Once again, consumers in the 25-34 age group indicate the most interest in these options.

Bury business leader – food and drink is the future of the high street: A business leader in Bury St Edmunds has described food and beverage retailer as the ‘future of the high street’. Mark Cordell, chief executive of town centre business improvement group Bid4Bury, said the town centre now had more than 70 places where you could eat and/or drink, accounting for 20% of the Bid’s members. The Bury dining scene is to be boosted further by the arrival of Wildwood, which will open at the former Thing-Me-Bobs store in Abbeygate Street. Chimichanga opened recently and Chinese buffet restaurant Real China is set to open at the former Barclays bank building. Mark Cordell, chief executive of town centre business improvement group Bid4Bury, said: “Human beings are social animals – well, most of them – and we are finding even in the recession, when people might tighten their belts and not buy that pair of shoes or that outfit, they will still spend on a night out to make them feel good. I would say Bury is meeting that demand.”

Panera Bread adds pasta to the menu: Bakery chain Panera Bread, the most successful US restaurant company of the past ten years, has added pasta across the 1,600-srrong estate, by the end of the first quarter after two year of trials. The company has reported fourth-quarter profit increased 34% over a year before with like-for likes up 4.9%. Panera will  roll out three pasta items systemwide - tortellini alfredo, pesto saccottini (“purses”), and rustic penne Bolognese. “For more than two years, we have been at work developing several high-quality pasta offerings that fit within our production system and complement our soup and salad platforms,” said chief executive Ron Shaich. The pasta dishes will be offered in two sizes and a deal that will include a half salad or cup of soup.

Everards reports profit up 22% on turnover up 3.9%: Leicester based brewer and retailer Everards has reported turnover rose by 3% to £29,346,000 in the year to 30 September 2012, with pre-tax profit up to £1,545,000 compared to £1,267,000 the year before, an increase of 22%. The company also benefited from exceptional item gains of £827,000 to show a total pre-tax profit of £2,372,000. The company stated: “Turnover increased by £1,102,000 compared with the previous period and pre-exceptional operating profit increased by 11% to £3,035,000. The company continues to perform well in a challenging economy and competitive market. Although beer duty has increased by 42% since 2008 it is estimated that revenue received by HMRC has increased by only 14%, highlighting the negative impact on sales volumes. There is also a clear disparity in UK policy compared to that within the EU in that Britain contributes 40% of the EU beer tax bill and yet consume only 13% of the beer. Government policy is not sustainable and only serves to restrict job creation and investment in the industry.”

Mezze opens fourth site with ice cream parlour in the garden this week; lines up flagship fifth site in partnership with Enterprise Inns: Mezze Restaurants will open its fourth restaurant-in-a-pub site, The Warwick Arms in Clutton, this week after a £400,000 refurbishment. It will offer a wood-burning stove, a new cocktail bar, an a la carte restaurant and a new eight-bedroom boutique hotel when it opens on 9 February. Outside, there will be a Mediterranean garden with ice cream parlour, heated al fresco dining for up to 100 people with a wooden drawbridge taking customers into a new enclosed children’s play area complete with play pirate ship and castle, trampoline and picnic areas. Meanwhile, its fifth site will be Mezze at The White Lion in Portishead, which will open in May after a £600,000 refurbishment by landlord Enterprise Inns.

Draft House runs Anti-Valentine’s Party: Draft House, led by Charlie McVeigh, is marketing itself as the place for those looking to sidestep Valentine’s Day. The company e-mailed its database to say: “Do let us know if you’d like to book in. No need for taut silences, the sound of cutlery scraping on plates, desperate attempts to avoid a row, ultimately ending in failure.”

Stonegate to open fourth Popworld in Swansea: Managed operator Stonegate will open its fourth Popworld site in Swansea this month – the brand was successfully launched at its first site in Portsmouth last October. The opening is one of three sites planned to re-open this month after refurbishment – the others are The Kings Head in Chingford, The Minster Tavern in Ely, and The Squirrel in Farnborough. Last month 20 jobs were created as a result of the investment programme that saw nine pubs reopen after a total investment of over £1.5 million. 

Brentwood Sugar Hut expands with a café: The Sugar Hut nightclub in Brentwood, a former Enterprise Inns site acquired by its lessee Mick Norcross, has launched a restaurant and cafe next door to the club. The Sugar Hut Cafe will sell light lunches and simple dishes such as steak and chips from the site formerly occupied by steak house Masons. Norcross said: “We’ve got to tailor the business to suit customer needs and we have done that. This is a way for us to fill a niche.” The business is keen to cash in on the increasing number of visitors from across the country who have seen the club on ITV2’s hit reality show The Only Way is Essex. In 2011 there were 116,000 guests. That increased to 151,000 in 2012 and the business is expecting to welcome 200,000 customers by the end of this year.

Controversial Soho nightspot reports losses: Controversial Soho nightclub The Box, whose risqué shows have attracted the likes of Prince Harry, Princess Eugenie, Zara Phillips and actress Keira Knightley, has filed latest accounts that it is running at a loss and owes more than £2 million. Figures submitted to Companies House for the period ending June 2011 reveal that despite a turnover of nearly £3 million, The Box, Soho recorded losses of more than £1 million. They also show it owed over £2 million – of that £133,200 was for staff National Insurance and PAYE — and £1.4 million to other unnamed creditors.

Arc Inspirations lines up two new openings in 2013: Arc Inspirations, the highly profitable eight-strong Leeds-based multiple operator led by Martin Woolstencroft, is to add to new sites to its estate this year after several years of consolidation. The award-winning Leeds-based company, regarded as one of the most innovative operators in the UK, wants to turn a former chapel and printworks in Little Stonegate in York into a second Banyan Bar & Kitchen. The second Banyan – the first is in Harrogate - comes after the company searched in York for the right site for several years. In August, it is planning to open a new bar concept, as yet unnamed in Leeds Merrion Street. The company currently operates seven sites in and around Leeds. The company reported pre-tax profits of £2,557,465 on turnover of £11,655,708 in the year to 1 April 2012. Arc Inspirations had turnover of £12,536,538 and pre-tax profit of £2,760,300 the year before.

Costa Coffee to open fourth shop in Worcester: Costa Coffee is planning to open a fourth coffee shop in Worcester later this month. The chain is currently fitting out a new purpose built store in the St Martin’s Quarter in Lowesmoor. It will be based in the main thoroughfare between the city centre and the heart of the £75 million retail and leisure quarter.

Charles Wells adds biggest site in France yet: John Bull Pub Company, the French division of Charles Wells, has acquired its ninth pub in France – and second site in Lyon. The King Arthur pub opened last July and Charles Wells has now bought The Elephant and Castle. The estate addition is its biggest site yet - it is located on a prime corner spot on the riverfront in Lyon and has two storeys, and a terrace across two sides of the building, which will be a key attraction in the summer. Refurbishment works will start in March, with the pub expected to open in June. Anthony Wallis, managing director of John Bull Pub Company, said: “We are really excited about The Elephant and Castle, it is a great site in a prime location. In particular, the riverfront terrace should prove a hit in France in the summer months. Lyon is a vibrant city and The King Arthur is already trading well there. We are looking to add a kitchen at The Elephant and Castle so we can offer the best of British cuisine to customers as well as a great selection of cask ales, a trading model which is already working well at The Bombardier in Paris.”

 

Top New York chef installs alarms at nine New York restaurants: Celebrity chef Mario Batali, has installed hidden alarms at his nine New York restaurant to thwart over-zealous city health inspections. The alarm alerts kitchen workers that an inspector has arrived so they can quickly trash any meals they’re cooking. A button at the hostess stand triggers a loud buzzer in the kitchen and gives staff a chance to toss out what’s on the stove or in the oven and go on break before the inspector enters. “You’re supposed to keep pressing that button,” the employee said. Without meals or chefs, a kitchen is less likely to get fined over dishes being held at improper temperatures and food workers not following rules. Fines can top $5,000 per visit and result in a “B” or “C” grade.

Zizzi to open its largest UK restaurant – and first with a bar: Restaurant brand Zizzi is to open its largest restaurant in the UK – and the first to have a stand-alone bar. The new venue, Zizzi Royal Exchange in Glasgow will open next Monday (11 February) with 250 covers, complete with a bar area and outside seating. Erica Sawer, operations manager for Zizzi Scotland, said: “As Glasgow is such a vibrant city, we wanted to offer something different so we’re opening our biggest-ever restaurant in the UK that features a fully licensed separate bar. With the addition of the bar menu, we want to give visitors the choice to enjoy a meal or simply meet friends for drinks within the beautiful surroundings of the Royal Exchange building.” A total of seven Zizzi openings are planned for 2013.

Ed Turner to replace Rupert Clevely as Geronimo boss: Rupert Clevely is to step down as managing director of Geronimo Inns on 2 April, two years after the company he co-founded in 1995 with his wife Jo was sold to Young’s. Clevely will become a non-executive director and be replaced by Ed Turner, who joined Geronimo in 1999, starting out as an operations manager before becoming operations director and then commercial director for a number of years before Geronimo was acquired by Young’s. Turner became commercial director of Young’s in 2011. The company stated: “In his new role, Ed will continue to be responsible for marketing and for training and recruitment in all of the managed pubs - both Geronimo and Young’s.” Young’s chairman Nicholas Bryan said: “These changes represent a smooth and effective succession plan within Geronimo. I would like to thank Rupert for the excellent job he has done in leading Geronimo during its integration into Young’s, and I am delighted that he will continue to contribute his considerable experience, and his feel for the business he created, in a non-executive capacity. In Ed, we have a ready-made successor who has spent many years working with Rupert to grow Geronimo, and who will bring great vigour and energy to his new role as we develop the business further. With Patrick Dardis and Ed Turner, responsible for the Young’s and Geronimo estates respectively, both reporting to Stephen Goodyear, the chief executive, we have very strong leadership in place to continue driving the profitable growth of both businesses.”

 

Background briefing by Paul Charity: Rupert Clevely’s departure from Young’s comes after the Geronimo Inns business he co-founded with his wife Jo produced strong like-for-like growth during the first two years of Young’s ownership. Young’s sought to make sure Geronimo retained autonomy post acquisition to allow brand values to be retained. Unusually, also, Clevely was given a seat on the board, which some claimed was a sale condition that London rival Fuller’s was not prepared to meet. At results in November, it was clear, one month before the second anniversary of the Geronimo acquisition, that chief executive Stephen Goodyear was keen to retain the Clevelys services for as long as possible. Asked by Propel how long he expected the couple to stay with the company – Jo was not a paid employee but provided on-going design consultancy - Goodyear said: “I hope another 100 years or so – it’s been a very happy coming together.” The results in November indicated that the Geronimo acquisition was an ongoing success; Young’s had converted three pubs from its tenanted estate – The Half Moon, Putney, The Chelsea Ram and The Princess of Wales, Clapton – to be run under its Geronimo Inns division. The Geronimo division saw like-for-like sales up by 4.5% and overall sales up 32.7% with new sites The Oyster Shed and The Cow and the Calf, both in Westfield Shopping centre opening. The Young’s annual report also showed the company sensibly rewarding Clevely for the storming performance since the estate was acquired - he picked up a £200,000 bonus on top of his £240,000 of basic salary and benefits. It placed him on top of the bonus pile alongside chief executive Stephen Goodyear, who also earned a £200,000 bonus.