Greene King reports record results: Greene King has reported record sales of £1,044.3m in the 24 weeks to 16 October 2016, a rise of 13.8% year-on-year. Operating profit before exceptional items was £203.7m, with all divisions in profit growth. Profit before tax was up 9% to £92.5m. Pub company like-for-like sales were up 1.3%. There was a strong performance from its Pub Partners tenanted division with like-for-like net income up 4.2%. Synergies from its Spirit Pub Company acquisition are expected to be £30m this year – the original three year target has been met in two years. The company undertook 50 brand conversions with average sales uplifts of over 30%. Chief executive Rooney Anand said: “We have delivered market outperformance and strong integration momentum against a backdrop of continued challenging market conditions. Our performance has been driven by growth in all divisions and the synergy benefits from the integration. These have helped to offset increased cost pressures, particularly from the National Living Wage, as well as additional investment in the customer offer to meet higher guest expectations of value, service and quality. The full impact of the UK decision to leave the EU remains unclear. Looking ahead, increasing levels of consumer uncertainty, further cost pressures and the changing dynamics of eating out, mean the consumer environment is likely to become more challenging. However, we are confident that the strength of our brands, pubs, people and cash generation leaves us well placed to deliver another year of progress, value creation and returns for our shareholders.” The company added: “The majority of the brand conversions were Fayre & Square to Hungry Horse. Overall, we have achieved sales uplifts of more than 30% to date. Looking ahead, we have decided to extend the brand conversion programme from three to four years to allow us to maintain a degree of flexibility over the programme as we continuously assess the changing external environment. We expect to invest a total of £35m to £40m in around 70 brand conversions in this financial year and our current expectations are to invest a further £90m to £120m in the next three years across 210-240 pubs. Since the two retail businesses were formally put together in May, we have made good progress in terms of forming one, fully integrated Pub Company support centre in Burton. The decision to relocate our managed pub business to Burton is not without its challenges, but using our ‘best of both’ approach, we expect to see, over time, improving growth and returns from Pub Company as a result.” Of current trading, it stated: “Trading in Pub Company since the period end has improved versus the trends seen in the second quarter. Trading in Pub Partners and Brewing & Brands was broadly consistent with that seen in the first half. Our latest Leisure Spend Tracker highlighted that 28% of consumers expect to visit the pub in Christmas week and we are looking forward to another successful festive season with deposited bookings on all key dates up strongly on last year.” On progress in its managed division, it stated: “Aside from brand conversions, we have made further progress in developing our five growth pub retail brands: Greene King; Chef & Brewer; Farmhouse Inns; Flaming Grill; and Hungry Horse. We have refreshed the brand propositions and better aligned the operating and support function structures to the brands. We have integrated menus across similar formats and begun the process of replacing non- core formats such as Taylor Walker, John Barras, Meet & Eat and Flame Grill with Greene King branding. We again focused on our strategic aim of delivering industry-leading value, service and quality. In both food and drink, we increased prices below the market and Retail Price Inflation by extending ‘Every Day Low Pricing’ and ‘Key Value Item’ pricing into the Spirit brands and formats and by optimising the balance between core pricing and promotional activity. Examples of enhanced value in the period include the rollout of our Season Ticket loyalty scheme into 104 Flaming Grill pubs and the refocus on ‘Big Plate Specials’ and ‘Rhythm of the Week’ activity in Hungry Horse. By introducing Team Hours, a labour rostering tool, we have been able to deliver improved service through better alignment of labour and sales while, in Old English Inns, we improved outdoor service in the summer by offering reduced menus and building new external serving stations. We made further progress on quality: we moved all steaks in Chef & Brewer to single breed Black Angus steaks; we added more fresh dishes and healthier options to the Hungry Horse menu; and we upgraded our grill quality and entertainment facilities in Flaming Grill. Third party food quality benchmarking analysis showed further improvement in our relative quality and three of our brands/formats are in the top five industry brands for overall food quality. We also invested in delivering on our aim to employ the best people in the industry. Our leading apprenticeship programme saw another 1,736 starters in the first half of the year with a further 1,200 expected to start an apprenticeship by the end of the financial year. The current 12-month retention rate of apprenticeship starters is 89%, significantly higher than comparable non-apprentice team members. The benefits of retention are key to delivering consistently high service levels and team turnover fell 1.7%pts in the period. Owning the best invested pub estate is also a key strategic aim. Our estate continues to be on an average 5-6 year property investment cycle. We invested £16m in the core estate (excluding brand conversions) across 92 schemes, we opened seven new build pubs and expect to add five more pubs in the full year, while we sold seven pubs and expect to sell 69 over the course of the financial year. We continued to invest in creating an industry-leading digital platform. Consumers want to engage digitally, most importantly to improve the convenience of their experiences, and they are increasingly using mobile technology to achieve this. To capture this opportunity, our digital strategy is currently focused on three areas: bringing all our websites up to date so they can be a stronger platform for mobile engagement; further developing our customer relationship management (CRM) by consolidating, growing and better utilising our database; and increasing our social media presence and reach. Initiatives in the first half included integrating the business onto a single online booking and deposit management system, moving the whole business onto a single CRM communication platform and extending our ‘always on’ social media approach to 800 pubs. As a result, table bookings grew 67%, CRM subscribers grew 13% and ‘fans’ of our pub Facebook pages grew 64% to 2.3m.”

Better Capital – Intertain is ‘exit ready’: Private equity form Better Capital has reported that it believes that Walkabout operator Intertain is ‘exit ready’ – in a position to be sold. Better Capital values the business at £38m compared to its cost of £23.1m. The company stated: “Intertain has traded well ahead of prior year although marginally behind expectations. The business performed strongly throughout the Euro 2016 tournament but the prolonged period of hotter than usual weather in July to September was unhelpful to a business with limited outdoor areas. The business has progressed well under Fund II’s ownership and is exit ready.”

Revolution Bars Group unveils four new Revolución de Cuba sites: Revolution Bars Group, the operator of the Revolution and Revolución de Cuba brands, has announced that it will have successfully opened four Revolución de Cuba bars in the last eight weeks of 2016 as part of its stated expansion plans to open five new sites per financial year. The Revolución de Cuba brand is driven by premium Cuban rums and creative, handmade cocktails, with food influences from across Latin America. These openings are strategically timed to benefit from the festive season. Reading, Aberdeen and Harrogate have now opened and a further Revolución de Cuba is set to open mid-December in Glasgow which takes the number of bars in Scotland to five. Currently, Revolution Bars Group’s estate totals 65 bars with 12 Revolución de Cubas and 53 Revolution bars. Overall, this expansion creates in excess of 400 new jobs. The most recent opening, Revolución de Cuba, Reading, opened its doors on 24 November, 2016. Boasting 5700 square feet across two floors this 170-cover site features a retractable roof on the first floor, which will be used year round to accommodate 40 additional covers with a heated terrace. It complements the Revolution that has operated in Reading for a number of years. Situated in the heart of Harrogate, Revolución de Cuba is located in a totally transformed building and opened on 14 October. It is positioned on Parliament Street in the centre of the dining quarter of this affluent Yorkshire town and spans 3100 square feet over two floors. Located within the Academy Centre Courtyard, Revolución de Cuba Aberdeen opened on 18 November. It operates within a landmark listed building and a 5200 square foot site with 130 covers and has an outdoor bandstand enabling another 40 covers. This will be the fourth bar in Scotland that Revolution Bars Group has opened with the others in Edinburgh, and a Revolución de Cuba and a Revolution in Glasgow. In Mid-December, Revolution Bars Group will open a further new 4300 square foot site in Glasgow which features 100 covers and 300 square feet of external seating, close to Queen Street, under the Revolución de Cuba brand the second opening in Scotland in a month, increasing the Scottish estate to five. Chief executive Mark McQuater said: “Our stated strategy is to open 5 new bars each year. We will have opened four new Revolución de Cubas in the last 8 weeks and more than doubled the number of Revolución de Cubas, now 12 bars, in little over 18 months, a testament to the strength of the concept and brand. The early opening profile in H1 will benefit the Company for the year to come. Looking ahead we have a strong pipeline of sites.”