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Morning Briefing for pub, restaurant and food wervice operators

Thu 2nd Nov 2017 - Propel Thursday News Briefing

Story of the Day:

Deltic Group reports sales up 9.1%, sees record Halloween: The Deltic Group, the UK’s largest operator of premium late-night bars and clubs with 57 venues, has reported sales increased 9.1% to £16.4m for the period between 17 September and 31 October, compared with the previous year. Total admissions for the period increased 6.4% to 1.3 million people on a like-for-like basis. It reported early-week sales in the period were up 12.4%, while Friday and Saturday sales rose 7.5% on a total company, year-on-year basis. Deltic said it was a record Halloween Saturday with admissions up 2.3% to 90,598 on an “already impressive performance last year”. Chief executive Peter Marks said: “This strong trading period, including a record Halloween weekend and very strong Halloween Tuesday, follows a period of significant investment for the group, including an extensive refurbishment programme and the introduction of further music-led entertainment. I believe our recent performance reflects the group’s quality brands, well-invested estate and dedication to customer service, coupled with the substantial appetite among consumers for great nights out. We are seeing sales growth across all our regions and look forward to building on this.” Deltic said it was constantly pioneering new concepts, including a broader choice of music rooms. Its Pryzm venue in Kingston, Surrey, was the first to offer a female-only area – with a pamper room and opportunity to catch up away from the main dance floor – while the company has also trialled an exclusive dance floor concept at its Leeds and Brighton sites.

Industry News:

Propel launches sector’s most comprehensive marketing conference: Propel has launched the most comprehensive marketing conference the sector has seen with a two-day event. Restaurant Marketer & Innovator, in partnership with Think Hospitality, will take place on Wednesday, 17 January and Thursday, 18 January at One Moorgate Place in London. The two-day event will bring together marketers, strategists and business leaders from the foodservice sector to understand trends, share success, and define the future of the sector. A total of 40 speakers from four countries, representing more than 30 brands, will provide advice and insight. The first day, curated and moderated by James Hacon, will include Dominic Smales (Gleam Futures), Professor Charles Spence (University of Oxford), Jozef Youssef (Kitchen Theory), Russell Danks (Futurist), Olivia Fitzgerald (Zonal), Lizzy Barber (Cabana), Stephanie Lloyd (New World Trading Company), Lisa Campbell (Las Iguanas), Jim Rogers (Tony Roma’s), Mark McCulloch (WE ARE Spectacular), Michael Ingemann (Claus Meyer Restaurants) and Ewan Turney (England Rugby). The second day, curated and moderated by Ann Elliott, will feature Emma Woods (Wagamama), Susan Martindale (Mitchells & Butlers), Katrina Lawson (Costa Coffee), Kathryn Austin (Pizza Hut Restaurants), Kate Eastwood (Revolution Bars Group), Luisa Fernandez (YO! Sushi), Mel Marriott (Darwin & Wallace), Helena Hudson (Real Eating Co), Pamela McNamara (Bluestone Wales), Tania Rahman (Chit Chat Chai), Laura Sheffield (Corazon), Celia Farrer (Eat Poke), Eve Bugler (BabaBoom), Hayley Simpson (The Breakfast Club), Camilla Katte (Giggling Squid) and Sarah Weir (Albion & East). Prices for the two days are £525 plus VAT for operators and £795 plus VAT for suppliers. A one-day rate of £345 plus VAT is available to operators only. To book, click here. For more information or any queries contact Jo Charity on 01444 810304 or jo.charity@propelinfo.com or Anne Steele on 01444 817691 or anne.steele@propelinfo.com

Summer demand for UK hotels boosted by 20% rise in staycations: UK hoteliers enjoyed encouraging growth this summer helped by a significant rise in hotel demand from staycationers, according to data from online travel company Expedia. The findings, drawn from data for July, August and September, show demand for trips made by domestic travellers increased more than 20% compared with the same period last year, with several regions and cities seeing strong growth. International and domestic demand for Kent, Surrey, Essex and Yorkshire, as well as popular tourism hot spots the Cotswolds, Lake District and Cumbria, all showed a rise in demand of more than 20%. Edinburgh was the second most-popular city destination in the UK after London, with 5% year-on-year growth in demand. Hull, celebrating its year as the UK City of Culture, also enjoyed strong staycation growth, with a calendar of events during the summer boosting demand by almost 80% year-on-year. Hull also enjoyed a more than 60% rise in demand during April, May and June compared with the corresponding months last year. For the UK as a whole, hoteliers enjoyed positive growth from overseas travellers, with demand from Spain up 185%, Brazil (115%), Ireland (95%), and the US (40%). The data also shows the average daily rate for hotel rooms in the UK rose overall, notably with travellers from Poland, Austria, India, Thailand and Australia choosing to spend more. Unsurprisingly, staycationers booked their trips in the shortest window (fewer than 30 days), with travellers from New Zealand (73 days), Austria (70 days), Canada (66 days), Germany (64 days), Switzerland (62 days) and Brazil (58 days) booking the farthest out. Julie Cheneau, Expedia’s director of market management for the UK & Ireland, said: “UK hoteliers have benefited from an ongoing and strong marketing campaign from VisitBritain, highlighting events and activities across the nation. This, along with a weaker pound, means international and domestic travellers are choosing to holiday in the UK. Our data reveals we are successfully working with our hotel partners to increase demand from key international markets where visitors are more likely to spend more on rooms and other services, as well as stay longer.”

Hospitality leaders encouraged to recruit people with learning disabilities: The Springboard Charity has held an event encouraging operators to recruit individuals with learning disabilities. The Food for Thought Lunch For Hospitality Leaders took place at Westminster Kingsway College and was attended by Penny Mordaunt, minister for disabled people, health and work. Springboard offers specialised programmes dedicated to training young people with learning disabilities in roles such as waiting, catering and housekeeping. Currently, people with learning disabilities make up only 5.8% of the UK’s paid workforce. The lunch was aimed at demonstrating talent that could fill a pipeline, with the sector estimated to create 500,000 jobs in the next five years. Mordaunt said: “Disabled people make up almost a fifth of the working age population and it’s crucial the hospitality industry is not missing out on the skills, talents and personal qualities they can bring to the workplace.”

Licensing update: Licensing solicitors John Gaunt & Partners produce a useful monthly summary of topical issues. To access the latest, click here

Company News:

British-born One Group founder to become executive chairman as company shifts focus: Jonathan Segal, the British-born founder of American-based hospitality company The One Group, is to become executive chairman as it focuses on management and licensing opportunities. The company has appointed Emanuel “Manny” Hilario as chief executive and president to replace Segal. Hilario has served as a One Group board member since April. In addition, Michael Serruya will step down as board chairman but remain a director. The move comes as One Group shifts to an asset-light business model, focusing on management and licensing opportunities for its restaurants, many of which are located in hotels and casinos. In the meantime, the company has focused on building its core STK brand, looking for efficiencies internally and expanding globally. Segal said: “As we continue to shift to an asset-light business model, we believe it is an opportune time to transition to a chief executive who can focus on strategy, operations and further improvements to financial performance. I think Manny will be an excellent addition to the team and I look forward to working with him as I renew my focus on business development and global licensing opportunities.” Hilario, who previously served as chief financial officer of multi-concept franchise group Sizzling Platter, added: “Having worked with the existing management as a board member in making changes that have already resulted in significant operating improvements, I believe there is still substantial runway for further progress and profit growth.” One Group operates and licences 18 STK locations worldwide, along with restaurant and bar concepts Asellina, Bagatelle, Gansevoort Park Rooftop, Heliot Steak House, Radio Rooftop and private event space One Manhattan.

Roger Payne enters private members’ market with acquisition of Blacks Club in Soho: Restaurateur Roger Payne, the man behind celebrity hangouts Gilgamesh and Shaka Zulu, has entered the private members’ market by acquiring Blacks Club in Soho from a private investor. The purchase comprises the long leasehold of 25-year-old Blacks, which includes two restaurants, bars and an art gallery. Payne is understood to have paid about £500,000 for the club and will plough a further £500,000 into refurbishing the bars and revamping menus. Membership at the Dean Street venue costs £500 a year. Payne told the Evening Standard: “There are challenges in the dining sector but I believe customers are still willing to spend on individuality. There is a queue for membership.” Jonathan Moradoff, of agent Davis Coffer Lyons, which advised Payne on the deal, added: “There is still enormous demand for leisure sites in Dean Street because of the critical mass of trendy restaurants and bars.” In July, Payne acquired authentic American barbecue restaurant chain Chicago Rib Shack in a pre-pack administration for a consideration of £210,500 plus 50% of the rent deposits for the company’s five sites.

C2 Investment increases shareholding in Lancaster Brewery, reports drop in pre-tax profit: C2 Investment has increased its shareholding in Lancaster Brewery and has reported a drop in pre-tax profit. The company saw turnover fall slightly to £5,743,681 for the year ending 31 January 2017, compared with £5,757,918 the year before. Pre-tax profit dropped to £354,661 compared with £462,516 the previous year, according to accounts filed at Companies House. C2 Investment now owns 84.5% of Lancaster Brewery having bought a 1% shareholding during the financial year and a further 1% in February. C2 Investment also owns The Brewhouse And Tap in Lancaster, The Sun Hotel in Lancaster, The Duke of Edinburgh hotel, bar and restaurant in Barrow-in-Furness, The Mill pub in Ulverston, and The Palatine pub in Morecambe, which is tenanted. The company stated: “The brewery has carefully managed its sales levels and product pricing during the year to reflect both the quality of the product, which is exceptionally high, and its market position. The stable and capable management of the business remains an asset and 2017 will see a further improvement in performance. The Sun improved performance in 2017 across all aspects of the business. The Duke of Edinburgh Hotel has continued to expand and nine rooms were added in 2016. The hotel enjoyed a steady 2016-17 bearing in mind the disruption of adding to the room numbers. The directors are very positive about its prospects for 2017-18. The tenant at the Palatine changed in January 2017 and has further improved the performance of the business. The Mill had a steady year but an investment programme undertaken in the last three months of the year has considerably improved the whole operation.”

Steamin’ Billy gets back to 11 sites with Warwickshire opening: Leicestershire-based Steamin’ Billy Brewing has opened its latest pub – The White Horse in Atherstone, Warwickshire. Earlier this month, the company closed The Three Crowns in the market town of Oakham in Rutland, with the launch of The White Horse following a refurbishment taking Steamin’ Billy’s portfolio back to 11 pubs. The venue in Long Street offers stone-baked pizza, steak and burgers made in an open kitchen, plus a drinks list of Steamin’ Billy ales, wine, cocktails and craft beer. The restaurant includes a private dining area for parties of up to a dozen people. A company spokesman told the Leicester Mercury: “Steamin’ Billy continues to expand with its latest venture in Atherstone offering a comprehensive food menu.”

Wellington Pizza Co opens fifth Buca Di Pizza site, in Hull: Leeds-based Wellington Pizza Co has opened its fifth Buca Di Pizza site, this time in Hull. The company, founded by brothers Geoff and Nicolas Thornton, has opened the restaurant at the £80m Fruit Market development. They have invested £175,000 to fit-out the venue in Humber Street, converting a 1,900 square foot former fruit and veg warehouse into an 80-cover pizzeria and bar with seating outside for a further 20 diners. Buca di Pizza’s offerings include the Hickory Pig (smoked cheese, pancetta and pulled pork), and Seafood of Mirth (Goan curry sauce, mixed seafood, buffalo mozzarella, rocket and lime wedge). The venue offers Birra Mia, Peroni and Aspall cider on draught, alongside bottled beer and a guest ale from the Yorkshire Brewing Company. There is also a selection of Italian wine and cocktails. Geoff Thornton told BDaily: “The building has some great features that give it a really special feel, from the skylights that give the restaurant area so much natural light to the tiled floor. We’ve taken these assets and added our own quirky style.” Wellington Pizza Co opened its fourth Buca Di Pizza site, in Beverley, in August to join the brand’s other venues in Leeds (two sites), and Manchester.

Wagamama to open Reigate restaurant this month: Wagamama will open a site in Reigate, Surrey, this month. The company will open the restaurant on Monday, 13 November in the former Edward Dean kitchen showroom on the corner of Bell Street, creating 50 jobs. Wagamama applied to Reigate and Banstead Borough Council for planning permission for the venue last year but it was refused on the grounds it would lead to a loss of retail space in the town centre. The decision caused an outcry, with more than 1,000 people signing a petition calling for Wagamama to be allowed to open a branch in the town. Wagamama then appealed to the planning inspectorate, which overturned the refusal in February. A Wagamama spokeswoman told Get Surrey: “Since many of the lovely people in Reigate signed the petition to bring us to the area we have really been feeling the love and we can’t wait to bring Wagamama to the town.”

Oakman to open fourth Beech House, in Amersham in January: Oakman Inns and Restaurants will open its fourth Beech House, in Amersham, Buckinghamshire, in January. The company will invest £1.7m to develop the pub and restaurant in Hill Avenue, creating 60 jobs. The restaurant, which will feature a Mediterranean-inspired menu including pizza and grilled fish as well as cocktails, will cater for 140 guests, reports the Bucks Free Press. Last month, Oakman Inns and Restaurants reported like-for-like sales increased 8.6% for the 26 weeks ending Sunday, 1 October with total group sales up 27.5% at £13.5m. The company operates 20 sites, including its three other Beech House venues – in Beaconsfield, Solihull and St Albans.

The Ivy Collection gets go-ahead for Cambridge site: The Ivy Collection has been given the go-ahead to open a site in Cambridge. The company has been granted permission by the city council to open the venue in Trinity Street. The grade II-listed building is owned by Trinity College and its upper floors are used as student accommodation. The Ivy Cambridge will provide seating for 140 customers, reports Insider Media. The Ivy launched its flagship eatery in Covent Garden more than a hundred years ago. The brand now has venues across the capital as well as Bristol, Bath, Cobham and Edinburgh and is preparing to launch in Cheltenham, Guildford, Harrogate, Leeds, Manchester, Tunbridge Wells, Winchester and York.

JD Wetherspoon launches Brexit beer mats: JD Wetherspoon has placed 500,000 beer mats in its pubs featuring a message to parliament. The Brexit beer mats call on MPs to endorse Wetherspoon’s three-point manifesto, which states that from March 2019 the UK should unilaterally grant rights of citizenship to legal EU immigrants; eliminate import taxes on food; and stop paying the European Union £200m per week. Chairman Tim Martin said: “David Tyler, the chairman of Sainsbury’s, recently told the Sunday Times imported food prices could rise by 22% without a ‘deal’ with the EU. This is highly misleading. Parliament has the power to reduce food prices at a stroke in March 2019. The EU imposes huge taxes on food imports from the rest of the world. World Trade Organisation rules, contrary to the urban myth, allow the UK to follow free-trade champions such as New Zealand, Australia and Singapore, which have drastically reduced or eliminated these taxes. Wetherspoon calculates it will save an average of 3.5p per meal and 0.5p per drink if we leave the EU and abolish food import taxes in March 2019 – similar savings are likely to be made on meals consumed inside or outside the home in the UK. These savings will be lost in a ‘transitional deal’ since tariffs on non-EU food will still apply. There is absolutely no doubt food prices will be cheaper without a deal if the UK chooses the free-trade option.”

London-based Chinese restaurant Jun Ming launches sister site in Victoria: Chinese restaurant Jun Ming, which is located in Colindale, north west London, has launched a sister site in Victoria. Dragon Inn Club has opened in Upper Tachbrook Street and specialises in hot pots and Sichuan cuisine. The ground-floor space is a “casual dining zone” offering dim sum, Sichuan noodles and street market-style small plates, while the lower ground floor features a bar and two restaurant spaces – the Dragon Dining Room and Hot Pot Temple Room. There is also a private dining suite and eight private booths. Head chef Qing Song Fan’s menu is a modern take on Sichuan-style cooking, including starters such as corn-fed chicken in Sichuan oil and main dishes such as sea snails with red and green chilli. The Dragon Inn Club also specialises in hot pot, with diners able to choose a soup base (chicken, chilli, seafood or vegetables) before adding ingredients such as meat, tofu, dumplings and wonton, which cook in the stock in front of them. The drinks menu includes wine and signature cocktails influenced by the Far East.

Ground Espresso to open three new sites: Northern Ireland coffee shop Ground Espresso Bars is to open three new sites. The company is opening at the newly refurbished Pump House in Portadown, Laganbank Retail Park in Lisburn, and Victoria Square Shopping Centre in Belfast. The three openings will create 40 jobs, increasing the company’s workforce to 290. Darren Gardiner, who runs the company alongside wife Karen, told Amarghi: “The coffee industry in Northern Ireland is more than able to compete with the big high-street chains. The quality and the local offer is there and we know that’s what people want.” The company currently has 18 sites in Northern Ireland as well as one south of the border, in Dublin.

Bournemouth-based operator acquires fourth site: Bournemouth-based operator Tom Russell has acquired his fourth site. Russell will launch New Orleans-style venue Bayou in Richmond Hill on the site of former Mexican restaurant Coriander, which closed in September after 30 years. Work is under way to convert the building with the new venture expected to open in December. The restaurant will serve Louisiana-style food alongside drinks and cocktails. Russell told the Bournemouth Echo: “We know there is nowhere else in Bournemouth doing anything like this – but we always try to do something we are passionate about and enjoy rather than actively look for a gap in the market.” Russell also owns Buffalo Bar in Winton, The Four Horsemen in Commercial Road, and The Anvil in Lansdowne.

Nando’s opens restaurant at £45m Weston-super-Mare leisure complex: Nando’s has opened a site at the new £45m Dolphin Square leisure complex in Weston-super-Mare, Somerset. Nando’s joins a number of restaurants at the development, including buffet brand Mimosa, PizzaExpress, Prezzo, Brazilian grill-house Preto and The Rank Group’s bingo cafe concept Luda. The complex will be anchored by an eight-screen Cineworld cinema, which will open in January. A Nando’s spokesman told Somerset Live: “We know there are a lot of peri-peri fans in Weston-super-Mare. We can’t wait to start hosting people at the new restaurant.” Nando’s has more than 1,000 restaurants across the globe, with almost 400 in the UK and Ireland.

Jamie Rollo – Merlin has ‘long runway of global growth and attractive business model’: Morgan Stanley leisure analyst Jamie Rollo has said Merlin Entertainments has a “long runway of global growth and an attractive business model". He said: “We remain ‘Overweight’ on Merlin shares. We think the company offers an attractive way to invest in the structural growth in experiences and travel, with a long runway of global growth and an attractive business model (high margins, strong underlying free cash flow). On our 2020 forecasts, which reflect most of the announced expansion, the shares trade on 12.7 times price-to-earnings ratio, 8.0 times EV/Ebitda and a 9.6% free cash flow yield (excluding expansion capex), all well below historical levels and peers. We recognise the concerns over Midway trading and the weak third-quarter performance in its other divisions, but think there is enough evidence to suggest these were caused by external factors outside its control. Still, to be conservative we have minimal like-for-like profit growth in our forecasts now yet still see a 2017-20e 14% earnings per share compound annual growth rate.”

Huddersfield-based chef entrepreneur gets go-ahead to start expansion of gourmet burger concept: Huddersfield-based chef entrepreneur Eric Paxman has had plans to open a second site for his gourmet burger concept Pax Burger approved. Paxman applied to Kirklees Council to convert a former Yorkshire Building Society branch in Mirfield, near Dewsbury. The venue is now scheduled to open in February featuring a 32-cover restaurant and central bar, the Huddersfield Daily Examiner reports. The debut Pax Burger opened in the Huddersfield suburb of Lindley in February last year. Paxman, who trained under Marco Pierre White at L’escargot in London and Australian chef Bill Grainger in Sydney, also runs fine-dining restaurant Eric’s in Lindley, which he opened in 2010. Paxman is also eyeing a third venue in the Huddersfield suburb after submitting plans for a champagne bar.

Bill’s to open restaurant at former Ed’s Easy Diner site in Plymouth this month: Bill’s Restaurants, owned by Richard Caring, is to open a site in Plymouth this month. The company will open the 2,068 square foot venue on Monday, 27 November at Drake Circus Shopping Centre in a unit previously occupied by Ed’s Easy Diner. Bill’s has more than 80 sites around the UK, with founder Bill Collison having opened the first restaurant in Lewes, East Sussex, in 2001. It launched its latest venue at the Rushden Lakes development in Northamptonshire this week.

Australasia-based aparthotel operator to make UK debut, plans ten sites in next five years: Australasia-based aparthotel operator Quest has secured its first UK site and revealed ambitious expansion plans to open ten venues across the country in the next five years. The company will invest £10m to open the aparthotel in a commercial office block in Liverpool city centre in 2019. Quest will convert the vacant office space on three floors and add a two-storey extension, creating 100 serviced apartments, a reception, conference room, gym and back-of-house facilities. Founded by entrepreneur Paul Constantinou in Melbourne almost 30 years ago, Quest has 160 aparthotels across Australia, New Zealand and Fiji. It has 27 sites in the pipeline and 12 under construction in its home markets. The Liverpool site will be its first outside Australasia. Quest director of UK development Andrew Weisz said: “Hospitality brands have a huge role to play in opening up city centre locations for business again but, against a backdrop of economic uncertainty, it is clear businesses want to spend travel budgets wisely. We’ve immersed ourselves in the UK market in recent months and can see the potential for the aggressive expansion of both our brand and the apartment hotel industry here.”

Bristol-based operator to open second site for Greek restaurant concept: Bristol-based operator George Kotsias is to open a second site in the city for his Greek restaurant Taka Taka. Kotsias will launch the venue in Bridewell Street early next year, which will be seven times bigger than its existing Clifton Triangle premises. Taka Taka serves fresh kebabs and other Greek speciality dishes including souvlaki, salads and gyros wraps. The new site, which will create 40 jobs, will also include a supermarket that will stock a selection of Greek products, building on the success of its small deli counter. Kotsias, who also owns Opa restaurant in Baldwin Street, told the Bristol Post: “We’ve done really well at our Clifton branch since opening nine years ago and our new restaurant will build on our growing popularity. It’s going to be much, much bigger and customers will be able to buy virtually any product you’d be able to buy in Greece in our new supermarket as well as being able to eat food in or take it away.”

London-based charcuterie owner launches neighbourhood restaurant: Simon Hodge, who owns The London Charcutier store in London Fields, has launched neighbourhood restaurant Hodge Podge in Crouch Hill. Hodge describes his menu as “casual, modern British”, offering dishes such as mussel broth with warm fennel salad, blackened tomato ravioli with apple and miso stock, and choux buns with black sesame, caramel, peanuts and chocolate, Hot Dinners reports. At The London Charcutier, Hodge merges classic British flavour pairings, such as beef and ale, with traditional curing methods. He makes everything by hand, bringing together local artisan producers to create products such as beef in ale, duck in sloe gin, and mackerel in cider.

Yorkshire-based Italian restaurant concept opens second site, in Harrogate: Yorkshire-based Italian restaurant concept Galo’s Kitchen has opened its second site, in Harrogate. The family-run company has opened the venue in Montpellier Street at a site previously occupied by fine-dining restaurant Van Zeller. The independent business, which specialises in home-cooked food, already runs a restaurant in Bingley. A spokesman told the Harrogate Advertiser: “We are passionate about food and cooking the finest, freshest home-cooked recipes.”

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