Bruce Pubs eyes rapid growth on back of £20m bond offer: Edinburgh-based Bruce Pubs is targeting acquisitions across the Central Belt on the back on a £20m bond offer. The company, which owns 19 pubs and live music venues in the capital and in Fife, said the bond offer, which was first announced in December, would enable it to rapidly grow the business. The group said it has identified a “substantial” pipeline of acquisition opportunities, including a portfolio of 11 tenanted units, as it looks to expand into areas including Glasgow. Kevan Fullerton, who founded the business in 1999 with Scott Piatkowski, said the fund-raising would enable it to take advantage of “excellent” potential for growth. He told The Scotsman: “We have the scale, expertise, and knowledge of the market to expand substantially in a relatively short timescale. The bond will give us immediate access to substantial funds, which will facilitate rapid growth.” He added proceeds would be used to quickly grow through acquisitions within its existing market and further afield. The bonds, which will be traded on the NEX exchange, will be secured on the venues and will attract 7.2% interest. Although Fullerton said the pub market had experienced contraction in recent years, recent reports have highlighted a major upturn in revenues, with growth particularly in drink sales and among independents. He added: “We are confident the pub market is ripe for expansion if the right product is offered. Our success has been in developing traditional pubs in excellent locations, which appeal to a wide group of people. This idea has worked with our existing portfolio for the past 20 years with some of our pubs recording a 40% increase in turnover during last summer. We think our model, extended across Edinburgh and into Glasgow and the Central Belt, will produce a profitable pub group, which, although centrally owned and operated, retains the individual identity and character of each pub. We are not creating a chain, we are building a group of individual pubs that nonetheless benefit from experienced management, strong financial backing, and the cost savings that a large group can command.” Its board includes former RBS banker Ken Hillen, who was also head of commercial and corporate for Scotland at Bank of Ireland until 2009.

 

Applegreen – strong pipeline of opportunities for Welcome Break, integration progressing well: Forecourt retailer Applegreen has said there is a strong pipeline of opportunities to expand motorway services operator Welcome Break and is also reviewing its hotels business. Applegreen reported Welcome Break has traded in line with management’s expectations during 2018 and integration of the business is progressing as planned. It comes as Applegreen, which acquired a majority shareholding in Welcome Break in October, reported group revenue increased 41% on to €2.0bn for the year ended 31 December 2018. The Welcome Break portfolio comprises 34 motorway service area sites, three trunk road service area sites and 29 hotels (23 co-located on service area sites and six standalone hotels) across the UK motorway network. Applegreen stated: “Welcome Break has traded in line with management’s expectations during 2018 and the integration of that business is progressing as planned. We have made a number of management changes and we are confident in delivering significant synergies from this acquisition. The hotel operations are a particular area of focus for Applegreen and there is a strategic review of this business underway currently. We have successfully transferred several Applegreen UK service areas to Welcome Break and there is a strong pipeline of motorway service areas and trunk road service areas opportunities to deliver further expansion.” Applegreen saw like-for-like constant currency growth in non-fuel (food and store) revenue of 3.3% and non-fuel gross profit of 3.1% respectively. Adjusted Ebitda increased by 46% to €58.1m, compared with €39.8m the previous year. Excluding the Welcome Break acquisition, Applegreen’s adjusted Ebitda increased by 20% to €47.8m in 2018. It opened 22 new food outlets in the year and added a further 200 through the acquisition of Welcome Break to bring the total number to 482. Chief executive Bob Etchingham said: “We are delighted to announce another strong set of results for Applegreen. The performance was driven by ongoing expansion of our estate, positive like-for-like growth despite weather related disruption and strong fuel margin performance, particularly in the fourth quarter of the year. The acquisition of the second largest UK motorway service area operator, Welcome Break, is transformational for our business. It gives us an excellent platform to develop our service area business in the UK market. The Applegreen business continued to expand in each of our three markets as we increased our estate by 130 sites to a total of 472 locations. We opened 16 new sites in the Republic of Ireland, 61 in the UK (including 43 acquired Welcome Break sites) and 53 in the US. Trading conditions remain generally good despite uncertainty caused by macro events. We anticipate another year of robust growth for the business. Our primary focus will be on the integration of Welcome Break and further reducing leverage but we will also continue to evaluate new opportunities to further expand the business in the future.”

 

Thin Cats launches £100m funding programme for private equity backed SMEs: Fintech lender Thin Cats has launched a £100m funding programme for private equity-backed small and medium businesses in the UK. The loan provider is aiming to help private equity-backed companies fund larger sized deals up to £15m. Earlier this year, it provided Flat Iron, the “single steak” dining concept backed by private equity firm Piper, with a £5m funding package. Thin Cats chief development officer Damon Walford told City AM: “Our mission is to level the playing field for British businesses whose growth ambitions are being held back by traditional lending models. We have helped a number of private equity houses with portfolio businesses and new investments over the past year and this new funding programme will provide valuable transparency, clarity and structure to support entrepreneurs with their immediate and longer-term growth plans.” Piper partner Peter Kemp-Welch said: “We are increasingly seeing alternative funders in this space and enjoyed working with Thin Cats. Its team really understood Flat Iron’s ambitions and built a package to support the business’s growth. We welcome this news and will continue to work together to support the next generation of entrepreneurs.” Thin Cats provides funding ranging from £250,000 to £15m to UK businesses, and has lent more than £400m to small and medium-sized enterprises since it launched in 2011.

 

Shake Shack tests four-day working week: Shake Shack is testing a four-day working week to help recruit and retain qualified store-level supervisors. The pilot programme has been deployed in Las Vegas, where the company operates a handful of locations including a store on The Strip. Chief executive Randy Garutti said the company is trying new ways to retain and attract qualified restaurant-level leaders as it grows across the country, reports Nation’s Restaurant News. Speaking at the JP Morgan Gaming, Lodging, Restaurant & Leisure Management Access Forum, he said: “It has never been harder to find great people to lead great restaurants. If we can figure that out (how the four-day week would work) on scale, it could be a big opportunity. We’re not promising it yet, but it is something we’re having fun trying and seeing how our leaders like it on a recruiting basis.” The pilot comes as Shake Shack manages rapid growth. In the final quarter of 2018, it opened 20 restaurants. This year, it plans to open 36 to 40 company restaurants and 16 to 18 licensed sites in the US. Garutti said the company could be opening up to 100 sites a year, as it is bullish on growth. But he added in a tight labour market, it is hard to find that many well-trained managers needed to maintain the company’s high standards of hospitality and service. Shake Shack has more than 200 restaurants.

 

BigDish launches in Southampton, targets Brighton and Exeter: BigDish, the company that operates a yield management platform for restaurants, has launched in Southampton and is now set for Brighton and Hove. The company expects to push into the East Sussex city in April or May for the start of its “territory three” push, of which further towns will be identified in due course. BigDish is also considering expanding into Exeter in April or May as part of “territory two”, which also includes Bristol, Gloucester, Bath, Swindon, Oxford, Windsor, Slough and Plymouth. The company has also partnered with digital agency Loud Mouth Media to “drive campaign performance, app promotion and building the BigDish brand and usage across the UK”. BigDish chief executive Sanj Naha: “I am pleased with the pace of new restaurants signing up to BigDish. We expect this to continue to gather pace as we grow. This next stage of launching consumer marketing initiatives is a key component of our strategy and we are excited to partner with Loud Mouth Media who have a proven track record in digital advertising. Everything we have done at BigDish over recent months has been focused on moving towards the goal of building a launch pad to enable rapid growth across the UK.”