M&B reports like-for-likes up 1.5% in fourth quarter, expects energy and utility costs to almost double to £150m: Mitchells & Butlers has reported like-for-like sales were up 1.5% in its fourth quarter compared with 2019 as it said its energy and utility costs are expected to have almost doubled to £150m from pre-covid levels. The like-for-like increase was again driven by food sales where like-for-likes were up 4.1% while drink like-for-like sales were down 1%. For the year ending 24 September 2022, like-for-like sales are up 1.1% on pre-covid levels with food like-for-like sales up 5.2% and drink like-for-like sales down 4.1%. However, there has been an improvement in drink like-for-like sales through the year having been down 9.1% in the first quarter, 4.2% in the second quarter and 1.3% in the third quarter. The company stated: “Like-for-like sales improved in the fourth quarter, despite the ongoing impact of extreme heat as well as further rail strikes, both of which disrupted trade. Sales over the August bank holiday were encouraging, with like-for-like growth over the three-day weekend of more than 6%, before returning to levels consistent with the quarter as a whole. Growth continues to be driven by food sales with the strongest performances in our premium, food-led brands. Total sales have declined by 1.3% in the year driven mainly by temporary covid-related closures in the first part of the year and site disposals since FY2019. Inflationary cost pressures presented an increasing challenge both to our business and to the hospitality sector as a whole through the second half of the year, initially concentrated in the areas of energy, wages and food costs but are now evident throughout most of the supply chain. The recent announcements of domestic and business energy price caps are welcomed both due to the impact on guest disposable income, and the reduction of cost downside to the business from potential further adverse market price increases. However, we expect our total energy and utility costs to have increased to circa £150m for FY2022 (FY2019: £80m) and even with the cap in place anticipate a further increase on that for FY2023. That is despite several initiatives underway to reduce our ongoing energy usage, including greater focus and review at a site level on energy efficiency, combined with investment initiatives such as the installation of voltage optimisers. We have currently bought forward approximately 20% of our requirements for the next financial year. We continue to work very hard to mitigate as much of the impact of these cost increases as we can, both through driving sales growth and identifying and implementing further cost efficiencies in the business executed under our Ignite programme of work. The group currently has cash balances of circa £160m, in addition to undrawn committed unsecured facilities of £150m. We remain committed to investing in enhancing the competitiveness of our estate. We have completed 166 conversions and remodels in the financial year to date.” Chief executive Phil Urban said: “The trading environment for the hospitality sector remains very challenging, with cost inflation putting increasing pressure on margins, and we are also mindful of the pressures on the UK consumer over the coming months. We remain focused on the delivery of our Ignite programme of initiatives, driving sales and delivering cost efficiencies. This will, combined with our diverse portfolio of well-known brands and strong estate locations, put us in a stronger competitive position to face the challenges ahead.”

One day to go before release of updated Premium Database of Multi-Site Companies, 60 businesses being added: A total of 60 new multi-site companies, operating 520 sites, have been added to the next edition of the Propel Premium Database of Multi-Site Companies, which will be released tomorrow (Friday, 30 September), at midday. The updated Propel Multi-Site Database, which is produced in association with Virgate, includes regional bar and restaurant operators, expanding hotel companies, and growing entertainment concepts. Premium subscribers will also receive a 4,100-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 2,677 companies. Premium subscribers will also receive the next edition of the New Openings Database on Friday, 7 October, 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 13,000-word report on the new additions to the database. Premium subscribers also receive access to the Propel Turnover & Profits Blue Book, which is produced in association with Mapal Group, 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 jo.charity@propelinfo.com to upgrade your subscription. Subscribers also receive access to Propel’s library of lockdown videos and 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.

Caprice Holdings builds back from covid but turnover still below pre-pandemic levels: Caprice Holdings, owned by sector investor Richard Caring, has reported turnover increased 53% to £43,386,000 for the year ending 2 January 2022, compared with £27,548,000 the year before, “driven by the reopening of all restaurants and Annabel’s members’ club following their closures in the prior period for more than 21 weeks due to covid-19 restrictions”. However, this remained below the £60,726,000 reported in the last full year before the pandemic. Adjusted Ebitda was down to £1,714,000 from £3,559,000 (2019: £9,398,000). Pre-tax losses increased to £2,736,000 from £2,220,000 the previous year. (2019: profit of £19,683,000). The company stated: “The covid-19 pandemic caused further business interruption in 2021, with restaurants forced to close early in the year and further restrictions impacting trade until May 2021. Upon reopening outdoor dining at a number of restaurants in April 2021 followed by full reopening of the whole estate in May 2021, trading was very strong with consumer confidence returning rapidly. The closure of our restaurants has required us to reduce our variable costs and fixed costs, where possible, to offset the impacts of these closures. A key fixed cost that we were able to reduce was rent, as a result of continued negotiations with landlords to obtain rent concessions for the closure period. The closures also had an impact on our employees, though we have been able to leverage financial assistance through government support schemes such as the Coronavirus Job Retention Scheme (CJRS). Despite the challenges relating to covid-19, the directors and management believe the business is well positioned to be able to navigate through the impact of covid-19 due to its available cash arid working capital position, its ability to manage its costs, and the strength and flexibility of its customer proposition.” After the year-end, three restaurant groups under the control of Caring, including Caprice Holdings, refinanced their lending facility with HSBC with an amortising loan of £120m and a two-year revolving credit facility of £70m. During the period, the company received £2,797,000 (2021: £5,122,000) through the CJRS. Directors emoluments totalled £151,000 (2021: £395,000. Staff numbers were 577 (2021: 924). No dividend was paid (2021: zero).

Fridays strengthens delivery proposition with UberEats partnership: Fridays, part of Hostmore, has partnered with UberEats, further enhancing its delivery proposition. Fridays began rolling out on the food delivery platform earlier this month and is now delivering from 81 locations across the UK. Murray Mclure, regional director at Fridays, said: “We are excited to add UberEats to our fantastic range of delivery partners. We are always looking at new ways to bring Fridays favourites to our loyal fans and the growth of our delivery proposition enables us to do just that, no matter the day of week or time of day.” Matthew Price, general manager at UberEats UK, added: “We are delighted to add Fridays to the UberEats app enabling our customers get their favourite American-inspired dishes and that all-important ‘Fridays Feeling’ delivered to their door.”