Sector braces for Budget onslaught: Sector businesses are braced for a Budget onslaught that they claim will drive up costs and threaten livelihoods. Chancellor Rachel Reeves will today (Wednesday, 30 October) hit corporate Britain with an increase in employer national insurance contributions of up to 2p having previously branded the levy a “tax on jobs”. As well as the national insurance increase – which could raise as much as £20bn – and a workers’ rights package costing firms £5bn a year, ministers have announced a 6.7% rise in the minimum wage to £12.21 per hour with a 16.3% increase for under-21s to £10 an hour, leaving business facing yet higher costs. Nick Mackenzie, chief executive of brewer and retailer Greene King, told The Mail: “There are some cost increases coming through that are hitting our industry and hitting our businesses, and potentially having an effect on our ability to invest in growth in the long term.” Xiaowei Xu, senior research economist at the IFS, said: “If the government enacts a combination of a rise in the minimum wage, an increase in employer national insurance and the worker rights bill, businesses may respond by reducing employment.” The hospitality sector is also facing a £2.5bn increase in its business rates bill when covid-era support expires at the end of March next year. Business leaders warned an increase on this scale – while they struggle with rising wages and taxes, as well as new red tape on workers’ rights – would force many to put up prices or shut down. Mackenzie warned of a “cliff edge that could be really damaging to pubs”. The sector has long demanded sweeping long-term reforms of the “broken” rates system to make it fit for the future. But industry sources expect to be disappointed with a vague announcement of merely another review or consultation. Chris Jowsey, chief executive of Admiral Taverns, said: “It is incredibly important the government not only provides an extension to the small business rates relief, but a reform of the unfair business rates system at the Budget today.”

Premium Club members to receive updated segmented Multi-Site Database featuring 784 pub and bar operators on Friday: Premium Club members are to receive the Multi-Site Database on Friday (1 November), at midday. The next Propel Multi-Site Database provides details of 3,264 multi-site operators and is now searchable in seven main segments. The database features 961 (29%) operators from the casual dining sector, 784 (24%) pub and bar operators, 548 (17%) cafe bakery operators, 445 (14%) quick service restaurant operators, 267 (8%) hotel operators, 204 (6%) experiential leisure operators and 54 (2%) fine dining operators. It is updated each month and this edition includes 21 new companies. New additions to the pub and bar sector include Three Hills Brewery, operating taprooms in Northamptonshire, and Glasgow nightclub operator Dawncrest. Premium Club members also receive access to five additional databases: the New Openings Database, the Turnover & Profits Blue Book, the UK Food and Beverage Franchisor Database, the UK Food and Beverage Franchisee Database and the Who's Who of UK Hospitality. All Premium Clubs members will be offered a 20% discount on tickets to Propel paid-for events including Restaurant Marketer and Innovator (two days in January 2025) and Excellence in Pub Retail (May 2025). Operators that are Premium Club members are also able to send up to four members of staff to each of our four Multi-Club Conferences for free. Premium Club members receive their daily Propel Info newsletter 11 hours earlier than standard subscribers, at 7pm the evening before. They also receive videos of presentations at eight Propel conference events two weeks after they are held. This represents around 100 videos of industry insight over the course of the year. Premium Club members will be sent a dedicated monthly newsletter that will highlight key updates in the sector and direct subscribers to all the vital content their membership offers. Premium Club members also receive exclusive opinion columns every Friday at 5pm, which include the thoughts of Propel group editor Mark Wingett and a host of industry leaders from across the sector. A Premium Club subscription costs an annual sum of £495 plus VAT for operators and £595 plus VAT for suppliers. Companies can now have an unlimited number of people receive access to Premium Club for a year for £995 plus VAT – whether they are an operator or supplier. Email kai.kirkman@propelinfo.com today to sign up.

Time Out to raise £8m as it plans new markets in London and New York: Time Out Group is planning to raise £8m to fund two new potential markets in London and New York, and to accelerate media technology investments. The funds are being raised through a share placing and will represent about 5% of the company’s existing issued share capital. The group stated: “It is expected that the net proceeds of the placing will be utilised primarily to support market expansion via two new owned and operated markets in top-tier world cities as well as investing in technology developments. The company believes that these investments have the potential to deliver, in aggregate, more than £2m Ebitda in FY26, with potential for further benefit in FY27 of more than £3m and FY28 of more than £4m. In London – the city in which Time Out first launched more than 50 years ago – the company is proposing to open a new market in excess of 20,000 square foot [at 10 Piccadilly] in an area with high footfall from both locals and tourists. An initial cash outlay of £2.6m for the rent deposit (and associated fees) secures a 15-year lease of the site and anticipated handover is in 2026, with opening expected in 2027. Ebitda payback is expected in three years post-opening, excluding the opportunity of a significant potential media revenue halo and sponsorship opportunities. Time Out also intends to enter into a ten-year (with an option to extend to 20-year) lease over a circa. 10,000 square-foot existing food hall in New York. This site is targeted to reopen as a Time Out Market in summer 2025. It will cost the Company circa £2m to secure the site (a combination of rent deposit, capex and associated fees). The company believes the new market has the potential to be Ebitda-generative in FY26, with payback targeted in two years post-opening, which excludes potential significant revenue synergies with Time Out New York Media. The company has not entered into any legally binding arrangements in relation to either site, so there can therefore be no certainty that the current negotiations will result in subsequent openings. As a globally recognised brand, there is the opportunity for Time Out to leverage artificial intelligence to extend its audience reach and the company intends to make an investment of approximately £3.4m in technology developments.” It comes as Time Out reported revenue from its market operations fell 6% to £67,207,000 for the year ending 30 June 2024 compared with £71,511,000 the previous year. Adjusted Ebitda was up 87% to £12,033,000 from £6,437,000 the year before. The company stated: “During the year, new markets were opened in Cape Town in November 2023 (management agreement) and Porto May 2024 (owned and operated). The owned and operated Barcelona market opened shortly after the year-end in July 2024. All three have strong chef line-ups, including chefs with a combined total of nine Michelin stars. Two new management agreements, Bahrain and Budapest, were announced in the year which, in addition to Vancouver and Osaka, are expected to open within the next 12 months. In total, our 16 markets are expected to generate more than 20 million transactions per year. The remaining opening schedule based on calendar year is as follows: Abu Dhabi (2025)and Prague and Riyadh (both 2027). We have a strong pipeline of management agreements in negotiation and expect to sign more in the year ahead as we continue to optimise our systematic approach to sourcing high-quality leads. As we grow our portfolio of open markets, we continue to refine selection criteria based on proven critical success factors, with the objective of improving return on investment and reducing time to completion.”

Details of Camerons Brewery refinancing revealed as it plans to accelerate growth of pub estate: Details of north east brewer and pub operator Camerons Brewery’s refinancing this month have been revealed as it plans to accelerate growth of its pub estate. Propel reported this week that Camerons had completed a deal with new funder Sandton Capital Partners to allow it to re-establish its strategic expansion. Further details of the arrangement have now been revealed in Cameron’s accounts for the year ending 31 December 2023. They showed as part of the deal, £11.2m of the company’s original outstanding debt of £25.2m has been written off and facilities of £15m have been extended until December 2026. Chief executive Chris Soley said: “Net debt to Ebitda has materially reduced from 5.9 times to a projected 2.7 times by December 2024. This significant reduction of write down of our debt, which results in much lower debt service costs, means growth can now be accelerated. We are now able to re-establish the strategic expansion of our national flagship Head of Steam pub brand alongside our Urban Country Pubs estate, which was borne out of the acquisition of the Leeds Brewery pubs.” It comes as Camerons reported turnover fell slightly to £61,552,307 in 2023 compared with £62,047,080 the previous year with the business selling 26 tenanted freehold sites to FB Taverns in June 2023 for £8.5m – known as Project Lion. Of the 2023 turnover, £31,130,025 came from brewing and associated trades (2022: £31,934,373), £30,344,715 from pub operations (2022: £30,036,694) and £77,567 in rent (2022: £76,013). Ebitda was up to £4.3m from £2.8m the previous year. Pre-tax losses narrowed to £547,660 from £5,515,119 the year before. The total number of pubs at the year end stood at 47 compared with 75 the previous year due to the Project Lion sale and exit of two Bar Soba leases. One freehold pub has been sold since the year end and two more units are expected to be sold before December 2024. In his reported accompanying the accounts, Soley stated: “Our now largely managed estate has traded robustly, and it is pleasing to see our bigger city centre venues enjoying the extra footfall arising from more employees returning to their respective offices to work rather than from home.” The company employs around 650 staff.

Chipotle interim CEO – we’re beginning to see promising results in Europe where there’s a sizeable growth opportunity: Scott Boatwright, interim chief executive of Chipotle, has said it is beginning to see promising results in Europe under the region’s new leadership team and will be a sizeable growth opportunity for the brand in the coming years. In April, Propel revealed Chipotle had promoted Anat Davidzon, formerly Chipotle managing director Canada, to managing director international, overseeing both Canada and Europe, including the UK. Jacob Sumner remained director of European operations, reporting to Davidzon. Last summer, Chipotle appointed Ben Williams, who has been with the company for almost 20 years, to managing director Europe, after previously being a regional vice-president in the US. Speaking about the group’s European business, which also includes sites in France and Germany, after the group’s third quarter update where it reported revenue increased 13% to $2.78bn, Boatwright said: “Under the new leadership team we are beginning to see promising results. We have better aligned our culinary menu to the North American standards and we are in the process of fully unlocking the functionalities of our operational tools to better manage labour and food costs. Additionally, similar to our successful strategy in Canada, we are rolling out local and digital marketing initiatives that are building brand awareness and bringing more guests into our restaurants. The recent performance gives us confidence that we can begin to build our restaurant pipeline for the future. And I'm optimistic that Europe will be a sizeable growth opportunity for Chipotle over the coming years. We could have hundreds of restaurants in the markets in which we operate today and potentially thousands in western Europe over time.” Boatright, who has stepped into the role of interim chief executive after Brian Niccol left to take charge of Starbucks, also said the company had no plans to move into franchising in the UK, where the brand has 21 restaurants. He said: “We will continue to own our presence in western Europe as well as North America. We think that's the greatest way to drive value for our brand and for our shareholders.”