WatchHouse closes funding round after raising ‘record’ amount of more than £7.2m: Specialty coffee concept WatchHouse has closed its final crowdfunding campaign early after raising more than £7.2m, in what is thought to be a record for the highest ever single equity crowd raise for a food and beverage business. Only launched last week (1 May), the 19-strong business has raised £7,234,589 from 1,432 investors. It had raised more than £6.1m in its first day. The Roland Horne-founded business, which opened its first international site, in New York, last month, launched its final EIS raise through Crowdcube with a pre-money valuation of just under £39m. The company, which opened a new site in Hampstead last week, is planning to open a second site in New York, in The Chrysler Building, this October. With the new funding, it also plans to build a state-of-the-art roastery and bakery space in Brooklyn, to serve its houses in New York City, and a new bakery adjoined to its roastery in London Bridge. The company has further openings lined up in London, in Fitzrovia in July, and a further site in Canary Wharf in August. The business said it was also exploring global franchise opportunities and Propel understands that it is in talks with partners to launch in South Korea and the Middle East, as part of a new international franchise programme. Last December, WatchHouse completed a $10m (£7.9m) Series A fundraising round to continue the company’s rapid growth in the UK and US over the next 36 months.

Brighton Pier Group expects to make £4.6m from sale of three sites, refinances and pays off covid loans, lfl sales 5% down so far in 2024: Brighton Pier Group has said it expects to make £4.6m from the sale of three sites – with Brighton and Cambridge already sold and Manchester also set to be disposed of this year. This will offset the £4.9m impairment charges relating to the three sites reported in the group’s accounts for the year to 24 December 2023 and “positively impact 2024 reported earnings”, the group said. The group also completed a refinancing and paid off its covid business loans and said like-for-like are sales 5% down so far in 2024. However, it said trading this year is anticipated to be in line with market expectations and it has taken a number of positive steps across its four divisions to “enhance the group’s proposition going forwards”. Non-executive chairman Luke Johnson said: “On 20 December 2023, the group completed the second stage refinancing of its borrowing facilities, replacing its £10.9m term loan and £1.0m revolving credit facility with a larger £5.0m revolving credit facility and a reduced term loan of £6.9m. These new facilities provide the group with additional operational flexibility and will provide the opportunity to reduce its interest costs going forward. The new facilities expire on 31 December 2027. The group also made a final repayment on its Coronavirus Business Interruption Loans during 2023, with £5.0m of loans received having now been repaid in full. As at 24 December 2023, the group had total cash and cash equivalents of £4.0m (2022: £4.2m). Trading has been subdued for the first 18 weeks of 2024 at 5% below the comparable period in 2023, as household disposable incomes remain under pressure. Unhelpful weather conditions have also persisted in the early months of the year. However, there is scope over the summer to recover this position, especially when coupled with the savings from the disposed bars, the proposed introduction of a £1 admission charge for the Pier for all non-residents of Brighton and the encouraging early trading from Lightwater Valley in 2024. We therefore believe that we will be able to manage the challenges of this current market, with the group in a stronger position than at the start of 2022. However, we need the economic headwinds from high inflation and interest rates to abate, in order to move from a conservative to a more positive outlook for the group.” The group said: “Current group like-for-like sales for the first 18 weeks of 2024 were down £(0.5)m or 5% below the equivalent period in 2023. The notable highlight so far has been Lightwater Valley, which at total sales of £0.8m is £0.3m ahead of last year. The division benefited from the sunny weather across the Easter holiday period. The Bars division continues to experience challenging trading conditions, with total sales of £1.8m, down £(0.2)m against 2023. The Golf division has benefited from the poor weather with sales for the 18 week period in line with last year at £2.4m. By contrast, the Pier was hampered by poor weather in the early months of 2024, with Brighton experiencing record levels of rainfall in February. Total sales of £3.4m were £(0.6)m lower than the equivalent weeks in 2023. Whilst trading was slightly below the prior year equivalent in the first 18 weeks of 2024, there remain opportunities from the busy summer trading period ahead. Furthermore, when coupled with savings from the disposed bars, admission charging on the Pier and encouraging early sales in Lightwater Valley, we believe the shortfall from the first 18 weeks can be recovered. Whilst the rate of inflation has eased over the previous year, high interest rates and living costs continue to weigh on consumer discretionary spend. Coupled with disappointing weather in the early months of 2024, footfall was affected across the group's trading estate. Despite these challenges, all four divisions have remained resilient and continue to generate positive Ebitda. Furthermore, the group continues to execute a number of actions that will impact positively on earnings for the current year. In the Bars, the disposal of three loss-making sites at the beginning of the year (namely Brighton, Cambridge and Manchester), together with savings in overhead, will improve the profitability of the division going forward. On the Pier, the group intends to charge for admission during peak trading periods in the summer. This fee, which will not apply to local residents, will allow us to continue to invest in the structure of the Pier and additionally to contribute to its ever-increasing operating costs. Brighton Palace Pier is an iconic landmark in Brighton which attracts tourists from all over the world and these visitors also contribute significant revenue to the city as a whole. Lightwater Valley has undergone a number of improvements over the closed winter period, and early trading in 2024 has been promising. Planning variations have recently been approved for a mixed-use development for lodges, pods and camping areas in the grounds of the Park. The group looks forward to realising this exciting additional revenue stream in the years ahead. Finally, the Golf division continues to trade well and we believe there is further potential to expand this division with new sites when suitable opportunities arise.” It comes as the group reported revenue of £34.8m for the period, adjusted Ebitda of £4.3m and a pre-tax loss of £0.6m. It said the 2022 figures are not comparable as these were for an 18-month period, ending 25 December 2022. In that period, the group reported revenue of £58.9, adjusted Ebitda of £13.8m and a pre-tax profit of £7.2m. “Overall, trading conditions were challenging for the business, with cost of living pressures softening consumer demand, most notably in the Bars division, as well as poor weather, train strikes and a fire at the Royal Albion Hotel impacting footfall to the Pier during key trading periods,” the business said. Chief executive Anne Ackford added: “In spite of a number of operational challenges experienced during 2023, the group delivered a resilient underlying trading performance. While the outlook must continue to be one of caution until economic conditions improve, the plan to trial charging for admissions to the Pier during peak trading periods, the rationalisation of the loss-making sites in the Bars division and the ongoing lodges project at Lightwater Valley are all important developments that should enhance the group’s ability to successfully navigate the challenges faced.”

JD Wetherspoon third quarter lfls sales up 5.2%, younger generations turning to Guinness: JD Wetherspoon has reported that its like-for-likes sales for the 13-week period to 28 April 2024 increased by 5.2% compared to the same period last year, and were up year-to-date (YTD) by 8.3%. It said that total sales increased by 3.3% in the quarter and by 6.5% YTD. The company said that the last week of the period last year included a bank holiday weekend, whereas this year the bank holiday was a week later, and excluding that week, like-for-like sales for the first 12 weeks of the period increased by 6%. In the year-to-date, the company has opened two pubs and sold or surrendered to the landlord 18 pubs. It said that most of the pubs were smaller and older, or where the company has a second pub in reasonably close proximity. There was a net cash inflow of £6.8m from the 18 disposals. The company said 17 trading pubs remain on the market or are under offer. It currently has a trading estate of 809 pubs. As at 28 April 2024, the company’s net debt was £685m. Tim Martin, chairman of JD Wetherspoon, said: “Sales in the period continued the steady recovery from the pandemic. Traditional ales, which were very slow in the aftermath of the lockdowns, are increasing momentum, with Abbot Ale, Ruddles Bitter and Doom Bar showing good growth, as indeed are ales from the many small and micro brewers with which we trade. The gods of fashion have smiled upon Guinness, previously consumed by blokes my age, but now widely adopted by younger generations. Also selling well among younger generations are Au Vodka from Swansea and XIX flavoured vodkas, the latter promoted by the hugely popular Sidemen. Wine has been on the comeback trail, with Villa Maria Sauvignon Blanc, from New Zealand, popular among Wetherspoon representatives of the chattering classes. Sales of Lavazza coffee are also increasing. Free refills are thought to be responsible for spontaneous exhibitions of breakdancing among retired customers. Our new menu, launched last week, has had a promising start, with some kindly reviewers comparing new dishes favourably with respected competitors. The company expects profits in the current financial year to be towards the top of market expectations.”

XP Factory reports ‘strong lfl sales growth’ across both its brands: XP Factory, which operates the Escape Hunt and Boom Battle Bar brands, has reported strong like-for-like sales growth was delivered across both its brands in the 13 weeks to 31 March 2024, following “an exceptional year” in 2023. It said that during the quarter, Boom Battle Bar sales were up 11.6%, with Escape Hunt up 11.7%. The business said that group turnover in the 15 months to 31 March 2024 stood at £57.8m (12 months to Dec 2022: £22.8m). It said that its overall performance has been in line with market expectations for the financial year to 31 March 2024. It said: “The group experienced a strong end to the financial year, supported by double digit like for like growth in the three months to 31 March 2024, in line with the board’s expectations. Group turnover for the 15 months to 31 March 2024 grew to £57.6m (12 months to Dec 2022: £22.8m), up over 80% on the comparable 15-month period.  As stated in our interim results for the 12 months to 31 December 2023, the increase reflects robust like-for-like growth, the full year inclusion and maturing of sites opened in the latter part of 2022, and expansion of the owner operated estates of both Boom and Escape Hunt.” The company said that Escape Hunt had another strong period of trading, ending an exceptional fifteen months. Like-for-like sales growth within the group's owner-operated estate was 11.7% in the 13 weeks to 31 March 2024 (13% in the UK). Total sales within the owner operated estate were circa £17m. Sales from its Boom Battle Bar owner operated estate were circa £36.5m (12 months to Dec 2022: £9.5m), with like-for-like sales up 11.6% in the 13 weeks to 31 March 2024. Franchise revenue for the 15-month period was circa £2.3m (12 months to Dec 2022: £2.8m), reflecting underlying growth offset by the group’s smaller estate, as sites have been bought back, and the inclusion in the 2022 numbers of £900,000 revenue relating to the sale of a pre-built franchise unit. The company said that its overall performance is in line with market expectations for the 15 months to 31 March 2024. Richard Harpham, chief executive of XP Factory, said: “The group’s continued strong performance in the final three months of the financial year culminates a period of exceptional growth and development within the business. Trading in April has continued the positive momentum. Our investments into new sites are generating industry leading returns, setting the business well to generate growth in shareholder value and providing the blueprint to continue our expansion.”

Garrick Club votes to admit women for first time in its 193-year history: The men-only Garrick Club has voted to allow women to become members for the first time in the London institution’s 193-year history. The landmark decision comes after celebrity figures such as Stephen Fry and Sting threatened to quit unless members pledged to allow women into the male-only space. Broadcaster John Simpson also said he and many others “would also find it impossible to stay” if doors the change was not made, reports The Daily Mail. Also among The Garrick’s 1,300 members are King Charles, deputy prime minister Oliver Dowden and actor Hugh Bonneville. The vote was passed with 60% in favour following two hours of debate on Tuesday night (7 May). It comes after a series of high-profile members last week signed a document which warned members were in an untenable position because of the “very public controversy” over claims of sexism. In March, a letter was written to the £1,700-a-year club calling for a number of high-flying women to be permitted to join. Eminent women reportedly recommended for the club include Juliet Stevenson, Dame Mary Beard, Baroness Ayesha Hazarika and Cathy Newman. An open letter was sent to the club at the time, calling on it to improve its diversity and saying it had, for too long, “stood as a symbol of exclusivity, a bastion of power maintained by the privileged few”. Prior to the vote, the institution, which is one of the oldest in Britain, repeatedly blocked attempts to allow women to join. In 2011, Joanna Lumley tried unsuccessfully to become the first female member when she was proposed by Bonneville. The Garrick was founded in Covent Garden in 1831 as an organisation for actors, theatre patrons and “men of refinement”. Until now, women were allowed in only if they are invited by a member and accompanied by a man throughout their visit. Several high-profile members quit earlier this year, including the head of the civil service, Simon Case.

Bank rules ‘could harm small firms’: New lending rules intended to make banks more resilient would drive up the cost of borrowing for small companies and leave the UK as an international outlier, MPs have warned. The Commons Treasury committee said the Prudential Regulation Authority should scrap proposals to end preferential treatment for small business loans, warning that this could lead to British small businesses falling behind their European and American competitors.The planned reforms to banks’ capital treatment of business debt “could make it harder for British SMEs to compete internationally, as no other major jurisdiction is putting such strict requirements on lending”, MPs warned in a new report. The proposals from the Prudential Regulation Authority, which is part of the Bank of England, form part of a broader package called Basel 3.1 intended to improve the strength of banks and to make firms’ capital ratios more “consistent and comparable”, reports The Times. The plans include the removal of the “SME supporting factor”, a rule introduced across the European Union in 2014 that allows banks to reduce capital requirements for small business loans. “Other jurisdictions like the United States and European Union are also not pursuing as strict an interpretation of Basel with regards to SME lending, so removal of the SME support factor risks putting the UK out of step with international peers and competitors, with negative consequences for the competitiveness of the UK market,” MPs said. Last year, Oxera, a consultancy commissioned by Allica Bank, said that the removal could reduce small business lending by up to £44bn and may increase capital requirements for small banks by a third. NatWest and smaller lenders including Allica and Handelsbanken gave evidence to the committee that removing the supporting factor would make lending more expensive. The British Chambers of Commerce has warned that “EU and US banks could use their UK branches to undercut UK banks in their service provision” if the plans go ahead. The Federation of Small Businesses has said that the plans could “compromise the ability of SMEs to scale up and create jobs”. The Bank of England has said it is considering the objections. The Treasury committee said: “At a time when costs are tight and acceptance rates for finance low, anything that unnecessarily damages the availability of finance to SMEs is unacceptable. This will drive up the cost of finance for SMEs and may restrict the supply of lending as banks shift their loans away from the market. The PRA must ensure that the final implementation of the Basel 3.1 standards leaves capital requirements on SME lending no more stringent than they are under the current system, and that international competitiveness with the EU and the US is not harmed.”