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SSP reports UK revenue up 19.6% in first half as trading momentum continues: SSP Group, the operator of food and beverage outlets in travel locations worldwide, has reported UK revenue increased 19.6% to £392.1m for the six months to 31 March 2024, including like-for-like growth of 14.7% and a contribution of 4.9% from net gains. The company stated: “The like-for-like growth reflected encouraging passenger numbers in the air channel and a further improvement in rail passenger volumes as commuters continued to return to work in offices, as well as a slightly lower incidence of strike action compared with last year. Overall revenue growth in the second quarter remained strong (up 16.1% year-on-year), and like-for-like growth of 12.1% remained robust, despite ongoing industrial action throughout the quarter.” Underlying operating profit for the first half of the financial year for the UK was £19.5m (2023: £18.1m), with a reported operating profit of £13.9m (2023: £18.0m). The company stated: “Operating margin was impacted by the pre-opening costs and disruption arising from the renewal programme at a number of major sites during the first half. Non-underlying operating items included impairments of property, plant and equipment (£4.0m) and right-of-use assets (£1.4m) relating to our operations in Ireland. On a pre-IFRS 16 basis, the underlying operating profit was £16.7m, which compared with £16.0m last year.” SSP said it was on track to deliver full-year expectations and was well-positioned for medium-term compounding growth and returns. Since the half year-end, the company said it has traded “in line with expectations”, with total revenue during the first six weeks of the second half (from 1 April to 12 May) up 14% year-on-year on a constant currency basis, with revenue in North America up 28%, Continental Europe up 5%, UK up 9% and APAC and EEME up 25%. Group-wide, first-half revenue was £1.5bn (2023: £1.3bn), up 19% on a constant currency basis, with double-digit growth across all regions. Like-for-like sales were up 12%. Ebitda was up from £91m to £106m. The company said profitability in continental Europe was “held back by a heightened level of renewals, particularly in the Nordics countries, and greater levels of industrial action that impacted the rail sector in France and Germany”. The company stated: “As we approach the peak summer season, we are well-positioned to deliver the planning assumptions for FY24. We continue to plan for like-for-like sales growth for the full year of between 6% and 10% and for net contract gains in the region of 5% (excluding acquisitions). Including the acquisition of ARE in Australia, which completed in May 2024, we now expect a contribution of circa 3% from acquisitions in the year. We continue to plan for underlying Ebitda to be within the range of £345m-£375m and underlying operating profit within the range of £210m-£235m, all stated on a pre-IFRS 16 basis and at constant currency based on average rates for FY23. We continue to plan for capital expenditure to be in the region of £280m in the current year.” Patrick Coveney, chief executive of SSP Group, said: “The first half has been a period of continued momentum, and we’ve made good strategic and financial progress. Our momentum is being supported by tailwinds from the high structural growth of the markets in which we operate, our proven ability to win and retain high-returning contracts and by our value creating acquisitions. Trading momentum has continued into the second half, and we are confident in delivering on our expectations for the full year. In particular, we are well set to capitalise on what we anticipate will be a summer of strong demand in all our markets – including continental Europe, where the Olympics and the European Championships will help boost footfall in airports and stations. We will also start to realise the benefit of our latest value-creating acquisition in Australia and new market entries in New Zealand and Indonesia. As a business we are making good progress on our strategic priorities, thanks to the hard work and commitment of all our colleagues and the support of our clients and brand partners around the world. With our continued momentum and foundations in place for further expansion, we remain confident in our ability to deliver sustainable, compounding growth and returns for all our stakeholders in the years to come.”

Next Who's Who of UK Hospitality to be released on Friday featuring 872 companies: The next Who's Who of UK Hospitality will be released to Premium Club members on Friday (24 May), at midday. Another 11 companies have been added to the database, which now features 872 companies. This month's edition will also include 42 updated entries. The companies, listed in alphabetical order, will have their most recent results reported as well as broader information around Ebitda, plans and trading style available. The database merges Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium Club members will also receive all the videos from this month’s Excellence in Pub & Bar Retailing Conference on Friday, 31 May at 9am. They will include Jonathan Lawson, chief executive of Liberation Group, discussing how the award-winning business has maintained its high standards while continuing to grow its mainland estate, the development of its bedrooms business as its targets a 700-bedroom division, and the integration of the Cirrus Inns business, including its entry into the London market; and Oisin Rogers talking about the creation and running of The Devonshire, the Soho-based pub that incorporates a three-metre-long bespoke wood ember grill, the first of its kind in the UK; an on-site aging chamber that is the biggest in central London; its own bakery; three dining rooms; and the extraordinary lengths it has gone to deliver the perfect pint of Guinness. Premium Club members also receive access to five other databases: the Multi-Site Database, produced in association with Virgate; the New Openings Database; the Turnover & Profits Blue Book; the UK Food and Beverage Franchisor Database and the UK Food and Beverage Franchisee Database. All Premium Clubs members will be offered a 20% discount on tickets to Propel paid-for events including Social Media for Profit (18 July), the Talent and Training Conference (1 October) and Restaurant Marketer and Innovator (two days in January 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.

Comptoir Group CEO – it will take a further two to three years before we can adjust pricing sufficiently to fully return to pre-covid Ebitda margins: Nick Ayerst, chief executive of Comptoir Group, the owner of the Comptoir Libanais brand, has said that it is likely it will take the business a further two to three years “before we can adjust pricing sufficiently to fully return to pre-covid Ebitda margins”, as it reported a 1.3% increase in full-year like-for-like revenue growth to £31.5m. The company, which currently trades from 28 sites – 22 managed and six franchised – reported total system sales for the year to 31 December 2023 of £42.4m, an increase of 6.7%, with a like-for-like system sales growth of 3%. Adjusted Ebitda stood at £0.1m (2022: £2.8m), with a pre-tax loss of £1.6m (2022 pre-tax profit of £0.6m). Over the past six months it has opened new sites in Ealing (2023) and Southbank (2024), as well as switching Cheshire Oaks from a franchised to equity model and opening a new Shawa franchise in Abu Dhabi in 2024. It said the Ealing site is trading “in line with expectations”. The company said: “In 2023 Comptoir Libanais system sales totalled £35m, with 65% originating from our equity estate and 35% from franchisees. In early 2024, we took back the Avolta franchised site in Cheshire Oaks as they refocus on travel hub operations. Simultaneously, we opened a new Shawa restaurant in Zayad International airport, our first restaurant in Abu Dhabi and first franchised Shawa restaurant. During the year we signed a new partnership with AREAS, a global travel hub food operator, and are on track to open in Milan airport this summer. With the robust performance of existing sites and recent openings trading well we will be looking to grow the number of our franchise partnerships and restaurants.” Beatrice Lafon, non-executive chair, said: “FY 2023 results reflect the continued effects of the consolidation strategy the board put in place in August 2022 to rebuild the teams after the pandemic, manage the headwinds created by the inflationary pressures on wages, ingredients and utility costs in particular whilst establishing a strong foundation for growth.” Ayerst said: “The hospitality industry has been significantly impacted by a maelstrom of economic factors which have influenced guests’ spending habits and led to higher operational costs. I expect it will take a further two to three years before we can adjust pricing sufficiently to fully return to pre-covid Ebitda margins. Nonetheless, we made progress with cost reductions in the latter part of 2023, particularly in energy management, and have continued this momentum into 2024. I am particularly excited by the work we have done to better understand our guests and our market position in Comptoir Libanais which together with our focus on consistency in food quality and hospitality has delivered like-for-like sales growth in Q1 and increasing guest satisfaction. In order to focus management’s time on growth brands we have streamlined Yalla Yalla’s operations by closing a location that doesn’t align with our future business ambitions at its lease end and aligning back of house systems in the remaining restaurant to gain operational efficiencies. Shawa continues to present a significant growth opportunity, with existing sites performing well and encouraging early results from our franchise location in Abu Dhabi. The focus for the rest of 2024 and into 2025 remains on growing covers both through our improved understanding and connection with existing guests increasing their frequency of return and encouraging trial by new guests. Across the group we continue to work on menus, labour efficiencies and cost management to improve the group’s Ebitda delivery to compelling numbers. We have confidence that our strategy will deliver top line growth, improved margins and improved profitability that will enable us to continue our new opening plans.”

SSP enters Indonesian market with new joint venture: SSP Group, the operator of food and beverage outlets in travel locations worldwide, has agreed to create a new joint venture with Indonesian food and beverage business PT Taurus Gemilang (TG). SSP will own 60% of the new company, with TG owning the remaining 40%. The move marks SSP’s entry into Indonesia for the first time and is the latest step in the company’s ongoing expansion across the high-growth Asia Pacific region. As a result of the new joint venture, SSP will operate 13 outlets, 12 of which are located at I Gusti Ngurah Rai International airport in Bali, and one at Juanda International airport in Surabaya. These are currently a mix of TG’s own brands, as well as a number of local franchised brands, including Made’s Warung Balinese restaurant and coffee brand Revolver. Patrick Coveney, chief executive of SSP Group, said: “The Asia Pacific region is strategically important for us and a key geography in our plans for growth. This new deal will provide us with an excellent foundation to develop our operations in Indonesia and will put us in a highly competitive position to secure future new business. The local knowledge of the TG team coupled with our international experience will make us a significant force in this fast-growing market.” Budi Purnomo, chief executive of TG, added: “At TG, our vision is to provide memorable experiences by showcasing the best of Indonesian hospitality. This next chapter in our history will enable us to continue to deliver an outstanding offer to passengers flying to and from Indonesia that enhances the country’s reputation as a truly remarkable destination.” The new joint venture is expected to assume operations of TG’s current units at Bali and Surabaya later this summer, subject to obtaining the necessary consents. The management team and colleagues based in those locations will transfer to the new company upon completion of the deal. The world’s fourth most populous country, Indonesia is anticipated to be the fourth largest aviation market globally by 2039. Currently Indonesia serves more than 150 airports, 14 of which welcome more than three million passengers a year. In 2019, 39.5 million passengers travelled through Bali and Surabaya airports.

Deputy governor – Bank of England could cut rates this summer: The Bank of England could cut interest rates this summer if the inflation rate moves in line with its expectations, one of its deputy governors has said. Ben Broadbent said that if inflation continued to ease in the coming months, then “it’s possible the bank rate could be cut some time over the summer”, reports The Times. The comments are the latest indication that members of the Bank’s rate-setting monetary policy committee (MPC) are edging closer to voting for a loosening of policy for the first time since March 2020, possibly as soon as its next meeting next month. The MPC voted seven to two in favour of holding borrowing costs at 5.25% last month. Figures released by the Office for National Statistics on Wednesday (22 May) are expected to show that inflation slid to 2.1% in April from 3.2% in the previous month, thanks to a sharp fall in energy prices. City analysts believe there is a chance that the rate dropped to the bank’s 2% target for the first time since July 2021. Broadbent said the risk had receded that high inflation was now embedded in the UK economy by continued rapid wage rises and companies lifting prices. He added that “the direct effect on inflation of the pandemic and the war [in Ukraine] has now faded”. However, he highlighted that it was “unclear” how long it would take for “second-round” inflationary pressures to unwind. On the other hand, he said that businesses “feel less able than they did last year” to pass through high costs via price increases, signalling that future inflation was likely to ease.

Buzz buys Britain’s biggest bingo hall, launching smaller boutique high street format: Buzz Bingo is investing millions of pounds into improving its estate after acquiring the country’s biggest bingo club and launching a pared-back bingo hall format for high street locations. The group, formerly Gala Bingo, has completed the acquisition of the giant Merkur club in Cricklewood, north west London, together with a second Merkur venue in Northampton. The terms of the deal have not been disclosed, although industry sources pointed to a likely figure of between £15m and £20m for the pair. It is buying the clubs from the Gauselmann gaming family. Chief executive Dominic Mansour told The Times the two additions had been “at the core of their communities for more than 25 years [with] a focus on a low-stake bingo offer with frequent winners”. The two businesses welcomed 410,000 visitors in total last year and have recorded a 5% increase in admissions in the year to date. On average they pay out winnings of more than £1m a month. Mansour said the deal would build on Buzz’s recent growth. Last year, it lifted retail revenues by 5%, online revenues by 31% and underlying earnings by 14%. Meanwhile, its digital business had doubled its market share over the past two years. The company is also set to test much smaller boutique bingo premises for use on high streets, the first of which opens in Borehamwood, Hertfordshire, on Tuesday, 28 May. The 3,000 square-foot site has a capacity of only 150 players. The town’s traditional bingo hall, which is 26,000 square foot, will pull down the shutters the day before. In a further development, Buzz is relocating its digital business to Gibraltar as it seeks growth opportunities internationally. The tax-efficient move is in line with rivals including Playtech, 888 Holdings, Entain and Flutter. Asked whether Buzz might follow its closest rival, Mecca Bingo, and run clubs overseas one day, he said: “We’ll take it step by step, and Gibraltar is step one. It’ll give us a platform so that when we do do it, we’ll be ready.” Buzz – then Gala Bingo – was acquired by Caledonia Investments in 2015 for £241m. It is now owned by ICG, which bought a majority stake in the business from Caledonia in 2021. In 2015 it had 130 clubs, but it has been whittled down to 83 as leases have expired, sites have been redeveloped and poorly performing venues have been closed.