Thu 17th Oct 2024 - Marston’s outlines plans for five differentiated pub formats, appoints new COO Marston’s outlines plans for five differentiated pub formats, appoints new COO: Marston's has said it sees the opportunity for five differentiated pub formats as it looks to drive a “high-margin, highly cash-generative local pub company” with the purpose of “shared good times”. The formats are “locals”, “locals sport pub”, “adult dining pub”, “family pub” and the “two-room pub”. Outlining its strategy at its Capital Markets Day, Marston’s, which has 1,339 sites nationwide, said it would “create a balanced portfolio across consumer segments”. To drive the delivery of the strategy, Marston’s has added two new executive roles to the team. Neil Campbell, previously of Whitbread and SSP Group, has joined as chief operating officer while Ed Hancock has been appointed to the new role of chief development officer to develop and deliver the differentiated formats. The “locals” segment will be aimed at regulars and locals between the ages of 35 and 64 to “share good times at your local” and will make up roughly 23% of the estate. The “locals sport pub”, under the name of Grandstand, will be aimed at “regulars and locals entertainment focused adults” under the proposition of “the big event shared at your local with cutting-edge technology” and make up about 20% of the portfolio. The family pub segment, under the name Woodies, will be aimed at families with primary school children under the proposition of “sharing good times with the family” and will have an 18% indicative share of the estate. The adult dining pubs, under the Signature Pub Collection, will be aimed at affluent adults between the age of 35 and 64 under the proposition of “good food, good times” and make up around 22% of the company’s pubs. The “two-room” pub will be under the proposition of “shared good times for everyone” and form around 17% of the portfolio. The Acorn in Accrington has been revamped as a “two room” pub that has resulted in a 31% uplift in guest numbers and a 30%-plus return on invested capital. Marston's said its five formats will help meet the expanding range of occasions in UK pubs and the increasing importance of “low tempo” (midweek and earlier hours) visits, which are up 8% in 2024 on last year. Meanwhile, “high tempo” (weekend and later hours) visits are down 15% year-on-year. Marston's said with “time together being more important than ever”, pubs continue to play a huge role in UK socialising with the UK pubs and bars market forecast to grow total revenue from £28.4bn in 2023 to £32.6bn in 2028. The company said it has “good fundamentals to build on” with its 90% community pub estate and “balanced management model” (30% managed, 55% partnership and 15% tenanted). But this was a “new chapter” for the company “as a leading pure-play hospitality business” giving it a “simplified and focused pub operating model with a clearly defined growth strategy”. With a “revitalised” management team, Marston’s said it will see key value drivers established to enhance operational performance and drive growth through accelerated investment capex across five distinct formats. The group said it has a stable balance sheet with reducing leverage and the opportunity to refinance “for greater flexibility in due course”. Marston’s said it has no material need to refinance for ten years. New financial targets will include “market-beating” revenue growth, sustained Ebitda margin expansion and £50m-plus recurring free cash flow. The next two years will focus on delivering investment capex projects that will lead to a “format-led portfolio thriving” in 2027 and “targeted” pub acquisitions. Marston's said its “shared good times” purpose will be achieved with the “best service” (a friendly and authentic local with teams embedded in the community), “best environment” (welcoming vibrant atmosphere with free flowing and sociable layout) and “best product” (leading drinks brands, sector-leading food menus and entertainment for every occasion). Marston’s features in the Propel Turnover & Profits Blue Book, the next edition of which will be available exclusively to Premium Club members tomorrow (Friday, 18 October) and feature 994 companies. Marston’s turnover of £872,300,000 for the year ending 30 September 2023 is the 18th highest in the database. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email kai.kirkman@propelinfo.com to upgrade your subscription.