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Wed 18th Dec 2024 - Update: Wingstop, Shake Shack, Dalata and Shepherd Neame |
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Wingstop UK – lfl trading has ‘accelerated’ in 2024, swings back to profit following 122% revenue growth and reviewing whether to repay shareholder loans: Wingstop UK, which is being rolled out here by Lemon Pepper Holdings, has said its like-for-like trading has “accelerated’ in 2024”, having swung back to profit following 122% revenue growth, and is reviewing whether to repay its shareholder loans. The company, which this summer hired Goldman Sachs to find new investors in response to unsolicited expressions of interest from potential buyers, opened its first UK store in 2018 and is set to end the year with 57 locations here. In its accounts for the year to 31 March 2024, director Paddy Bamford said: “The group continued its expansion, and the directors are confident in the growth plans going forward in all territories. Despite the macro headwinds we have been facing in terms of inflationary pressures on utilities, labour and cost of sales, the group has been able to maintain and improve profitability across its estate. This was only possible because of the loyalty and dedication of our workforce. Revenue increased in the period by 122% to £84.7m (2023: £38.2m), driven by an increase in store count (12) and strong like-for-like growth of 51.3%. Since the period end, like-for-like trading has accelerated. For the calendar year 2024, like-for-like sales have increased by 59.4% (January to October). Group Ebitda increased to £8.7m, from £1.1m in 2023, excluding pre-opening costs. Group operating profit in the period rose to a profit of £4.1m (2023: loss of £1.5m), due to good cost controls underpinned by strong sales. At the balance sheet date, the Group had gross assets of £32.6m (2023: £18.3m). We have a robust balance sheet and continue to see opportunities for new sites across the UK. Since period end, we have opened a further 14 sites.” The group saw a pre-tax loss of £2,036,784 in 2023 turn into a profit of £3,555,835 and said in the accounts that due to its profitability, it is considering paying back shareholder loans. “The group was initially funded through shareholder loans, included in Lemon Pepper Midco’s balance sheet as a long-term creditor of £10,360,294 as at 31 March 2024,” it said. “The group’s ability to repay these amounts is ultimately dependent on the continued profitable trading of the business. Given the current profitability of the business, it will be reviewed whether to repay these in the near future. The directors are confident that sufficient profits will be made to achieve this based on the continued growth of the business. In addition, the business has a revolving credit facility with its bank.” Average monthly employee numbers rose from 725 to 1,230 during the year. No dividends were paid. Since Wingstop UK signalled its intention to find new investors in August, US private equity firm KKR and Domino’s Pizza have emerged as two of four bidders circling the business. KKR backs PureGym, Britain’s biggest health and fitness club operator, while Domino’s told investors a year ago that it was looking to acquire a second brand that has a “significant growth runway”. The FT reported that Sixth Street, the US investment group that also owns the American Wingstop franchisee Far West Services, and TSG Consumer Partners are the other bidders. Bids for the business were due on Monday (16 December). Wingstop UK features in the Premium Club Turnover & Profits Blue Book, the latest edition of which was sent exclusively to Premium Club members last Friday (13 December), featuring 1,039 companies. Its turnover of £84.7m in the year to 31 March 2024 is the 131st 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.
Discover how to grow sales through menu insights at Restaurant Marketer & Innovator, open for bookings: Discover how to grow sales through menu insights at the Restaurant Marketer & Innovator European Summit. Steven Pike, managing director at HGEM, will share data-driven insights into menu optimisation. He’ll explore how to decide which dishes to add or remove, the ideal menu length, and how reliable sales volume is as a success indicator. Pike will then be joined by Lizzie Isles, head of food and drink at Côte Brasserie, Claire Scullion, managing director of The Menu Scientist, and Chris Stagg, brand director at Peach Pubs, to offer practical strategies for improving menu performance and guest satisfaction. Restaurant Marketer & Innovator European Summit is returning for its seventh edition, and tickets are now on sale. The event is a partnership between Propel and Think Hospitality, aiming to build a community, promote the sharing of ideas, recognise talent and define the future of eating out. Bookings are now open for the two-day conference as the centrepiece of the January event series, taking place on 21 and 22 January at One Moorgate Place in London. The conference will focus on technology, marcomms strategies, proposition, brand building, the latest market insights, digital developments and diversification of revenue streams. It is designed for customer-focused chief executives, marketers, technology and innovation teams, as well as investors wanting to better understand the latest marketing, innovation and development opportunities to build market share and grow. For the full speaker schedule, click here. The pre-Christmas early-bird prices are as follows: a one-day ticket for operators is £295 plus VAT while a two-day ticket is £550 plus VAT. Supplier tickets are £395 plus VAT for one day and £700 plus VAT for two. Propel Premium Club members receive a 20% discount. To book, email kai.kirkman@propelinfo.com.
Ex-HOP MD Richard Franks to head up Shake Shack in the UK: Richard Franks, the former managing director of Vietnamese street food concept HOP and Mexican brand Chilango, is to head up Shake Shack in the UK. Franks, who stepped down as managing director of HOP earlier this summer after two years in the role, is to become UK business director for Shake Shack UK’s parent company Diverse Dining from next month. He joined HOP in the summer of 2022 after two and a half years as managing director of Chilango and overseeing its acquisition by Tortilla. Prior to that, he spent four years as the Mexican brand’s operations director. He was also formerly managing director of Apostrophe Cafes and spent a year at Harris + Hoole, and before that, almost eight years at EAT. Last week, Shake Shack opened its latest UK site, its 17th, in Birmingham’s Grand Central shopping scheme, adding to its other regional locations in Cardiff and Oxford. Shake Shack also has 12 London sites plus restaurants at Gatwick airport and Lakeside in Essex. The brand is also set to open on the former RBS premises at 78 Notting Hill Gate, and on the ex-YO! Sushi site in Cambridge.
Dalata – NI and NLW increases set to add 5% to payroll in 2025, secures €600m debt package after refinancing: Irish hotel operator Dalata has said that the national insurance and national living wage increases are set to add 5% to payroll in 2025, and that it has secured a €600m debt package after refinancing. In a trading update, the group said: “Trading has remained robust and, coupled with the positive impact of recent hotel additions in 2023 and 2024, the group now expects to deliver adjusted Ebitda in excess of €232m for the year, circa 4% growth year-on-year. Group revpar is expected to be circa 3.5% ahead of last year for November/December, with strong performances in Dublin and the UK. For the full year, group revpar is expected to be 1% ahead of 2023. The group estimates that the recently announced changes in UK national insurance, the increased minimum wage rates in Ireland and the increased living wage rates in the UK will increase hotel payroll by circa 5% in 2025 on a like for like basis. The group continues to respond proactively to cost pressures and is confident it will cover these additional costs with the benefit of a €2m reduction in contracted energy pricing, the ongoing roll out of further efficiency and innovation initiatives and through revpar growth in our markets. In 2025, the group will also benefit from the full year impact of hotels opened in 2024 and the addition of Radisson Blu Hotel Dublin Airport (subject to approval).” Dalata chief executive Dermot Crowley said: “We are on track to deliver another strong financial performance, headlined by another year of growth in both our revenue and adjusted Ebitda performance. Our focus on innovation over the last three years continues to deliver enhanced productivity and mitigate the impact of cost inflation on our margins. It is always challenging when external input costs are rising; however, I am delighted with how everyone at Dalata has responded to the challenge. We executed a number of strategic objectives during the year. We opened four new hotels in the UK this summer, we added to our growth pipeline with the acquisition of the Radisson Blu Hotel Dublin Airport and we exchanged an agreement for lease for a Clayton hotel to be developed in the heart of the City of London. Our growth is supported by our investment in our brands, which has enhanced our guests’ experience and driven a stronger market position. We also completed the refinancing of our debt facilities, securing a €600m debt package, including our inaugural private placement. This positions us strongly to capitalise on any opportunities that will deliver accretive value to the business and further strengthen our financial performance. We will continue to balance disciplined growth, capital efficiency and financial strength with returns to shareholders reflected by our dividend payments and two share buy-back programmes. The ability of Dublin Airport to continue to increase passenger numbers is crucial to support further growth across the Irish economy, particularly in the hospitality and tourism sectors which are key sources of employment for the island of Ireland. Looking forward, I am pleased that the cap will not apply in the summer of 2025, and we are hopeful that it will be removed fully in time. It is expected that passenger numbers at Dublin Airport will grow by 4% in 2025, with increased access from North America, which will be very positive for hotels across the whole of Ireland. I look forward to 2025 with optimism. I am very happy with the early trading performance of the four hotels we opened in 2024 and I look forward to Dalata benefitting from their full year impact next year. The addition of the Radisson Blu Hotel at Dublin Airport (subject to CCPC approval) is very exciting and will positively impact on 2025 performance. Our focus is on delivering our exciting 2030 Vision growth strategy to increase our footprint to 21,000 bedrooms.”
Shepherd Neame appoints two new NEDS: Brewer and retailer Shepherd Neame has appointed two new non-executive directors (NEDs). The operator of 291 pubs across Kent and the south east has appointed Marion Sears and Margaret (Meg) Lustman to its board, with effect from 1 April 2025. As previously reported, Hilary Riva and Kevin Georgel are both due to step down as NEDs, and will now do so on 31 March 2025. Sears will become senior independent director (SID) and chair of the remuneration committee. The former investment banker has over two decades of experience on both public and private boards as a NED SID and committee chair. Most recently, she was remuneration committee chair at Keywords Studios and remuneration and ESG committee chair at WH Smith. She is currently a NED at Dunelm Group and SID at Schroder Asian Total Return Investment Company. Lustman has held senior leadership roles in a range of leading multisite, omnichannel and international retail businesses. She was chief executive of Hobbs from 2014-2019 and managing director of Warehouse from 2009-2013, alongside other senior management roles at John Lewis and Aurora Fashions She is currently NED and remuneration committee chair of N Brown Group and remuneration committee chair at Glasgow Caledonian University. She was previously a NED at Ted Baker from 2021-2022 and chair of The Fashion & Textiles Children's Trust from 2014-2017. Shepherd Neame chairman Richard Oldfield said: “I am delighted that both Marion and Meg will be joining the board of Shepherd Neame. They each bring significant, and highly relevant, experience of the retail and wider consumer sectors, which will be of great benefit to the company. I look forward to working with them. On behalf of the board, I would like to thank Hilary and Kevin for their invaluable contribution, support and guidance during their respective tenures with the business.”
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