M&B sites converted to Ego restaurants under joint venture seeing 80% sales uplift: Mitchells & Butlers (M&B) sites that have been converted to Ego venues under its joint venture with 3Sixty Restaurants, led by James Horler, are seeing an 80% uplift in sales on average, Propel has learned. Seven sites have opened since M&B formed the partnership in August last year when it bought sector investor Luke Johnson’s minority share in 3Sixty. The eighth venue since the joint venture – Manor Farm in Worcester – will launch next month. Work is currently under way to transform the former Stonehouse Pizza & Carvery to the Mediterranean-inspired restaurant and bar concept, taking it to 20 venues in total. Horler told Propel: “We are seeing a considerable sales uplift from the new M&B sites – 80% in fact. We’ve seen strong like-for-like performance this year and we’re running ahead of budget. For example, total sales in August were up 39% on last year. We’ve got 67 staff with more than five years’ service and 30 have been with us more than ten years. We’re also working on developing our offering further and we’ve got 241,000 Ego Club members.” Horler said following the Worcester opening the company would focus on the Christmas period before aiming to add another two sites in the first quarter of 2020. Horler spoke to Propel in the wake of Ego Restaurants lodging its accounts for the year ending 31 March 2019. In what Horler described as a “transactional” year due to the restructuring prior to completing the joint venture with M&B, turnover was up slightly to £19,529,336, compared with £19,458,251 the year before. Ebitda before one-off exceptional costs was £968,889, compared with £1,004,965 the previous year. Operating losses increased to £749,840, compared with £815 the year before, mainly because of a £697,228 loss on the disposal of a subsidiary company. Horler said: “Because of all the transactions, the accounts don’t really reflect how well we’re performing. When we file the accounts for the financial year March 2020 they will paint a much clearer picture. The outlook for the forthcoming period is very positive as the new sites improve their performance and contribute significant Ebitda and we continue to expand under our joint venture with M&B.”
Inception strengthens position as UK’s ‘leading experiential hospitality group’:Inception Group, which operates an eclectic collection of London bars and restaurants including Mr Fogg’s and Cahoots, reported a record year in 2018 that enabled it to strengthen its position as the “leading experiential hospitality group in the UK”. For the year to the end of 2018, the Charlie Gilkes and Duncan Stirling-led group reported site revenue from its seven core sites of £17.2m (2017: £17m), with site Ebitda at £4.7m (2017: £4.6m). Site Ebitda margin (excluding pre-opening losses) was 27.2% (2017: 27.4%). Including three sites opened in the second half of the year, total revenues stood at £19.1m, with site Ebitda margin at 24.4%. Propel understands the company has continued to trade well in the year to date with Christmas pre-bookings looking positive. It’s also thought the business remains on track to generate revenue of circa £25m in its current financial year. During the second half of 2018 the company opened three venues – Mr Fogg’s House of Botanicals in Fitzrovia in July; Mr Fogg’s Society of Exploration in Covent Garden in September; and Mrs Fogg’s in the City in October. The company’s total estate now comprises ten sites with a core seven venues across the Mr Fogg’s, Cahoots, Bunga Bunga, Barts and Maggie’s brands. Inception recently signed for a fourth site next to Cahoots in Soho, which will launch as a complementary concept this year. Gilkes told Propel: “The core estate is well established and continues to perform well, delivering revenue growth for a ninth year in a row. Each site in our core estate is highly profitable.” Regarding the new sites, Gilkes said: “Each venue achieved its first monthly profit within three months of opening. Together, these four venues will result in significant growth for the business as they trade through the 2019 Christmas period and contribute full-year revenues, profits and cash flow while they mature.” Propel revealed earlier this year the group, which secured banking facilities from OakNorth Bank in February 2018, had appointed advisory firm Tamweel Capital to help assess further funding options. Gilkes said: “We have a collection of highly recognisable brands and immersive formats with a proven ability to grow without compromising our distinctive individuality. In 2018 we’ve seen social media become ever-more prominent in experiential hospitality and capitalising on this will continue to be at the forefront of our strategy. Our brands have a strong social media presence with more than 750,000 followers across Instagram, Twitter and Facebook – an increase of more than 75% in the past 12 months. We continue to invest in our talent through training, group-wide events and our industry-leading development manager programme. We believe the challenges the casual dining sector faces present significant growth opportunities. We are in regular discussions with landlords and operators and will continue to prudently evaluate these opportunities.”
Industry experts launch UK’s first outsourced restaurant meal prep service: Craig Allen, co-founder of hospitality recruitment firm The Change Group, marketing and commercial business consultant Jane Holland, and chef James Sharman have launched an outsourced service that preps meals for busy restaurants. Boxed Off has been launched as a “solution to the UK’s chef shortage”, with financial backing from Black Pine Private Equity and JIA Group. The service allows restaurants to outsource all or some of their food preparation to free up kitchen time and stock and cut reliance on temporary labour. Boxed Off offers same-day deliveries to restaurants across the country from central kitchens in Leicester and London and provides all ingredients. Sharman, who has worked in kitchens for 13 years including with Tom Aikens and at Noma, said: “While the industry tries to make inroads to attract and retain more talent, we believe it’s time for businesses to consider new solutions and rethink the model of how a restaurant is run. Foodservice companies are a great option for large pub chains but are less appealing to standalone restaurants and small independent groups that want to offer a bespoke high-end standard of food. We hope our service will also reduce chefs’ working hours, improve rotas, and reduce reliance on costly and sometimes unreliable temporary staff.”
Time Out’s Spitalfields plans enter ‘last chance saloon’: Time Out Group chief executive Julio Bruno has told Propel the company’s plans to open a market in London’s Spitalfields are in the “last chance saloon”. The company has been working on plans to bring a market to Commercial Street since 2016. Having seen its previous application rejected, Time Out has been working with the landlord to overcome concerns relating to the design. It is also holding public exhibitions at the proposed site this week and inviting comments via an online survey. All this comes ahead of plans to resubmit the application in the final quarter of this year and Bruno said the company had done “everything it could” to get the application finally approved. Speaking following the company’s half-year results, Bruno said: “We are confident we have overcome all the issues raised and we still believe it’s the right area for a Time Out Market, which would bring something new to Spitalfields. However, if we are unsuccessful I think we’ll have to accept it’s not to be. We are opening in Waterloo and pushing on with that so we’ll definitely have a presence in our home city. It would be nice to have two but, if it’s not to be, we’ll concentrate on the other ten markets we have or are opening and continue to add to the pipeline.” With sites in Dubai, Porto and Prague lined up and five markets launched or in the process of opening in North America, Bruno said Time Out’s pipeline remained “strong”, with further opportunities in Europe and Asia being explored in particular. He added: “Everything we do is about content – whether through our media or our markets with the dishes chefs create. It’s then about harnessing that content in the best way possible to encourage people to go out and spent time with their friends. We have bartenders and floor managers on our books too and now see ourselves as a media and leisure brand.” Reflecting on the first half, Bruno said: “We are delighted with the progress we’ve made with our markets and are proud of what our teams have achieved. We look forward to continuing to grow our locations and working with more chefs to bring their dishes to consumers.”
DHP Family reports turnover jumps to £58m as ticket and events income soars:Live music venue operator DHP Family has reported turnover increased to £58,304,563 for the year ending 31 December 2018, compared with £31,653,117 the previous year. Ticket and events income soared to £40,853,279, compared with £17,822,341 the year before. Operating profit fell to £576,815 compared with £1,767,193 the previous year as a result of an impairment of £1,414,756 against fixed assets. Pre-tax profit was down to £468,548 compared with £1,655,199 the year before, according to accounts filed at Companies House. In their report accompanying the accounts, the directors stated: “Gross profit has increased 25%, a result of strong performance across the business departments. Net assets at the year end were £8,564,135 (2017: £8,729,735). Cash generated on operating activities has in part been set aside for refurbishments at Thekla, which is undergoing work. Other investments occurred in the year to Beta in Rock City, where the room was reconfigured to provide a better layout for customers and better sound for all. Cash at year-end decreased year-on-year due to ticket sales in advance being lower at the end of 2018 in comparison with 2017.” The number of employees increased to 376 from 369 the year before. DHP Family currently operates eight venues in London, Nottingham and Bristol as well as outdoor festivals, national tours and standalone shows across the UK.
McDonald’s to trial plant-based burger: McDonald’s is to trial a plant-based burger it has developed with vegan food producer Beyond Meat. The company will offer the PLT (plant, lettuce, tomato) from Monday (30 September) in 28 restaurants in Ontario, Canada. “McDonald’s has a proud legacy of fun, delicious and craveable food – and now we’re extending that to a test of a juicy, plant-based burger,” said Ann Wahlgren, vice-president of global menu strategy. “We have been working on our recipe and now we’re ready to hear feedback from our customers.”
Cubitt House reveals new financing arrangements as it reports turnover and Ebitda boost: London gastro-pub operator Cubitt House, whose sites include The Alfred Tennyson and Thomas Cubitt, has settled its bank loans in full and replaced them with group finance. The company, which opened its sixth site this week, revealed the new financing arrangements as it reported turnover increased 17.5% to £12,069,570 for the year ending 31 December 2018, compared with £10,266,776 for the previous year. Ebitda jumped 242% to £909,052, compared with £265,506 the year before. The company saw an operating profit of £93,517 compared with a loss of £435,010 the previous year, while pre-tax losses narrowed to £268,884 compared with £454,804 the year before. In their report accompanying the accounts, the directors stated: “Motcomb Street, where The Alfred Tennyson is, continues to undergo redevelopment associated with the Pantechnicon building, which continues to cause disruption to the area. Post completion of the development, we expect footfall to the area to improve and the pub to benefit. In 2019, the Investec bank loans were settled in full and replaced by group finance.” Earlier this week, Cubitt House opened The Beau Brummell in St James’s Market for its sixth site.
London’s first avocado restaurant opens debut overseas site: Avobar, London’s first avocado-themed restaurant, has opened its debut overseas outpost – in Hong Kong. The company, which opened its first permanent site in Covent Garden last year, has launched at K11 Musea, a culture and retail destination at Victoria Lakeside. The venue offers 60 seats in an “industrial decorative setting”, reports Retail & Leisure International. As well as avocado salad and the signature Avo Bun burger, which consists of two large avocados with vegetables in the middle, the site sells avocado-based lifestyle products. Avobar launched a pop-up in 2017 before moving to its permanent site in Henrietta Street last year.
SSP to open six F&B units at new Beijing Daxing International airport: SSP, the operator of food and beverage (F&B) brands in travel locations worldwide, has secured three contracts to open six units at the new Beijing Daxing International airport. SSP will be the key F&B operator at Beijing Daxing and introduce concepts such as Blue Frog Bar & Grill, one of the fastest-growing Western casual dining restaurants in China. The brand offers classic dishes with an emphasis on North American flavours, including steaks, burgers, sliders and ribs. Japanese restaurant chain Saboten will also make its debut at a mainland China airport, with two sites offering signature dishes such as special tonkatsu sauce and koshihikari rice. The other brands are wonton noodle specialist Chee Kei, Chinese snacks chain Taoyuan Village, and the Hungry Korean. Mark Angela, chief executive of SSP Asia Pacific, said: “The travel retail market in China continues to grow at a rapid pace and these latest launches will enable us to grow our presence and gain a stronger foothold in this burgeoning region.”
British patisserie concept Epic Pies to open debut bricks and mortar site, in London next month: British patisserie concept Epic Pies is to open its debut bricks and mortar site, in London on Monday, 14 October. The venue will launch in Carter Lane, near St Paul’s Cathedral, offering a “spin on British pies, tarts and pastries”. Epic Pies was founded in 2015 by mother and son Daniel and Roshnara Jobsz, who started making pies and pastries to sell at markets and festivals in the capital. The 55-cover shop will offer a rotating selection of five pies, all handmade and served with mash, steamed greens, and gravy or parsley liquor. Signature pies include the Ham-Hockey Puck (ham hock and leeks in a cider and mustard sauce) and the EastEnder (braised peppered steak). Savoury tarts are also a speciality such as the New Yorker (salt beef and Swiss cheese on rye pastry). Epic Pies also offers cronuts, croffles and desserts, alongside craft ale, wine, spirits and hot drinks. The venue will include original Victorian features, while a glass pastry studio will allow customers to see pastries being prepared.
Goodbody – solid fourth quarter concludes good year for M&B: Goodbody leisure analyst Paul Ruddy has said a solid fourth quarter has concluded a good year for Mitchells & Butlers. Following the company’s pre-close trading update for the 51 weeks to 21 September, Ruddy said: “Like-for-like growth in the most recent eight weeks was up 3.3%, an acceleration from the 2.8% reported in the ten weeks to 27 July. In the past eight weeks, food was up 2.1% and drink 4.0%, which is a good outcome given the weak Coffer Peach data in August. For the 51 weeks like-for-like growth was 3.6%, in line with the 3.6% reported for the first 43 weeks, and is slightly ahead of our forecasts. Total sales have increased 4% in the year to date, slightly ahead of our 3.7% forecast. Operating profit margins are expected to be at a similar level to last year, in line with our expectations (14.1%). The group has also announced an agreement has been reached on 2019 triennial valuations, which now show a deficit of £293m with an unchanged schedule of future contribution (circa £45m). The pension deficit will be fully funded at the end of 2023 as we would have expected. Overall this concludes a good year for Mitchells & Butlers, with the group achieving upgrades to earnings during the year despite the difficult cost and trading backdrop. It also continues to generate a significant cash flow for debt pay-down. Trading on 7.5 times EV/Ebitda, it trades in line with its historic valuation but at a substantial discount to the recent mergers and acquisitions transactions in the sector (Greene King 9.5 times and Ei Group 11.4 times Ebitda). M&B remains our top pick in the pub and restaurant sector.”
Naked Deli launches at Glasgow airport for first site outside north east heartland:Newcastle-based The Naked Deli has opened its first site outside north east England, at Glasgow airport. Founded by Kirstie Kimmins and cousins Chris and Ian Jones in 2014, Naked Deli has four stores in the north east area and the deal to open at Glasgow follows a successful 12 months’ trading at Newcastle airport. The site will offer the brand’s range of healthy grab-and-go options. Kimmins said: “Our mission is to bring our clean, healthy and nutritious food, drinks and treats to major cities across the UK.” Denise Gilmour, head of retail at Glasgow airport, said: “Naked Deli is a fantastic brand and I’m positive the company’s clean, healthy and nutritious ethos will be popular with passengers.” The Naked Deli secured £2.5m of backing from investment company Foresight Group in 2018 to fund expansion.
Mr Ji’s to open permanent site, in Soho in November: Taiwanese-inspired chicken concept Mr Ji’s has confirmed it will open a site in Soho in November. As revealed by Propel earlier this month, the street food-influenced concept founded by Samuel Haim will launch a grab-and-go format in Old Compton Street. The business previously operated a pop-up in Camden. The interiors will be inspired by Taipei, with lantern-style lighting and Taiwanese street art and graphics. Mr Ji’s focuses on crispy fried chicken and alcoholic Taiwanese tea. Using only 100% free-range chicken, the hero dish is the Big Ji – chicken breast brined and coated in gluten-free sweet potato flour, deep fried, then dusted with flavours. It also offers Mini Ji’s – bite-sized pieces of marinated thigh meat in house sauce – and a bao burger, while side dishes include hot and sour soup and sweet potato doughnuts dusted with ginger sugar. Hain said: “I met the real Mr Ji while hiking up Elephant Mountain in Taiwan. He was an enigmatic character who told us where to find the best fried chicken in Taipei. I’m looking forward to bringing my modern and sustainable take on Taiwanese fried chicken to Old Compton Street.” Shelley Sandzer acted for Mr Ji’s on the Soho site.
Draughts relocates Hackney site to add private dining room with ‘hidden features’: Board game cafe concept Draughts is relocating from its Hackney site to 41 Kingsland Road in Dalston, where it will expand its offering in the larger space to include a private dining room with “hidden features”. The grade II-listed, 3,000 square foot former pie and mash shop was more recently home to Shanghai Chinese restaurant. Customers will enter a bar with booths before venturing into the main area, which will be broken down into different rooms and sections with a library offering more than 1,000 games. For a more intimate experience, an office on the top floor has been converted into a retro-inspired private dining room with several hidden features – “perfect for a party or themed event such as a murder mystery dinner”. Able to accommodate more than 180 gamers, food will be run in partnership with Andy Jones, who provides the same service at Draughts’ debut site, in Waterloo. The drinks menu will include beer, cider, wine and themed cocktails. Toby Hamand and Nick Curci launched Draughts Waterloo in November 2014. Curci said: “This larger space in east London gives us the opportunity to create a bigger and better gaming, dining and drinking experience.”
Speciality coffee shop Kiss the Hippo opens second London site, in Fitzrovia:London-based speciality coffee shop Kiss the Hippo has begun expansion by opening a site in Fitzrovia. The company, which is led by Can Eren, launched its debut cafe and roastery in Richmond in June 2018. It has now opened a central London site in Margaret Street offering breakfast, brunch and lunch to eat in or take away alongside sustainably sourced coffee. Kiss the Hippo Fitzrovia’s menu includes vegan banana cake, mushrooms on sourdough toast, desserts and baked goods such as a cinnamon roll with white chocolate icing. Set across two floors, the venue offers a minimalist look with “exposed beech accents and Scandinavian-style furniture”. Kiss the Hippo is dedicated to supporting the people at every link of its coffee chain – from the “farmers who grow the coffee to the guests who enjoy the final cup”.
Bollington Brewing Co partners with Manchester students’ union: Cheshire-based Bollington Brewing Co has partnered with the students’ union at Manchester Metropolitan University. Under the partnership The Salutation, a Victorian-era pub run by the union, has reopened following a major refurbishment. The food and drinks offer has been overhauled including the addition of Bollington beer, a steak burger and homemade pork scratchings. Bollington Brewing Co managing director Lee Wainwright said: “We have a lot of loyal supporters who live and work around the university campus. This partnership allows us to keep them happy.” Paul Norman, of the students’ union, added: “The pub looks amazing and the refurb has truly brought our vision to life.” As well as its brewery, Bollington Brewing Co operates three pubs in Cheshire, in Macclesfield, Poynton and Bollington.
Multi-purpose space featuring food market and cinema opens in Catford: Cultural infrastructure developer Really Local Group has opened a multi-purpose space featuring a food market in Catford, south London. Catford Mews, a 14,000 square foot community hub, features a three-screen cinema, food market, cafe, bar, live entertainment venue and, eventually, co-working areas and exhibition spaces. The food market includes stalls from local traders, while the full-service bar offers local produce including its own Catford Mews beer from nearby Brockley Brewery. The cinema has 220 seats in total, while a stage with live performance equipment is available for local artists, groups and schools. Really Local Group founder Preston Benson said: “It is my aim to make Catford Mews the envy of south London.”
Ei Publican Partnerships sees more than 200 pubs in Good Beer Guide: Ei Group’s leased and tenanted division, Ei Publican Partnerships, has seen 216 of its venues appear in the Good Beer Guide 2019, published by the Campaign for Real Ale (CAMRA). In total, 4,500 of the “best real ale pubs in the UK” feature in the guide. Ei Publican Partnerships managing director Nick Light said: “We have worked hard to provide our publicans with an exceptional range of real ale and craft beer.”
Lugger says ‘passion can lead to outperformance’ in latest Teddy Talk: Victor Lugger, co-founder of Paris-based Italian restaurant brand Big Mamma, discusses how passion can help you outperform the market as part of Curtice Brothers’ “Teddy Talks” series. Talking to Mario C Bauer, AmRest brand ambassador and Curtice Brothers co-founder and WhiteSpace partner, Lugger also explains why the “guys who succeed are the ones who carry the big smiles when mistakes happen”. To see the video, click here. Big Mamma operates two restaurants in London – Gloria in Shoreditch and Circolo Popolare in Fitzrovia – and nine venues in total.
Spelzini launches Luigi’s: Jim Fisher has launched a new evening offer at Spelzini, his Italian cafe and all-day eatery in Shoreditch High Street. Inspired by his Italian heritage and Mediterranean dining culture, Luigi’s Bar focuses on spuntini, antipasti and tramezzini – small Piedmontese sandwiches – alongside Italian wine, cocktails and vermouth. Fisher said: “The inspiration for Luigi’s goes back to my great-grandfather Luigi, a fishmonger and grocer from Liguria who came to London and brought the eating culture of the coastal towns of northern Italy with him.”
Holiday Inn on M1 brought to market: A Holiday Inn at Junction 28 of the M1 has been put on the market through Christie & Co and JLL Hotels & Hospitality Group on the basis of a share sale. The hotel in Alfreton, Derbyshire, offers 163 bedrooms, 11 meeting rooms and a 220-capacity car park, while leisure facilities include a pool and spa. The property also has planning permission in place for an additional 54 bedrooms. The owner, Serani Hotels, acquired the property in 2017 and has undertaken a refurbishment, completing the rebrand to Holiday Inn earlier this year. Christie & Co director Alex Campbell said: “The Holiday Inn South Normanton has undergone large capital investment in recent months and the branding and system support has already seen a positive impact on business. The hotel provides a platform for a new owner to capitalise on the Holiday Inn branding and investment to drive revenues.”
BaxterStorey gains double Soil Association accreditation: Contract catering company BaxterStorey has been awarded two bronze standard accreditations by the Soil Association for its catering operations at the Guildhall School of Music & Drama and the Barbican Centre. The certification, a first for both venues, recognises the standard of BaxterStorey’s catering services provided at both venues. Following an audit, the BaxterStorey team was commended for using organic and free-range ingredients throughout its menus. BaxterStorey managing director Sarah Miller said: “We are proud of our teams, who ensure our customers receive the finest food and drink possible in a sustainable and considered manner.”
McCain enters delivery market: McCain Foodservice Solutions is to tap into the growing UK delivery and takeaway market by launching a new product next month. McCain research found more than four-fifths (82%) of consumers have experienced soggy, cold or poor-quality fries when ordering a delivery, while almost two-thirds (65%) said bad chips negatively affected their view of an operator. McCain said its SureCrisp fries remained crispy for up to 20 minutes, with the range consisting of eight products. McCain Foodservice Solutions product manager Megan Cornelius said: “It is well versed fries don’t fare well during delivery, often arriving soggy and cold. McCain SureCrisp has been designed to combat the negative perception.”