Restaurant Group boss – ‘we’re prepared to sacrifice like-for-likes to grow bottom line’: The Restaurant Group chief executive Danny Breithaupt has told Propel the company is prepared to sacrifice like-for-like sales growth in order to increase its bottom line. The company reported on Wednesday (9 March) a 7.9% turnover increase in 2015 as it passed 500 sites for the first time but has seen like-for-like sales fall 1.5% in the first ten weeks of 2016. Meanwhile, analysts warned the company could now become the subject of private equity bids – its shares fell 22.7% to 420p. However, Breithaupt said he was willing to “give a bit back” on like-for-like sales if it meant the company continued to profit overall. He said: “For example, where we have an existing Frankie & Benny’s and we want to put a Chiquito and a Coast to Coast there, the like-for-likes are going to be impacted but it’s good for the overall growth of the group. Given our results in 2015, it was always going to be difficult to get off to a good start this year. I’d rather have total profits grow and give a bit back on the like-for-likes because that’s the right thing to do because it’s important to grow space.” The Restaurant Group expects to open a similar number of sites this year as it did in 2015 – 44. Breithaupt said he expected the figure to break down as 12-15 Frankie & Benny’s, ten Chiquito and Coast to Coast sites, and six pub restaurants with the remainder concessions. He added: “The leisure business is our key driver. Between those three brands, we’re looking at 35 sites. We are continuing to move away from being a single brand group (with Frankie & Benny’s) to a more balanced portfolio. Both Coast to Coast and Chiquito are seeing some real momentum. Coast to Coast is doing extremely well at the moment. We’ve got some interesting stuff going on this year – the new menu is doing very well. The other thing is we are creating jobs. We created 1,500 jobs last year and another 1,500 this year – mostly full-time. For our industry that’s a real positive. For me, it’s a positive the group is continuing to expand and we can create that level of employment. We are extremely proud of our results, which are the best the group has produced. We have got off to a difficult start this year but we are not alone in that – and there are 42 weeks still to go.” (See Company News for Peel Hunt broker’s note on The Restaurant Group)


Nando’s to explore food waste-powered restaurants in UK: Nando’s is exploring the possibility of food waste-powered restaurants in a bid to take energy management in its UK sites “to the next level”. Nando’s UK energy, waste and water manager Julie Allen told the group was discussing the purchase of green gas credits, which would see food waste sent to an anaerobic digestion plant to be turned into methane. The gas would then be pumped into the national grid or used to generate electricity. Allen revealed Nando’s is in discussions with a German company to give it the ability to store liquid food waste in tanks. She said: “It would be beneficial if we could power a percentage of our restaurants with food waste.” Allen said Nando’s had already brought in energy-saving initiatives, including 85% use of LED lighting in new-builds and extractor fans that only operate while chefs are cooking which, she said, had produced energy savings of about 37% compared with conventional fans. Tasked with monitoring and reducing energy consumption across Nando’s 360 UK restaurants – all of which have been fitted with monitors – Allen has also applied staff initiatives, with each site’s energy consumption compared with the same period a year ago and staff encouraged to improve performance. Allen said: “We’re using league tables for each restaurant to try to drive competition.”

Supper app to launch Seedrs crowdfunding campaign: Food delivery app Supper, which brings healthy and home-cooked meals to consumers in south west London and Wokingham, Berkshire, is to embark on a Seedrs crowdfunding campaign to help the business progress. The app is hoping to raise £400,000 by 13 May to use specifically for marketing and advertising purposes. It will also use part of the investment to bring in new members of the team, including customer service managers and a marketing expert. Founder of Supper Duncan Scott said: “We are very excited by the prospect of being able to really grow our platform now. We have had a great six months and in that time proved that our concept works and is scalable so now is the time to concentrate on growth, both in our existing geographies and finding new areas to introduce.”

Shake Shack stock plunges despite sales growth: Shake Shack told investors this week it expects sales to slow in 2016 while labour costs rise because of the company’s decision to increase pay for its workers this year. Despite strong like-for-like sales in 2015, along with lower food and labour costs, the company’s stock plunged more than 11% following the announcement. Shake Shack stock is currently trading below $38 a share, well off the chain’s all-time high of $96.75 reached in May last year. Shake Shack chief executive Randy Garutti said like-for-like sales would rise 2.5% to 3% for the full year, a significant slowdown from the 13.3% in 2015, including 11% in the fourth quarter ended 30 December. The company said the strong traffic experienced in 2015 would be difficult to sustain this year. “We do expect traffic to continue to be positive,” Shake Shack chief financial officer Jeff Uttz said. “But we don’t think current numbers are sustainable for the long term.” Shake Shack operates 84 sites and said it expected to add a number of new markets in the US this year, as part of a more flexible development strategy. Garutti said: “Our real estate opportunities are stronger than ever. We remain confident in our ability to execute on our growth plans.”



M&B rolls out contactless payments and Apple Pay across its estate, launches Toby loyalty app: Mitchells & Butlers has launched contactless payments and Apple Pay across its estate as part of the company’s ongoing investment in digital technology. The roll-out of contactless payments has now been completed across its 1,700 sites and Mitchells & Butlers said it would continue to innovate its digital platforms and utilise technology to enhance “the guest experience”. Other innovations include the launch of the Toby Carvery loyalty app, improving online booking functionality, and driving Dining Out gift card sales online through a variety of platforms and partnerships. Chris Hopkins, Mitchells & Butlers commercial and marketing director, said: “Digital technology continues to grow at pace and we continue to look for new opportunities to integrate these technologies into our business to help us enhance our offers, support our brands and ultimately deliver a better service to our guests.”

Hotel Chocolat to raise £50m with AIM float: Hotel Chocolat has unveiled plans to float on AIM as it seeks to raise £50m to fuel further expansion. The business, which was founded in 1993 by Angus Thirlwell and Peter Harris, has 84 stores across the UK and since 2013 has operated the Anglo-West Indian-themed Roast & Conch restaurant in Boar Lane, Leeds. Hotel Chocolat will use the proceeds, raised from the issue of new shares and the sale of existing shares by certain shareholders, to invest in increasing its UK manufacturing capacity and to open new stores. Co-founder and chief executive Angus Thirlwell said: “Hotel Chocolat is built on our core values of authenticity, originality and ethical trading. We are very excited at the prospect of listing as it is the next logical step in our growth plans and will enable us to accelerate the many initiatives that we have in place, in particular additional investment in our British chocolate manufacturing, in new stores and in our digital offering.”

Antic acquires JD Wetherspoon pub in South Norwood: Antic, the Downing-backed London pub operator led by Antony Thomas, has acquired a JD Wetherspoon pub in South Norwood. JD Wetherspoon said The William Stanley was being sold and the High Street pub would close on Sunday, 20 March. It will be taken over by Antic, which operates more than 35 sites across the capital, reports the Croydon Guardian. A JD Wetherspoon spokesman said it had been a “commercial decision” to sell the pub, but would not provide further details. He added The William Stanley’s 40-odd staff would all be offered jobs in other JD Wetherspoon pubs. Last September, Thomas said Antic was lining up a site in South Norwood. He added at the time: “It is an existing pub so I can’t say anything more until it is announced but we should announce within a couple of months.”

Star Pubs & Bars to extend retail skills workshops for licensees and staff: Star Pubs & Bars is to invest in a further series of free retail skills workshops for its licensees and their key staff in 2016. This follows the successful launch in 2015. About 50% of its pubs will have benefited from attending the workshops by the end of the year. As well as helping licensees improve standards and sales in their pubs, the workshops are intended to meet multiple operators’ requirement for staff training and development. In a new move for the leased sector, multiple operators who have at least one pub with Star will be invited to include senior staff across all their pubs on the Star workshops. Four workshops will focus on social media, merchandising and retail standards, customer service and drinks quality. Star is taking a different approach to course programming in 2016 with course topics, times and locations based on demand from its licensees. 99% of attendees of the 2015 workshops said they would recommend the workshops to other licensees. All materials have been created by Star Pubs & Bars to ensure their relevance to leased pub operators. The workshops are delivered by ABV using experienced trainers selected by Star, all of whom have also run their own pubs and restaurants. Lawson Mountstevens, managing director of Star Pubs & Bars, said: “We know from talking to licensees that getting good quality staff training is a major issue, particularly for multiple operators wanting to provide consistency. Staff increasingly expect employers to invest in their development not just pay them a wage. We hope that as well as helping our licensees deliver outstanding service, this initiative will also play a part in helping them recruit and retain great people.”

Deep Blue Restaurants reports turnover increase but pre-tax loss following investment exit, secures additional funds for expansion: Deep Blue Restaurants, which operates 16 fish and chip restaurants, has reported an increase in turnover but made a pre-tax loss following the exit of the Rapid Realisation Fund investment. The company saw turnover increase 7.1% to £5,464,434 for the year ended 29 September 2015, compared with £5,101,423 the year before, according to accounts filed with Companies House. Like-for-like sales grew by 11.8%. However, it made a pre-tax loss of £453,536, compared with a profit of £851,337 the previous year. This was due to Rapid Realisation Fund reducing its loan from £1.5m to zero and a £95,894 loss on the disposal of its store in Crawley, West Sussex. The company stated: “Our events business continued to operate successfully at main sporting and leisure events including The Oval, Twickenham and various music events. We introduced a delivery service in October 2014 and while we experienced a material increase in the average revenue of those stores offering the delivery service we will be focusing on improving the efficiency of the service before it is rolled out to other stores. In November 2015, the company secured additional investment, which will allow for a renewed phase of expansion in 2016 and beyond. The company will continue to pursue a policy of acquiring existing businesses and improving operating profit through a combination of operational efficiencies and economies of scale. The company will also consider new sites in desirable locations. In February 2016, the company agreed a new five-year contract with The Kia Oval to operate two mobile units between 2016 and 2020. The contract has an approximate value of £1.4m and provides excellent brand visibility to the circa 22,000 capacity crowds that enjoy The Kia Oval in the spring and summer months. The company is in the process of developing an online ordering system, which will allow customers to order food online for collection and/or delivery. The directors believe that there is significant opportunity in offering such a service if associated costs can be controlled. The new system is expected to be fully operational by April 2016.”



Humble Grape to open second site: Humble Grape, the wine bar and shop from James Dawson, is to open a second site in May. Following the success of the Battersea opening last year, Humble Grape is set to bring its concept to a 3,600 square foot space on St Bride’s Passage, just off Fleet Street. The site, formerly The Press House Wine Bar, once a famous drinking den for journalists, is tucked away down a cobbled street and hidden in the vaults of St Bride’s Church. This will be a 200-seat wine bar, shop, events space, private dining room and wine-cellar. Humble Grape directly imports handcrafted wine from small, sustainable, independent vineyards worldwide, avoiding the industry-standard markups from agents, importers or distributors. Dawson said: “I started Humble Grape in 2009 with a handful of wines that I’d discovered on my travels. I ran wine tastings for my friends and family and delivered cases on the back of my motorbike. Now we import over 200 wines, and have a loyal following. Many of my customers invested in our crowdfunding raise on Seedrs enabling me to launch the first Humble Grape wine bar and shop in Battersea, the mission being to make great quality wines accessible for all. The bar was so well received, we’re now in the position to bring the concept to central London.”



Fine Thai dining group Patara to open sixth London restaurant: Fine Thai dining group Patara is planning to open its sixth London restaurant – in High Street, Hampstead. The company has filed planning and licensing documents as it seeks to move into a site formerly occupied by French restaurant Aubaine, reports the New Camden Journal. Patara Restaurant Group opened its fifth London venue in Berners Street in November, with other sites in Soho, Oxford Circus, Knightsbridge and South Kensington. It also operates casual dining restaurant Suda in Covent Garden and a further five worldwide in Singapore, Vienna, Geneva, Beijing and Bangkok.

Yoobi to open second site in Oxford Circus in May: Yoobi, London’s first temakeria, will open its second site in Oxford Circus in May. The concept, which was founded in 2012 by Nicolas Steiner and Carolina Rodrigues, draws inspiration from Japanese traditions and the flavours of Brazil. Significantly larger than its Lexington Street counterpart, Yoobi Oxford Circus will have 64 covers and boast its own unique design; simple in style, yet with a strong focus on colourful graphics and the vibrancy of Brazil. Although still a fast, casual dining restaurant at heart, Yoobi Oxford Circus will also boast table service and outside seating. A long terrazzo marble sushi counter will be the focal point of the room that will also serve as dining space under a large interior canopy. The focus of Yoobi’s menu lies with temaki (Japanese hand rolls) that come wrapped in a crisp nori (seaweed) cone and are typically designed to be eaten by hand. The Oxford Circus site will introduce a selection of new Brazilian-influenced dishes, including seared pincaña temaki (Brazil’s most popular cut of beef) with a spicy teriyaki sauce. Yoobi has also created London’s first “Sakeria”, a unique range of Brazilian-Japanese fusion cocktails made with an array of Japanese sakes and fresh Brazilian flavours.

Smashburger plans to open Brighton venue, second in UK: Better burger brand Smashburger is planning to open a venue in Brighton, its second in the UK. A planning application has been submitted to put in a new shopfront on a unit in North Street, currently occupied by Mucho Burrito, reports Brighton & Hove City News. Smashburger, which has 335 restaurants in 35 US states and seven countries, was founded by former McDonald’s executive Tom Ryan. It signed a partnership with AL Ventures, part of the MSG Group, last year to launch in the UK. The company plans to open 35 restaurants in the UK in the next few years, with the first in Milton Keynes set to launch in May. Smashburger’s name derives from the “smashing” process used to cook its burgers.



Scandinavian-inspired bar and restaurant planned for Exeter’s new dining quarter confirmed as second site for Kupp: The Scandinavian-inspired bar and restaurant planned for Exeter’s new Queen Street dining quarter has been confirmed as the second site for London-based concept Kupp. The company, which launched in Paddington, has signed a contract with Aviva Investors to open the 6,000 square foot site at The Guildhall Shopping Centre just off Queen Street. The business, described as having the intention “to provide a high-quality, casual, all-day, food and drink offer within a relaxed and comfortable environment”, will be one of the largest units covering two floors and an outdoor seating area within Market Square. Inspired by Scandinavia, the menu is designed for grazing, sharing and social eating. The food is described as “simple”, “colourful” and “flavourful” and focuses on Scandinavian ingredients using cooking techniques such as in-house pickling, curing and smoking. Drinks include tank conditioned beer, wine, fresh juices and cocktails such as Kupp’s Aquavit Collins. Drawing on inspiration from the Swedish Fika style of enjoying a coffee break, which is more about socialising than drinking coffee, Kupp will feature its own unique espresso and filter coffee blend, created especially for the brand and complemented by freshly baked breads and pastries, which customers can enjoy in-store or as “grab-and-go” items. Steve Cox from Kupp said: “We are really excited about bringing Kupp to Exeter and being part of Queen Street. We considered many locations for our first casual dining venue outside the capital and we feel the city and the location is exactly the right choice.”



Wahaca to open 21st site – in Brighton in April: Mexican restaurant brand Wahaca has announced it will open its 21st venue – in Brighton on Friday, 15 April. The 130-cover venue will open in a grade II-listed building in the Colonnades, on the corner of North Street and New Road, which formerly housed Strada restaurant. Former MasterChef winner and Wahaca co-founder Thomasina Miers told The Argus: “We cannot wait to dish out proper tacos and tequila to the good people of Brighton. It’s a city with an amazing sense of culture, sustainable living and, importantly, knowing how to enjoy itself. My siblings both live here and have been pestering us about how Brighton needs a Wahaca – we look forward to getting stuck in.”

Harvey Nichols announces Grey Goose as cocktails partner for revamped Fifth Floor Bar: Harvey Nichols will partner with Grey Goose vodka for the cocktails menu at its refurbished Fifth Floor Bar, which will officially reopen on Sunday (13 March). The new drinks menu will feature “reinterpretations of classic cocktails” and include Grey Goose Le Fizz (vodka with St Germain elderflower liqueur, lime juice and soda water). Each cocktail will feature vodkas from Grey Goose brands – Original, La Poire, L’Orange, Le Citron, Cherry Noir, Le Melon and XV Spirit. A light bites menu will be available throughout the day. The bar’s new interior draws inspiration from “classic French luxury” and features leather, brass, marble and dark wood with blue leather banquettes and private booths. Grey Goose UK brand ambassador Myles Donneky, who collaborated with the Harvey Nichols mixology team to create the drinks menu, said: “We’re delighted to be working with Harvey Nichols to bring their customers in London a truly premium bar experience in-store.” The Grey Goose vodka brand is part of Bacardi’s portfolio.



Bill’s and Wildwood set to open in Bournemouth: Bill’s Restaurants, owned by Richard Caring, and Tasty brand Wildwood are set to open in the same building in Bournemouth, Dorset. The restaurant brands are lining up empty units in Bristol and West House, which is also home to Starbucks, in Richmond Hill. The former Richmond Classics unit will be home to Wildwood, which is expected to open this summer. Meanwhile, Bill’s has applied for permission to put tables and chairs outside the NatWest Bank, with the restaurant itself apparently set to open inside the former Lola Lo. The plans, for 22 tables behind green timber hoardings in the space in front of the bank, said the restaurant would be open until 11pm seven days a week, reports the Bournemouth Echo. No formal planning or licensing application for the former Lola Lo unit has yet been made. But the application for seating said people “would be able to appreciate the character and beauty of the historical building while enjoying their food”.



Edinburgh’s first arcade cafe set to open this summer: Edinburgh’s first arcade cafe is set to open this summer. Michael Cox is launching Konbo, which will offer a “vintage arcade experience within a cafe environment”, combining fine coffee with nostalgic gaming from the late 1980s to 1990s. He plans to open the business in the Tollcross area of the city, but declined to reveal an exact location because negotiations were still taking place with the landlord. Cox said a planning application would be submitted in the coming weeks. He told the Scotsman: “I’ve been sourcing games and planning this project for a couple of years now. I want to bring back the social element of gaming. These arcade machines appeal to people of all ages, and I think it’s important to have a space where they can be enjoyed together. In Scotland, arcades have almost died out. In Japan they survive because they are treated like social hubs with their own communities. This shows that the classic arcade is a viable alternative to modern online gaming – provided the venue and the atmosphere is right. We’ll have coffee and food available during the day, and the aim is to have beer and evening attractions as well.”

Restaurant Group agrees terms for Frankie & Benny’s and Chiquito venues at Barnstaple development: The Restaurant Group has agreed terms to open two venues – a Frankie & Benny’s and Tex-Mex brand Chiquito – at the proposed Anchorwood Bank development in Barnstaple. Plans have been lodged with North Devon Council to build restaurant space alongside housing at the site. Andrew Pegg, of Wessex Investors, which is behind the project, told the North Devon Journal: “We are delighted to have attracted two very strong family restaurant brands to Barnstaple and believe they will fit in very well with the rest of our site and complement the existing food offer in the town.”



Woody Grill owner fined over food hygiene offence: The owner of a Woody Grill branch has been fined £30,000 after customers complained they had fallen ill when they ate at a site in west London. The owner pleaded guilty in court to eight hygiene offences after a catalogue of filthy conditions were uncovered at one of its restaurants in Uxbridge Road, Shepherd’s Bush. The company was investigated by Hammersmith & Fulham Council’s environmental health team following complaints from people who had fallen ill after they had eaten at the restaurant. Following an inspection, officers found dirty food preparation surfaces, chopping boards and fridge door handles in the kitchen. Other serious failings included cooked food not protected from raw food, animal droppings found in the back store with no pest control measures in place and no safety paperwork. Owner Cengiz Erpolat, who owns six Woody Grill restaurants across London, was fined and also ordered to pay costs of £4,327.50 and a £120 victim surcharge at Hammersmith Magistrates’ Court.