ETM Group reports Ebitda jumps 202.6% as turnover hits £27m: ETM Group, the 14-strong bar and restaurant company, has reported turnover grew 34.7% to £27m for the year ending 29 February 2018, driven by positive like-for-like growth, an increase in events and pre-booked sales and continued site expansion. Group Ebitda jumped 202.6% to £2.7m, compared with £0.9m the year before – underpinned by sales growth, gross margin improvements and a focus on direct costs. The company opened two new City of London sites in 2018 – Long Arm Pub & Brewery and Broadleaf, which the company said were trading successfully. In April, the business secured a £10m funding package with HSBC to secure its growth plans. ETM Group also opened Maple at Westfield London in the summer and further sites have been secured for 2019, including Redwood, the company’s fourth sports-led venue, at London Bridge. ETM Group said there was a strong pipeline of additional sites in place and, as previously stated, is committed to expand significantly over the next five years. The group’s sports-led venues, Greenwood, Broadleaf and Long Arm, supported with strong marketing and digital campaigns, experiencing significant sales uplift over major sporting events such as the Six Nations, Fifa World Cup, Super Bowl and Ryder Cup. A major refurbishment of The Botanist Sloane Square was undertaken to mark its tenth anniversary. Chief executive Ed Martin said: “This has been an incredible year for ETM. The industry is facing challenging trading conditions and considerable cost headwinds. Despite this, the group has clearly demonstrated there is consumer demand for experience-led venues that deliver on quality food, drink and sport. The funding from HSBC and landlord’s continued demand for ETM’s innovative venues means we have a strong site pipeline in place. We will continue to invest in our current portfolio and our infrastructure to ensure our offer remains relevant and differentiated.”
Luke Johnson increases Brighton Pier Group stake to 27% after exercising warrants: Sector investor Luke Johnson has raised his stake in Brighton Pier Group to 27% after exercising his warrants in the company at a cost of £1m. The company stated: “Brighton Pier Group announces it has issued 1,622,274 new ordinary shares in the company of par value £0.25 following the exercise of warrants over ordinary shares held by the company’s chairman, Luke Johnson. Johnson has exercised warrants to acquire 1,622,274 ordinary shares at a price of 60p per ordinary share, amounting to a cash value of about £1.0m. Johnson was appointed to the board of the company as chairman in June 2015 and agreed not to draw a salary in respect of his appointment. The company agreed at that time to issue warrants to subscribe for up to 1,622,274 ordinary shares at a price of 60p per ordinary share to Johnson. The warrants had an exercise date of no later than 30 June 2019. Johnson has now exercised the warrants in full and is now beneficially interested in 10,062,466 ordinary shares, representing about 27.0% of the company’s enlarged issued share capital.” Johnson, who acquired the grade II-listed pier in 2016 in an £18m deal, has raised his holding from 23.7%. Johnson previously revealed his intention to increase his shareholding in the company at its full-year results announcement, in September.
Meat59 secures Newton Abbot site for third venue: Torquay-based independent burger restaurant Meat59 has secured its third site, in Newton Abbot. Owners Vince Aggett and Jenna Heasman have acquired the premises of tapas-style restaurant Olive in Wolborough Street. The sale marks a new chapter for Olive’s owners, who will focus on their harbour-side restaurant in Paignton as well as larger pub opportunities for their portfolio in south Devon. Aggett and Heasman, who opened a site in Exeter last year, will retain many of the original features of the Newton Abbot premises, including wooden floors and beams, a vaulted ceiling and an open fireplace. The open-plan restaurant seats more than 70 diners, with a licence in place for more than 30 covers outside. Jon Clyne, director at agent Charles Darrow, which completed the deal, said: “Vince and Jenna have been looking for a suitable site in Newton Abbot for some time so we were delighted to agree terms with them. They are planning to open imminently, establishing themselves in the run up to Christmas before undergoing a refurbishment in the new year.”
Domino’s Pizza under pressure to strengthen board: Domino’s Pizza is under pressure to strengthen its board as shareholders push for a heavyweight non-executive director to challenge its chairman and chief executive more effectively, The Sunday Times has reported. It said: “Some of the top 20 investors are understood to be lobbying for a new senior independent director to replace Helen Keays, an ex-GE Capital and Vodafone executive, who has served on the board for seven years. Keays is the only woman on the pizza chain’s nine-strong board. A government review has urged FTSE 350 companies to ensure a third of its board seats are filled by women by 2020. Stephen Hemsley, the chairman, has been with Domino’s for 20 years. Some shareholders are understood to believe the board lacks independence and needs to improve its governance. Domino’s, run by David Wild, has had a tumultuous time of late. Four finance directors have resigned in the past four years — most recently Rachel Osborne, who left to join department store group Debenhams in August.”
No1 Lounges doubles up at Birmingham airport for tenth UK site: No1 Lounges, which operates pay-on-entry lounges at airports across the UK, has opened a second site at Birmingham airport – and tenth in total. The latest lounge, which has opened under the company’s Clubrooms brand, complements the No1 Lounge that launched at the airport in 2012. Designed in the style of a modern members’ club, Clubrooms offers full table service, a la carte dining, wine, classic cocktails and views of the runway. No1 Lounges also has sites at Heathrow, Gatwick and Edinburgh airports and has hosted more than one million passengers in its UK lounges this year. Founder and chief executive Phil Cameron said: “We are delighted to be opening our second lounge at Birmingham airport. Our existing lounge has proved extremely popular so it was a natural step for us to open a second lounge, offering greater choice and an even more refined and memorable experience to our guests. This opening is part of a major expansion programme for No1, bringing more lounge choices and availability to airports across the UK and beyond.” Richard Gill, acting commercial director at Birmingham airport, added: “We have a successful and long-standing relationship with No1 Lounges and we’re delighted to announce the addition of Clubrooms to our offer.”
Hickory’s opens ninth site: American-style smokehouse and barbecue brand Hickory’s, which is backed by Piper, has opened its ninth site. The restaurant is in the Cheshire village of Gresty Green, between Nantwich and Crewe. The former Cheshire Cheese pub has been refurbished to feature an open kitchen, chef’s bar, dining area and neighbourhood bar with veranda, fire pits and a garden. Founder Neil McDonnell opened the first Hickory’s in Chester in 2010. The company now operates sites in the West Midlands, north west England and North Wales, the majority of them in former pubs.
Yamagoya to open second London site, in Soho next month: Japanese ramen restaurant Yamagoya is to open its second London site, in Soho next month. Founder Masatoshi Ogata debuted the concept in the UK as a six-month residency at hot pot restaurant Shuang Shuang in 2016, before relocating to a permanent site in Waterloo. Now it will return to Soho on Saturday, 15 Decemberto take over Shuang Shuang’s restaurant in Shaftesbury Avenue while the hot pot restaurant relocates upstairs. The venue will offer dine-in and grab-and-go ramen alongside new dishes such as a vegan curry rice with fried vegetables and pickled greens and Yamagoya’s renowned raindrop cake. Drinks will feature beer, sake, freshly made matcha and soft drinks such as sparkling water spiked with yuzu. Ogata said: “Soho is the perfect spot for Yamagoya and I’m proud it has come such a long way from the humble start in Fukuoka to the heart of London.” Ogata founded Yamagoya, which means “mountain hut”, in Japan in 1969.
Itsu opens new outlet in Gatwick airport: Itsu, the healthy Asian food chain created by Pret A Manger co-founder Julian Metcalfe, has opened a site at Gatwick airport. The restaurant’s food is free from monosodium glutamate (MSG) and prepared fresh in-store every day, with no central factory. Helen Teschauer, food and beverage business development manager, Gatwick airport said: “This is a key restaurant opening for Gatwick and it’s exciting to be bringing such a popular UK brand to our South Terminal. Feedback suggests our 46 million annual passengers appreciate fresh, healthy food options being available at the airport while they await their flight, and Itsu meets this demand perfectly. It’s a unique restaurant that has gone from strength to strength in recent years and is now a firm staple of the high street, so we’re really delighted to welcome Itsu into its new home at Gatwick airport.”
Jamie Rollo – we expect Greene King’s first-half results to exceed expectations: Morgan Stanley leisure analyst Jamie Rollo has said he expects Greene King’s first-half results to exceed expectations. He said: “UK pub stocks are trading on rock-bottom price-to-earnings multiples and price-to-book ratio valuations, while operating metrics are stable if not improving. The factors behind these low valuations are well documented – leverage, weak demand, oversupply, cost inflation, UK focus – but what is perhaps less obvious is the resilient operating performance reported by the three traditional listed managed pub companies – Mitchells & Butlers (M&B), Marston’s and Greene King. The first two recently reported solid full-year results, meeting market expectations, reporting encouraging recent trading, and M&B actually delivered margin and profit growth in the second half (we increase M&B FY19e Ebit by 1% and raise our price target from 250p to 280p). Industry like-for-like sales data has stopped deteriorating, and is running up 0.5% to 1.0%, and the companies’ intense focus on cost is holding Ebitda flattish, helping companies de-lever. After many years of underperformance, these pub companies’ share prices have started to outperform the market, although admittedly mainly because of stock market weakness rather than pubco share price strength. With all this in mind we are positive on Greene King ahead of this week’s first half. We think it will beat expectations and point to solid recent trading and investors are being rewarded with a 7% dividend yield, which we see as secure given our detailed work on the flexibility in its debt structure.”
Wright & Bell launches Lino for third City of London site: Restaurant and bar company Wright & Bell, which is backed by the Imbiba Partnership, has opened its third site in the City of London. The company has launched Lino in a former linoleum and carpet warehouse in the Square Mile. The space takes inspiration from minimalist Finnish design and features shades of peach, salmon pink and rustic green with brass fixtures. The centrepiece is a clover-shaped, tulipwood bar lined with shelves of craft spirits and jars of house ferments that can be mixed into cocktails. The kitchen uses low-waste ingredients across its all-day menu, which includes wing rib of beef, and oxtail and potato tart. Managing director Sarah Clark said: “Lino has been designed with its guests and team in mind, taking a new, considered approach to drinking and dining in the City.” Wright & Bell also operates Kitty Hawk and The Back Room Wine Bar, both in Moorgate.
BrewDog opens Perth site: Scottish brewer and retailer BrewDog has opened a site in Perth, Scotland. The company has opened the venue in George Street having previously agreed a deal through Shepherd Chartered Surveyors. BrewDog has signed a 20-year lease at £20,000 per annum for the 1,300 square foot premises across ground floor and basement levels of a four-storey building on the corner of a terraced row. The venue offer 14 taps of craft beer from BrewDog and guest breweries around the world and features a new-style deli fridge for takeaway purchases. The bar also serves a range of spirits and wine as well as coffee alongside the staple BrewDog menu of pizza, burgers and wings.
Rita’s team launches deli concept at Coal Drops Yard: Missy Flynn and Gabriel Pryce, who operated Rita’s in Hackney for four years and currently run the dining room at Redchurch Brewery in Cambridge Heath, have launched a deli concept at the Coal Drops Yard development in King’s Cross. Bodega Rita’s sandwich menu includes The Highway Dan (hot bean and devilled egg salad with celery and watercress) and Tingler Tower (chilli-oil chicken with cucumber and pepper slaw). From Thursday to Saturday, the menu expands to cover small dishes and snacks alongside a short drinks menu, Hot Dinners reports. Customers can also buy spice blends, sauces and ingredients. Bodega Rita’s is part of a second phase of openings at Coal Drops Yard, which will include a second site for Hackney-based Morty and Bob’s. In total, the Heatherwick Studio-designed destination will offer more than 50 stores, cafes and restaurants.
Tim Hortons makes Midlands debut: Canadian cafe and bake shop Tim Hortons has made its Midlands debut, in Birmingham. SK Group, which is leading the UK roll-out of the brand, has opened the venue on the corner of New Street and Lower Temple Street. Tim Hortons opened its first UK site in June 2017 in Glasgow and there are now 18 restaurants across the country. It has been a busy month for the brand, which submitted plans for a drive-thru in Coleraine as part of its Northern Ireland expansion plans and its first franchisees in the UK and Ireland – Graeme and Lisa Tobias – who will open a drive-thru in Stenhousemuir, Scotland. Professional ice hockey player Tim Horton founded the brand in 1964 to create a space where “everyone feels at home”.
Salisbury Pubs again wins double gold in FreeFrom awards: Chilterns-based Salisbury Pubs has again been awarded a double gold in the FreeFrom Eating Out Awards. The company’s pubs – The Alford Arms in Frithsden and the Royal Oak in Marlow – were both awarded the gold award for pubs and pub restaurants that offer a wide and varied menu for gluten and allergen-intolerant customers. Both pubs have entered four times in the five years since the event was launched and have picked up gold awards each time. Co-owner Becky Salisbury told Propel: “Catering for guests with allergens has become an increasingly important part of our business, so it is especially rewarding all the hard work from the Salisbury Pubs team has been recognised for the fourth year running. We are immensely proud of the effort and discipline that goes into producing delicious, free-from food on a daily basis in a safe and reassuring environment.”
Bermondsey Pub Company reopens Marylebone pub the Sir John Balcombe: Bermondsey Pub Company, the Ei Group managed operation, has reopened the Sir John Balcombe pub in Marylebone following a substantial refurbishment. The pub in Balcombe Street has been opened up, while the revamped kitchen offers a modern all-day pub menu with dishes such as half a beer-brined chicken with sweet potato fries. The new look includes exposed brick, vintage artwork, hanging pendant lights, banquette seating and comfortable chairs. The ground floor houses a central wood-panelled bar, while there is a smaller speakeasy-style bar downstairs that can be booked for private functions.
Carlauren Group adds Morecambe site to hotel portfolio: Property investment company Carlauren Group has added to its hotel portfolio by acquiring a site in Morecambe, Lancashire. Yeovil-headquartered Carlauren Group has bought The Headway Hotel for an undisclosed amount from Stephen Norfolk through agents Christie & Co. The four-storey seafront hotel comprises 54 en-suite bedrooms, a bar, lounge, restaurant and two large function rooms. Carlauren Group plans to renovate the site into a boutique resort offering accommodation and facilities to its network of private members. Chairman and chief executive Sean Murray said: “We are excited to have secured a resort location in the historic holiday town of Morecambe. We believe our combination of luxury accommodation as well as fine dining open to all, will bring a unique and valuable proposition to Morecambe.” In August, Carlauren Group bought Abbot Hall Hotel in Cumbria and Lindors Country House Hotel in Gloucestershire from Christian Guild Hotels from a combined guide price of more than £2.9m.
Pasta Remoli opens third site, in Ealing: London-based casual dining concept Pasta Remoli has opened its third site, in Ealing. Founder Simone Remoli has opened the site at Berkeley’s Dickens Yard development. The venue has space for 80 covers inside, 12 outside, and takeaway and delivery services. The Pasta Remoli concept sees diners choose their pasta and sauce before adding cheese. Remoli said: “Dickens Yard is such an exciting new location for us, with many shops and restaurants. We’re expanding into west London and I cannot wait to create a new family of regular customers there.” Pasta Remoli’s other sites are in Finsbury Park and Westfield Stratford. Last month, Remoli said the company was gearing up for “strong but gradual” growth.
Douglas Jack – Fuller’s making ‘right long-term decisions’: Peel Hunt leisure analyst Douglas Jack has said London brewer and retailer Fuller’s is “making the right long-term decisions”. Issuing an “Add” note on the shares with a target price of 1,150p, Jack said: “Managed like-for-like sales rose 4.1% in the first half supported by good weather (90% of the managed estate offers outside drinking). Like-for-like drinks sales rose 5.5% (weighted towards premium products – gin up 41%; soft drinks up 8%; low/no-alcohol sales up 56%), food like-for-like sales increased 1.6%, with healthy/vegan food proving popular; and accommodation like-for-like sales rose 1.8%. Managed Ebit margins fell 120 basis points due to rising labour costs and a front-loaded investment programme, offsetting strong like-for-like sales, a slight easing in food price inflation, business rates increases slowing to £1m in 2019E versus £2m in 2018, and utilities costs now being flat. Nine major refurbishment schemes took place in the first half resulting in 92 closure weeks, compared with 29 in the first half of 2018. We believe this closure time took £0.9m off first-half profits, accounting for more than half of the 120 basis points drop in margins. Tenanted like-for-like profits rose 4% against a comparable of 3%. The estate is benefiting from its market positioning (70% of outlets being wet-led pubs) and the process of investing and converting pubs to turnover-based franchise agreements (13 in 2018; ten in first-half 2019E; at least five in second half 2019E). We have always believed tenanted pubs should maximise purchasing efficiency on everything utilising the company’s centralised, commercial buying power. Fuller’s is absolutely right, in our view, to grow its number of franchised agreements and sign up 40 tenants to use its preferred food suppliers, saving tenants an average of circa 10% on their food basket. Tenanted like-for-like profits have moved from +4% in the first half (26 weeks) to +2% after 33 weeks. We believe this was due to extra refurbishment work, with the estate being on track to achieve 3% like-for-like profit growth over the full year. Brewing volumes were up 0.2% in the first half, with revenue up 7% and operating profit up 9%. Sales growth was driven by Nectar and a strong performance from premium brands. The Dark Star operation is now fully integrated, a new canning line has been installed at Cornish Orchards, and a new canning line will soon be installed at the Dark Star brewery in Sussex. 2019E is a year of strong expansion and refurbishment. Ten of 12 new managed pub additions and 92 of circa 102 closure weeks occurred in the first half. Our forecasts assume managed like-for-like sales rise 2% and margins fall and assume no extra sites are added during the second half. We believe the company is making the right long-term decisions.”
Former Wabi team to bring Japanese cuisine back to Horsham with a ‘South African twist’: The team behind Japanese restaurant Wabi, which closed in Horsham earlier this year, has submitted plans to launch a new concept in the West Sussex town. Horsham has been without a Japanese restaurant since Wabi was replaced by Brewhouse & Kitchen, the UK’s largest brewpub group, earlier this year. Now a team led by former Wabi staff and management plans to launch Minami-Za – a “Japanese restaurant with a South African twist” – at a former charity shop in East Street, the West Sussex County Times reports. The viability statement says: “When Wabi had to close in early 2018 due to the freehold being sold to a pub company, Horsham lost a popular Japanese restaurant that is missed by many of its loyal customers. Minami-Za will be a contemporary Japanese dining establishment and deli counter which, in addition to the restaurant on the ground floor, would offer regulated entertainment in the basement as a function room/music lounge for events and performances.”