Loungers extends bank facilities and places new shares: Cafe bar brand Loungers has extended it bank facilities and is placing 9,250,000 new ordinary shares of 1p each. The company said this would provide additional liquidity headroom should closure be enforced for an extended period of time, together with growth capital “to enable it to emerge strongly from lock-down and recommence its roll-out at the appropriate time”. The company reported 99% of the company’s employees have been furloughed via the government’s Coronavirus Job Retention Scheme. A skeleton staff of business-critical employees has been retained to administer the company during the closure period and to prepare for the reopening of sites. Meanwhile, all capital expenditure and other non-discretionary spend has been paused and creditor payment terms for the duration of the site closure period have been re-negotiated. It is negotiating with landlords in respect of waiving March quarter rent payments. The base salaries/fees of the directors of the company have been reduced by 50% while the sites are closed (as a result of a 20% deduction and 30% deferral until sites reopen). As at 17 April 2020, the company had £4.1m of cash on its balance sheet, undrawn facilities of £3.0m and net debt of £35.4m. Its current lending banks, Santander and Bank of Ireland, have agreed to provide an incremental £15.0m revolving credit facility for an 18-month period. A total of £10.0m of the new facilities can be drawn immediately and a further £5.0m can be drawn on condition the company raises equity funding of at least that amount. Covenant tests at 12 July 2020 and 4 October 2020 have been waived and subsequent quarterly tests to 3 October 2021 have been reset.
Domino’s launches Partners Foundation to support colleagues, executives donate part of salary towards scheme: Domino’s Pizza Group has launched its Partners Foundation to provide financial support to colleagues in need. The scheme will support anyone within the UK and Ireland business who is experiencing personal hardship, both through the coronavirus outbreak and in the longer term. The scheme will initially be funded by a donation of £250,000 from Domino’s Pizza Group and will provide financial assistance to permanent colleagues of the group and its franchisees. The company said the fund can be “accessed by Domino’s employees in times of hardship or adversity, for instance bereavement, exceptional medical needs or household emergencies”. It will be overseen by a group of trustees made up of franchisees and Domino’s employees. Domino’s board members, including chief executive designate Dominic Paul and recently appointed chairman Matt Shattock, will donate 20% of their net salaries to the fund for the next three months. Non-executive director Usman Nabi has pledged a contribution of £100,000 on behalf of hedge fund Browning West. The group said many Domino’s Pizza Group colleagues have also expressed an interest in contributing to the fund via payroll. Paul said: “Since arriving at Domino’s, I’ve been hugely impressed with the hard work and dedication of our colleagues. From pizza chefs and delivery drivers to the production, warehouse and distribution teams – everyone plays an important part in the national effort by feeding our communities and delivering Domino’s £4m pizza giveaway for key workers. We’re proud to donate £250,000 to launch the Partners Foundation to help support our people through unexpected hardship during these challenging times and beyond.”
Nando’s reopens kitchens at seven sites for NHS workers: Nando’s has reopened seven of its kitchens to help feed NHS workers. The company has reopened four in London, two in Manchester and one in Dublin and workers will operate behind closed doors exclusively for NHS staff and local charities. Each restaurant will work under strict health and safety measures while maintaining social distancing, the company said. The restaurants will each aim to cook up to 250 meals a shift before delivering them. The business said it will provide up to 1,700 free meals each day for NHS staff, key workers at local hospitals and charities. Meals will be dropped off at hospitals every evening between 6pm and 9pm. Kitchen staff will also be cooking for charities linked with the company’s No Chuckin’ our Chicken initiative, which normally sees any spare food left at the end of the day given away. A spokeswoman said: “If this controlled reopening proves successful, then we hope to be able to continue to deliver food to our No Chuckin’ Our Chicken charities and NHS teams as the trial expands.” The company said there was no plans yet to offer delivery to the general public. It will be the first time the group has reopened kitchens since it shuttered its sites on 23 March following the government-mandated shutdown of restaurants, pubs and venues.
Greene King launches virtual pub: Brewer and retailer Greene King has launched a virtual pub offering weekly quizzes, bingo and entertainment acts to promote online socialising in the community. The virtual pub, The Lock Inn, will play host to a free quiz night every Wednesday at 6pm and “rock and roll bingo” every Friday at the same time. As well as entertainment, the pub is also looking to help fight isolation and loneliness by offering a “community corner” session every week from next month. Every Thursday between 5pm and 8pm – starting from 7 May – customers can have a chat – on any topic – with the company’s customer service representatives via Messenger on the Greene King Brewery Facebook page or by tweeting the Greene King Brewery Twitter account. All of The Lock Inn events and activities will be put on for free, although Greene King is offering customers the opportunity to make a donation to the company’s charity partner, Macmillan Cancer Support. Greene King chief executive Nick Mackenzie said: “With the UK under lock-down and social distancing rules restricting interaction, we have decided to launch a virtual pub to offer events that bring the community together.”
Chipotle reports soaring digital and delivery sales in first quarter, accepts record $25m fine over foodborne illness outbreaks: Chipotle has reported soaring digital and delivery sales driven by the coronavirus crisis helped offset the impact of shuttered dine-in facilities and the company said it had enough cash and liquidity to get through the next year. Overall like-for-like sales fell 16% in March with sites forced to shut their seating areas. While in-store ordering was 75% lower at the start of April, delivery orders rose 150% and mobile pick-up orders were 120% higher. For the first quarter, digital sales rose almost 81% to $371.8m and accounted for 26.3% of total sales, compared with 19.6% of sales in the fourth quarter. Total revenue for the first quarter rose to $1.4bn, compared with $1.3bn the year before. The company is looking to reopen its dine-in areas in some sites in the coming weeks but expects employees to still wear masks and gloves, offer hand sanitiser and likely have staff dedicated to cleaning tables. Chief executive Brian Niccol said the company could reopen stores “restaurant by restaurant” as more states start to lift restrictions on business operations enacted to help slow the spread of the virus. Separately, the US Department of Justice said Chipotle would pay a record $25m to resolve criminal charges related to the company’s involvement in foodborne illness outbreaks that sickened hundreds of people between 2015 and 2018. “These payments will unfortunately hurt our liquidity a bit, but we’re ready to put this old matter behind us,” said chief financial officer John Hartung. The company has withdrawn its forecast of delivering mid-single digit percentage growth in comparable restaurant sales this year.
MeatLiquor to reopen East Dulwich site for takeaway and delivery: MeatLiquor, the Scott Collins-led concept, is to reopen its East Dulwich site on Thursday (23 April) to offer a takeaway and delivery service. The site will be open for five days a week operating at reduced hours with food available for click-and-collect and takeaway as well as through UberEats. It will serve a reduced menu of MeatLiquor’s key dishes, including its Dead Hippie burger, plus beer and wine. The company, which operates eight sites across central London as well as in Croydon, Brighton, and Leeds, said it would consider opening a couple more sites for both delivery and click-and-collect, if the East Dulwich reopening proved successful.
McDonald’s begins conversations with franchisees as it prepares to reopen some US sites: McDonald’s has begun conversations with its franchisees as it prepares to start fully reopening some of its US sites. As some states, such as Georgia, prepare to lift restrictions, McDonald’s is stepping up efforts to keep employees and customers safe, reports Nation’s Restaurant News. McDonald’s US president Joe Erlinger said restaurants would follow local guidelines when reopening. A majority of US restaurants have remained open for drive-thru, takeaway and delivery services. McDonald’s recently launched employee temperature checks and began installing safety shields at the drive-thru and inside the cash register counter. Employees at almost 14,000 restaurants are now wearing masks. That amounts to sourcing and distributing roughly 900,000 non-surgical masks each day. Meanwhile, the company is joining nationwide efforts within the industry to feed front line workers by introducing a free daily “Thank You Meal”. Workers can obtain their free meal at the drive-thru or counter by showing their ID or being in uniform.
Heineken reports UK volume down by ‘mid-single digits’ in first quarter: Heineken has reported volumes in the UK were down “mid-single digits” in the first quarter and in March, due to record rainfall in February and the lock-down in late March. Its UK pub estate has been closed since the last week of March. Overall, consolidated beer volume was down 2.1% organically due to the impact of coronavirus. Heineken volume was up 5.0%. Heineken said it expected the impact of the coronavirus crisis to worsen in the second quarter of 2020. It also expects a hit in the second half of the year, as the impact on the economy is likely to endure even when lock-downs are lifted. The company has already secured additional financing on the debt capital market. It placed €1.4bn (£1.23bn) of five and ten-year notes in late March. Bonuses for senior managers, including the executive board and the executive team, will be cancelled in 2020. The company confirmed it will pay its planned final dividend for 2019. However, it will not provide an interim dividend after its interim results in August.
Shankly Hotel administrators to investigate how investors’ money was spent, no ‘fire sale’: Administrators of the Shankly Hotel, which was put into administration this month, said part of their role will be to investigate how investors’ money has been spent by its parent company – aparthotels developer and operator Signature Living – prior to their appointment. Joint administrator Mike Lennon, of Duff & Phelps, said: “We are aware a number of the bedroom investors have become concerned in recent months that monies due to them have not been paid, despite assurances from the company. The company is part of a wider group of companies and understanding how funds flow around the group will be central to our investigations. We have written to all known investors and will continue to communicate with them as the impact of our appointment on their position becomes clearer.” The joint administrators have also confirmed there will be no “fire sale” of the hotel. Lennon added: “The hotel itself is a quality venue and working with the lenders and investors we will be carefully considering our strategy to ensure we get the best outcome for those that are owed money. All options are under consideration to recover value for the creditors.” Henslow Trading, a lender to the group and that called in the administrators, has confirmed its support for the strategy.
Fever-Tree reports on-trade division facing ‘extremely challenging period’ but at-home sales ‘robust’: Fever-Tree said its on-trade division has faced an “extremely challenging period” but sales of its mixers to UK homes have been “robust” despite the coronavirus pandemic. The company said its off-trade business, which supplies shops and supermarkets, saw “strong” sales in the build-up to the lock-down. Sales have continued in recent weeks “as at-home consumption has remained robust” in the face of the coronavirus outbreak. It said the group had a “solid start to the new financial year”, with sales in January and February in line with the board’s expectations. Co-founder and chief executive Tim Warrillow said: “While we will not be unaffected by the current situation, especially in the on-trade, Fever-Tree is well positioned to manage our way through this situation. Financially the group is very secure. We are debt-free, with a strong cash position.” The company said it has not furloughed any of its employees due to the pandemic. It comes as Fever-Tree reported revenue increased 10% to £260.5m for the year ending 31 December 2019, buoyed by strong growth in the US. Pre-tax profit fell 5% to £58.5m.