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Marston’s to take on SA Brain pub estate

Ralph Findlay, Chief Executive, Marston'sMarston’s has exchanged on a deal to take over the operation of Welsh brewer and retailer SA Brain’s 156-strong pub estate. The deal will see the Ralph Findlay (pictured)-led Marston’s operate 141 freehold pubs on a leasehold basis, with effect from February 2021, with rent chargeable from 1 April 2021. The majority of these will be on long lease agreements of 25 years. The outlet level Ebitda on a pre-covid basis is £14m and annual rent of £5.5m will be charged from April 2021.

In addition, Marston’s will operate the remaining 15 short-leasehold sites on a management contract basis for a period of two years. The circa 1,300 people currently employed in the pub business will transfer across to Marston’s and an initial incremental central overhead of up to £2m will be required to operate the additional pubs. The Brain’s pub business comprises a freehold estate of 86 managed and 55 tenanted pubs, together with a leasehold estate of 15 managed pubs and bars.

Marston’s currently operates 106 pubs in Wales. Marston’s, which was advised by Sapient Corporate Finance, said the agreement, which has the unanimous support of the Brains’ board and its lenders, was consistent with its “long-term strategy as a focused pub operator, post the recent disposal of its brewing assets, and strengthens the group’s representation in south and west Wales”. It said the Brains’ pub portfolio is “entirely complementary with the existing Marston’s estate comprising a mix of well invested, high-quality, destination food and wet-led community pubs, as well as pubs with an accommodation offer providing more than 200 bedrooms, in prime locations”.

Marston’s intends to continue to operate these pubs under the Brains’ brand and continue to offer Brains’ beer in these pubs. It is anticipated the transaction will be earnings accretive in the first-year post completion. In addition, Marston’s said it sees opportunities to further grow earnings in the medium term through conversion to franchise and additional investment opportunities in the estate. The transaction does not impact Marston’s financial strategy to reduce borrowings to below £1bn by financial year 2024.

Findlay said: “We have worked closely with the management team and the SA Brain family to collaborate on a mutually beneficial transaction that safeguards the future of Wales’ leading pub company, enabling these great pubs to have a stable and successful future, and securing 1,300 hospitality jobs in Wales. This transaction is entirely consistent with Marston’s long-term strategy as a focused pub operator and strengthens our representation in south and west Wales, while protecting the heritage and independence of an iconic Welsh business. These high-quality pubs are a great fit with our existing estate and will benefit from Marston’s scale and operational expertise to further unlock their excellent long-term potential. We look forward to the pub teams joining us and to welcoming guests and the communities which they serve, back into these pubs as the country emerges from the pandemic over the weeks and months ahead.”


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Sector trade bodies have joined forces to make a final pre-Christmas plea to the government for an urgent comprehensive pub support package in light of the escalating crisis. The British Beer & Pub Association and the British Institute of Innkeeping along with the Campaign for Real Ale, the Independent Family Brewers of Britain, UKHospitality and Pub is The Hub have urged Downing Street to ensure Britain’s pubs “can make it through the most challenging of winters”. The trade associations have written to chancellor Rishi Sunak setting out the package of financial measures needed now – namely significantly enhanced grants of at least £3,000, £6,000, £9,000 and £12,000 per month (depending on rateable value) for a minimum three-month period commencing from Friday, 1 January.

This would be more akin to the level of support seen in the first lockdown, they said. The trade associations said the average pub would expect to take £47,000 in December. Much of this would see them through January and February when trade is typically quieter.

With 85% closed or unviable now, and the likelihood of an extended period of full closure and tighter restrictive measures, the certainty provided by a proper financial support and economic bridge to the spring was critical for the survival of thousands of pubs, they said.

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Beer duty will top £337m this December, despite 85% of pubs being unable to open. The sum for December alone is more than the entire annual duty bill in 19 other European countries, according to analysis by campaign group, Long Live The Local. It said the research highlights the level of UK beer duty in comparison to most other countries in Europe. British beer drinkers pay more than 54p in duty on every pint while in Spain and Germany the beer duty rates amount to just 5p per pint, which means the UK pays 11 times more. Only Finland and Ireland pay higher rates. Last year in total UK drinkers paid £401m in beer duty during December alone, but projections from the British Beer & Pub Association (BBPA) estimated the impact of covid-19 will reduce sales by 16% for the same month this year. The Long Live The Local campaign is calling on the UK government to cut beer duty in the spring Budget to help pubs and brewers recover from a devastating year that has taken many to the brink of permanent closure. BBPA chief executive Emma McClarkin said: “We need the UK government to help our great domestic brewing and pub sector just as governments in Europe support their precious brewing and hospitality sectors. The Budget in the spring provides an excellent opportunity for our government to show their support for the 2,000 breweries and 47,000 pubs in the UK. A significant cut in beer duty will go some way in helping them recover from a disastrous 2020.”

Sacha Lord, night-time adviser for Greater Manchester, has said the government has tried to “silence” part of his legal challenge against the restrictions placed on hospitality this year. Lord has been battling for Downing Street to publish evidence that supports the tough restrictions imposed on pubs and restaurants. He has argued the sector has been treated unfairly, with restrictions causing a “disproportionate amount of harm to some of the most disadvantaged in our society”. Last week, Lord served papers to the High Court as his legal battle continued. But he said the government has now refused to release its Equality Impact Assessment Report (EIA) unless he signs a non-disclosure agreement. He said this was “another bullying tactic” used to delay and prevent the discussion surrounding hospitality closures. The gagging clause would prevent him from sharing information from the EIA, which will likely include the impact government decisions would have on particular groups of society. Lord said he has refused to sign the agreement, stating transparency and clarity was needed. He believes the forced closures, particularly of wet-led pubs, will lead to increased loneliness in the poorest areas, where pubs are often cornerstones of the community. The substantial meal rule, which bans the sale of alcohol unless with a meal in tier two areas, is also expected to have a greater impact on those with lower incomes who “can’t afford a meal out each time”. Lord said: “While I have no way of knowing the contents of the EIA, and it would be wrong of me to assume the evaluations within it, I believe the instruction to sign a gagging order is yet another bullying tactic used by the government to delay the publication of vital information and prevent the discussion around the closure of hospitality and its effects from moving forward. Next week, as we move into 2021, my thoughts will be with the operators across Greater Manchester who have spent thousands and thousands of pounds making their venues covid-secure, but who have been forced to close for more than 24 weeks this year without any scientific basis. While this is a testing time for all of us, I will continue to call on the government to provide the data which has merited this senseless and brutal scenario.”

The pubs code adjudicator (PCA) has published a list of eight recommendations Heineken-owned Star Pubs & Bars must fulfil after it was fined £2m for “unreasonable stocking terms in proposed market rent only (MRO) options tenancies”. An investigation by the PCA found Star Pubs & Bars had committed 12 breaches with the result it had “frustrated the principles of the pubs code”. As well as identifying how the company had offered stocking terms that had acted as a deterrent to tenants pursuing a free-of-tie tenancy, the PCA highlighted systemic corporate failures by Star Pubs & Bars in its approach to compliance. Along with the eight recommendations, it also said Star Pubs & Bars must publish a letter on its website explaining the findings of the investigation, what Star Pubs & Bars will do in response to the recommendations and how these measures will affect tenants. The recommendations were: 1. When making an MRO proposal, Star Pubs & Bars must follow PCA guidance, have evidence why its offer is reasonable, take into account and record factors it has relied on; 2. When serving an MRO proposal and negotiating with tenants, Star Pubs & Bars must be transparent and provide tenants with evidence supporting its grounds for reasonableness; 3. When Star Pubs & Bars receives an arbitration award relating to compliant MRO terms or new PCA advice, guidance or investigation outcomes, Star Pubs & Bars must be proactive in considering whether MRO proposals, in negotiation or arbitration, contain non-compliant stocking terms. Star Pubs & Bars must be straight with tenants about that non-compliance, offer a new proposal, be as open as it can on reasons for change and ensure policies are updated; 4. Star Pubs & Bars’ code compliance officer (CCO) role must be independent to challenge decisions that may be non-compliant with the pubs code. The CCO should ensure requirements of the CCO role are upheld; 5. Star Pubs & Bars must implement a system that supports the CCO’s duties under the pubs code. Any new system must provide for independent monitoring, further improvements to be made and a framework that evidences the effectiveness of its approach; 6. Star Pubs & Bars must ensure its record-keeping and administrative systems can support and evidence pubs code compliance; 7. Star Pubs & Bars must train its staff on findings from the investigation; and 8. Star Pubs & Bars must carry out an audit of its MRO tenancies to identify non-compliant stocking terms. Star Pubs & Bars must offer to change those terms without cost to the tenant. Star Pubs & Bars has appealed against the “disproportionate” £2m penalty.

Exeter-based tenanted pub operator Heavitree Brewery is to cancel rent in January in a bid to support publicans. The company is also only charging 50% rent in December for those pubs able to trade with those shut having their payments waived. The company stated: “In order to support our estate, all pub rental charges between April and July were cancelled. Charges in August were reintroduced at 25% of the usual rates, at 40% in September and at 50% in October. Following the second national lockdown, November rental charges were also cancelled. Owing to the challenging trading conditions associated with tier two, the company has taken the decision to charge at 50% for December, but only for those pubs that can trade, and to cancel all pub rental charges for January with what is anticipated to be a very difficult trading environment for the hospitality industry. The board continues to protect its cash flow by monitoring spending and suspending all capital projects. It continues to work closely with Barclays Bank, which has supported the company throughout. The company continues to work with its tenants to assist where possible and to interpret the announcements from government.” Heavitree operates more than 65 tenanted pubs across Exeter and south Devon.

Newcastle-based pub, restaurant and hotel operator Malhotra Group has reported Ebitda in its leisure division reduced to £100,000 for the year ending 31 March 2020, compared with £1.2m the previous year following a period of “significant” capital investment and redevelopment, together with divestment of non-core venues. Turnover in the leisure division reduced to £8.4m from £8.9m the year before. With regards to the coronavirus pandemic, the group said the investment it has made in its venues to provide a covid-safe environment means “we expect our trading to be robust when sites are permitted to open”. Total group turnover increased 9.3% to £38.1m compared with £34.8m the previous year. Ebitda rose 7.5% to £9.9m compared with £9.2m the year before, while pre-tax profit was up to £5.4m from £4.8m the previous year. The company also operates in the care home and property sectors. In their report accompanying the accounts, the directors stated: “We continue to invest in a significant capital expansion programme across the care and leisure sectors to improve the quality of services across our businesses.” Shareholders’ funds in the year also increased, by 21.6% to £78.8m.

Sales are down 64.3% year-on-year for tier two venues, for December to date, according to analysis by S4labour, the online labour-scheduling management system from Catton Hospitality. As a result of the restrictions placed on hospitality, food sales are down 55.3% and drink is down a significant 72.5%. S4labour said given tier one is a tiny percentage of the country, these tier two figures are the best-case scenario for the majority of the hospitality industry, most of which is now in tier three or four, and down more than 90% year-on-year. London has fared worse, down 71.1% year-on-year, while the rest of the country is down 61.9%. These figures in the capital are set to drop even further given the recent announcements regarding further restrictions on people’s movement, S4labour said. Chief product officer Richard Hartley said: “The ever-changing covid restrictions continue to have a damaging effect on the industry as expected, and Christmas this year is now set to look even more uncertain than previously expected.”
S4labour is a Propel BeatTheVirus member

Peter Backman Sector analyst Peter Backman (pictured) has said the culture of hospitality is dying and it could be down to businesses having to use delivery-only models or the immense pressure operators are being put under. Backman said: “Last week, a little bit of hospitality died. At the end of my road, there is a small, husband and wife-run burger restaurant. I’ve been going there for several years. Last week, I needed to have a word with the owners. The door was closed so I knocked and they looked up – she shook her head as if to say ‘go away’. I knocked again, and he got up, walked over to the door and pointed to a handwritten sign saying ‘Deliveroo, UberEats, Just Eat deliveries only’. And he shook his head. That is when the little piece of hospitality died – killed by covid, or delivery, or a dreadful combination of both. I shall be reluctant to return. And also last week, there was an anguished article in the Financial Times written by co-founder of Peach Pub Company, Jo Eames. She rustled up an image of pub life with a “bishop talking to a groundworker” at the bar. And then she railed against the collateral damage caused by the government’s imposition of regulations designed to cope with covid that forbid such conversations and lead to the death of hospitality. But these images of the death of hospitality are at odds with the many, genuine stories of care. From the supply of free food to NHS workers to practical help for colleagues – consideration for others lies at the heart of hospitality. So, the lesson isn’t that covid (or delivery) is killing hospitality. It is that it will be allowed to do so, so long as we don’t do anything about it.” Backman also noted although there have been plenty of people saying restaurants are safe places to eat, there must also be good reasons for their closure. He said: “Sir Patrick Vallance told a meeting on 9 December: ‘If you look at the data around hospitality, there is a series of environmental factors, such as the fact people cannot, by definition, wear masks; you are meeting lots of people you would not normally mix with; you are in an indoor environment; and ventilation may not be adequate’. In other words, the conditions in which we enjoy hospitality are ripe for the spread of covid. It seems to me the reasons why restaurants are locked down are not articulated clearly or at all by those imposing the lockdowns. I would ask politicians to be clear and open so grown-ups can understand why the hospitality sector is locked down. And if there is no hard evidence but a great deal of well-argued and well-supported, but nevertheless, circumstantial evidence, then we should all be treated as sufficiently grown up to understand that.”

Jeremy King, co-founder, Corbin & KingJeremy King (pictured), co-founder of London restaurant operator Corbin & King, has said the hospitality sector is still not accorded the recognition nor respect “we deserve as one of the top three revenue generators in this country”. Speaking in support for the creation of a minister for hospitality and the Seat At The Table campaign, King said: “I am just incredulous that after some 45 years in the hospitality industry I am still witnessing my colleagues and I treated as second-class citizens. We are still not accorded the recognition nor respect that we deserve as one of the top three revenue generators in this country. The fundamental omission is that of representation in parliament. How many other industries with three million direct employees and another indirect 1.6 million are so badly represented? We have patiently awaited ministerial representation but now our patience is exhausted and we are forced to demand it.” The Seat At The Table campaign, which has been founded by Robin Hutson, chairman and chief executive of Home Grown Hotels and the Lime Wood Group, has so far generated circa 160,000 signatures on a petition asking for the creation of a minister for hospitality. Parliament will debate the petition on Monday, 11 January.

Spencer Craig, founder of Pure Healthy food-to-go concept Pure has secured £3m from the Coronavirus Business Interruption Loan Scheme (CBILS) with Lloyds Bank to help it through the crisis, Propel has learned. The 21-strong company, which launched a company voluntary arrangement (CVA) in September, said it entered into the agreement on 7 October with its creditors, which has linked the majority of rent costs to sales over a two-year period. On 23 March, in response to UK government guidance to close all hospitality and shops, the company announced it would temporarily close all of its 21 sites in London. It began a phased reopening of shops beginning in July and by September, 20 shops were trading. However, turnover was only at 30% of pre-pandemic levels. On launching the CVA, co-founder Spencer Craig (pictured) told Propel: “We really did not want to do a CVA. It was the last option we considered. We took every other possible measure but, in the end, the lack of people in central London has led to an unsustainable position for us.” News of the CBILS came as the business saw its full-year turnover break through the £25m mark for the first time, in the 12 months to 26 December 2019. Full-year turnover stood at £25.7m, up from £19.1m in 2018, with four new sites opened during the period. The company stated: “2019 was the third year of a four-year growth strategy to triple the size of Pure from £11m sales in FY16 to £33m-plus of sales in FY20. We are delighted to report 2019 sales were on track to meet this target with sales growth of 34% and total sales in excess of £25m for the first time.”

Niche Katona founder of MowgliIndian street food concept Mowgli has lined up its second site in Scotland, in Glasgow. Propel understands the 11-strong company, which recently confirmed it will open in Edinburgh, in the former Clydesdale Bank branch in Hanover Street, has secured the ex-Handmade Burger Co site in St Vincent Street in Glasgow. It is thought the company, which is backed by Foresight and led by Nisha Katona (pictured), has secured a new lease on the site. Last week, Mowgli founder Katona confirmed plans to open a site in Edinburgh on 22 January. She wrote on Instagram: “All being well, Cheshire Oaks (will open in) February and Bristol late spring, Edinburgh (on) 22 January. But I’m looking at whether to go to Glasgow, Brighton and Cheltenham in the next couple of years too.” At the start of November, the group, which is chaired by Karen Jones, secured a site in the McArthurGlen Cheshire Oaks Designer Outlet, with the opening scheduled for spring 2021.

Zoe Bowley, Managing Director, UK & IRE. PizzaExpressPizzaExpress, the David Campbell-led business, is to restructure its management team, which will include the creation of two new roles, a chief customer officer and a chief business officer, Propel has learned. As part of the restructure, current UK managing director Zoe Bowley (pictured) will see her remit expanded to also oversee the group’s international restaurant division. Andy Pellington will step down as chief financial officer, a role he has held for seven years, next March, after overseeing the recapitalisation of the business earlier this autumn. The finance role will come under the new chief business officer’s remit, as well as overseeing the group’s supply chain and procurement functions. The group’s new chief customer officer will also oversee the brand’s marketing function, as part of their remit, with the business currently without a marketing director. Both roles are currently being advertised for, with appointments expected early next year. The group’s management team is completed by Kate Daines, who joined from Costa in 2018 to become PizzaExpress director of people for UK and Ireland, was appointed people director for the region and promoted to the UK leadership team last year. Campbell, the former chief executive of Wagamama, was appointed group chief executive of PizzaExpress at the start of November, as the chain announced the completion of its recapitalisation. Campbell, who led the turnaround at Wagamama, and most recently Bill’s, where he was executive chairman, was joined on the new PizzaExpress board by former Asda chief executive and ex-Wagamama chairman Allan Leighton. PizzaExpress also announced the completion of its recapitalisation, which the company said would give it “a strong balance sheet and significant funds to invest in growth in the years ahead”. The company’s new capital structure saw its total debt reduced from £735m to £319m, and included the immediate injection of £40m of new capital. In addition, the business was provided with a further £90m of funds available from the new owners. The recapitalisation saw the Beijing-based Hony Capital, which acquired PizzaExpress for circa £900m in July 2014, depart the business, but keep its China-based operation.

JD Wetherspoon chairman Tim Martin has told Propel unless the hearts and minds of customers are won over, this “heartless government’s propaganda machine will put us all out of business”. Martin said Alex Reilley, chairman of cafe-bar operator Loungers, had “hit the nail on the head” when he said the industry needs to “win the hearts and minds of the good people of the UK”. Martin said: “Wetherspoon is trying to achieve this by a magazine (available on Wetherspoon’s website) on every table in every pub, with comments from doctors and scientists, which criticise government policies – and make the case for hospitality. If every hospitality company put just three articles we’ve used in the magazine on their tables, Alex’s objective would likely be achieved. The first is an open letter to the prime minister by Dr Rosamond Jones and several hundred medics and scientists, which opposes lockdowns and makes the case for a more proportionate approach. The second is an article by freelance journalist Ross Clark in the Daily Mail, which brilliantly undermines dodgy government propaganda. The third is an article by economics editor Larry Elliott in the Guardian, which also criticises lockdowns and highlights the relative success of the Swedish approach. No one from government has been able to lay a finger on these critics. The government has, instead, relied on ‘Project Fear’ to keep public opinion onside. Too many people in the industry, with honourable exceptions, are hiding behind UKHospitality and haven’t had the courage to make the arguments for an alternative approach directly to their customers. But, unless the hearts and minds of customers are won over, this heartless government’s propaganda machine will put us all out of business. As Bob Dylan warned years ago: ‘You’d better start swimming, or you’ll sink like a stone, for the times they are a-changing’.”

The night-time economy and hospitality sector “has lost all confidence in the government strategy against covid,” the Night Time Industries Association (NTIA) has said. Speaking after prime minister Boris Johnson brought in new tier four restrictions in London and parts of south east and eastern England, NTIA chief executive Michael Kill said there was “disbelief and anger” among the sector the government kept other industries open “during such a delicate period within the crisis”. He said: “The unrelenting closing and reopening of businesses is costing owners hundreds of thousands of pounds, and coupled with the erratic decision-making around restrictions, is rapidly destroying the ability of the sector to bounce back. Thousands of businesses and employees have supported the government’s public health campaign against covid, creating safe, regulated environments for people to socialise. This financial burden and commitment has been recognised only in lip-service, with insubstantial support measures to repay confidence in the sector. There is disbelief and anger among the sector the government did not foresee the impact of transmissions by keeping retail, education and other sectors open during such a delicate period within the crisis. If the prime minister wants the hardest-hit sectors to continue to support the government in its public health strategy against covid, then he must compensate the businesses fully for their losses, and deliver a robust exit strategy to regain industry confidence.”

Restaurant waiter with mask The impact of lockdown is felt long after venues are allowed to reopen, according to research by hospitality software start-up Stampede. Its report, which analysed UK hospitality interactions in 2020, claimed it takes time for people to come back to pubs, bars and restaurants once lockdowns have been lifted and the hospitality sector cannot be “turned on and off like a tap”. The report said: “If people get used to the idea of staying in, or believe it is their duty to do so, changing the law to allow hospitality venues to reopen will not prompt people to do so overnight.” Graphic evidence showed a steady return of custom after reopening in early July that peaked at the end of August. Additionally, December showed a similar slow rise as people returned to hospitality before further tier restrictions were implemented. Stampede chief executive and founder Patrick Clover added: “The government may have chopped and changed its stance on hospitality restrictions, but human behaviour takes far longer to adjust, and the impact of lockdown is felt long after venues reopen. This is far from being a doom and gloom report, however. It explains how the UK’s wonderful hospitality venues reacted to lockdown and how real customers behaved in such strange times. It’s our view they have acted far more responsibly than they have been given credit for.” The report also discovered the government-enforced 10pm curfew had little effect on hospitality sites because customers had already abandoned late-night drinking and the success of the Eat Out To Help Out scheme was at the expense of more traditional weekend trade. The report’s key findings included 48.1% of UK restaurant visits during the Eat Out To Help Out initiative took place on Monday, Tuesday and Wednesday, with Wednesday becoming the most popular trading day of the week. Even though it did cannibalise weekend trade to some extent, the scheme brought in more business than restaurants lost on traditional weekend trade. It also discovered customers moved away from late-night drinking and dining long before the curfew was introduced at the end of September as pubs, bars and restaurants all experienced earlier spikes in traffic in July and August versus 2019. Interactions showed venues were far more dependent on regular or returning customers post-lockdown rather than bringing in new customers. And customers did not go overboard when pubs reopened on 4 July – dubbed “Independence Day”. Pubs had a similar number of customers during that weekend compared with most in July, and only a fraction of the numbers recorded in August, September and October.

McDonald’s will stop serving toys made from non-sustainable hard plastics with its Happy Meals from 1 January. The initiative will remove more than 3,000 tonnes of plastic from circulation. In the new year, the Happy Meal will only include soft toys, sustainable paper-based gifts or books as McDonald’s looks to viable alternatives to hard plastic. Beth Hart, vice-president of supply chain and brand trust at McDonald’s UK, said: “Removing hard plastic toys from our Happy Meal next year will see more than 3,000 tonnes of plastic removed from our supply chain and is a big step in our ongoing sustainability journey.” More than one million Happy Meal toys have already been recycled and used to create the first of 15 playgrounds, which opened close to Oxford Children’s Hospital and is available for the use of families staying at the 62-bedroom Ronald McDonald House Oxford. The house provides a home away from home for the families at the hospital and the playground will provide respite for children being treated at the hospital and their siblings.

The Restaurant Group (TRG) has said it will have 103 sites shut from tomorrow (Saturday, 19 December) as a result of the latest tiering restrictions – an increase of almost 40 sites from previously. TRG said the closures were because trading from these restaurants would be “uneconomical”. The company will now have one restaurant in tier one in England, as opposed to none previously, but will see the number in tier three rise from 80 to 142. There will be 100 sites in tier two, down from 202 previously. The company stated: “As per the latest tiering restrictions announced by the UK government, The group will have approximately 145 sites that will trade for dine-in across the UK , 142 sites which will provide delivery and takeaway services only, with the remaining 103 sites closed. This is significantly worse than when the initial tiering restrictions came into effect. Clearly the mix of locations impacted across the tiers will continue to evolve, but if UK tiering allocations were to remain the same as currently in place throughout the first quarter of 2021, this will have a significant adverse impact on the group, and indeed the wider hospitality sector. While the tiering restrictions make the outlook for the first quarter of 2021 extremely challenging, the board is encouraged by the welcome news of the covid-19 vaccine being rolled out in the first half of next year. The board believes the group is well positioned to benefit from a sustained removal of restrictions given its previous strong trading performance following the first lockdown. We therefore expect a strong recovery when there is a return to more normal levels of customer activity. The timing of that will depend primarily on government restrictions being eased.” TRG also stated through a range of “decisive” management actions, cash-burn during the November national lockdown was minimised to circa £5.5m for the month. This is £2.0m higher than during the first lockdown due to rents payable under the terms of the leisure division company voluntary arrangement as well as employer contributions towards furlough payments. Additionally the working capital outflow and increased cash exceptional costs as a consequence of the November lockdown totalled £15m.

Revolution Bars Group chief executive Rob Pitcher Rob Pitcher (pictured), chief executive of Revolution Bars Group, which operates the Revolution and Revolución de Cuba brands, has told Propel the government’s actions are “forcing people out of the industry they love”. Speaking after the company’s full-year results were posted, Pitcher said while the company had made 200 staff redundant, the business had actually lost nearer to 1,000 employees because they had been forced to look for work elsewhere due to the uncertainty. He added that with businesses across the sector in a similar position, the number of jobs lost in the industry since the pandemic began was around 660,000 rather than the 300,000 the Office for National Statistics reported this week. And with the vaccine now being rolled out, Pitcher said the government had no excuses not to end the tier system at the start of February. He said: “Before the pandemic, we employed 3,200 people and now it’s about 2,200. We’ve lost a third of the jobs we support. People say they love working here but with all the uncertainty they can’t afford to pay their rent and have to go elsewhere. This industry provides so many young people with their first experience of work. The government is forcing so many people out of an industry they love and we love having. The government has got to stop using hospitality as a scapegoat. It’s quite clear we are not the reason for the spread. Look at Kent, for example. It’s in tier three, hospitality is shut and the case numbers are still rising. Why does non-essential retail get to remain open? The evidence shows hospitality is ‘responsible’ for between 1% and 4% of cases and, in education, it’s north of 20%. How can university students be able to mix in that setting but not be allowed to do so in a pub or bar?” Pitcher said 40 of its 67 sites were shut as a result of tier three restrictions. It has 26 sites in tier two and just one at the tier one level – in Inverness. Pitcher said even that site is only doing about 50% of its trade of last year. Pitcher said he did not envisage the company exiting any further sites following the company voluntary arrangement and was instead looking at potential opportunities – although any expansion would come towards the end of next year or the start of 2022. He added: “We’ve done a lot of hard work over the past 18 months and believe, when restrictions are lifted, we can get back to where we were. We have a good offer, our like-for-likes sales were up almost 2% in the ten weeks prior to the march lockdown and we’re seeing an almost 60% return on investment from our refurbishment programme. We’ve improved technology – 80% of transactions are being done through order and pay and we have 550,000 app users.” With regards to the Nightcap plans that sees a new company led by hospitality entrepreneur and ex-Dragons’ Den investor Sarah Willingham floating on the stock market, Pitcher said: “We wish it well and it’s great to have another company in our sector on AIM. We see similar opportunities and if the right ones come along we are in a position to take advantage.”

Rick Bailey, executive chairman of brewer and retailer Daniel Thwaites Rick Bailey (pictured), executive chairman of brewer and retailer Daniel Thwaites, has warned the government the continued “nightmare” of restrictions on the sector is a “hangover we will not recover from”. In a letter to Downing Street, he described being in the middle of a rainforest and “our industry is burning down around me”. He said: “The lack of movement downwards in the tiers in favour of universal tightening, arbitrary decision making, lack of transparency, lack of evidence, five days of Christmas, ‘Project Fear’, new strain scaremongering to frighten us further, illogical targeting of pubs, opening of retail, gyms and massage parlours, takeaway kebabs, leg waxing, synchronised swimming and the rest of it is now totally dysfunctional. Is anyone actually looking at this from above? If they were, why construct this depressing cocktail to torture and poison us all over Christmas or at any other time – we won’t recover from this hangover. It is difficult for me to air louder my anger at these latest developments – particularly with this furlough extension – why do that now, in the middle of December, unless you have no confidence about the efficacy of the vaccine roll out and want to roll back off the ‘it will be fine by Easter’ message? None of this has any integrity anymore and it reflects in the most appalling way upon the leadership of this country. We could all buy into a plan, even if it has to change, if we are properly communicated with rather than being treated like idiots with no wider awareness or perspective. I am in the middle of the rainforest and our industry is burning down around me – our business will in some way, I hope, find our way through this; however for our tenanted pubs, bars and night economy across the nation their livelihoods and lives are being destroyed. We have been running, and helping to run, community pubs for more than 200 years; they are the absolute beating heart at the centre of their communities and the good that they do for social health is misunderstood, unrecognised and is being destroyed – this continuing closure of these social hubs even when infection levels are low, and with the safety measures they have taken, is now just plain wrong, on every level. These landlords are the ones who will have no Christmas and for whom 2021 will be their lowest point as they are destroyed by this – purposefully, on a gut feel pubs are bad. How much more misguided could our crisis management team or government cabinet be – these poor pubs have now been abandoned by them; and yet if protected they would be the ones to pick up our communities, who they know so well, when we reach the other side. Better still, once they recover, their tills will start to refill the coffers of the Treasury from the enterprise they deliver. There is no real prospect of relief at the next tier review as the health Stasi will want to frighten the cabal into waiting to see what damage has been done from their strategy over Christmas and the NHS will frighten everyone it might be overwhelmed, even though it has more capacity than last year with no covid – it really is hopeless this Christmas, and actually very, very sad. All we can do is shout louder to save our pubs and hospitality sector – in the hope the faint echo of our pain will reach the two to three people that can change this nightmare and that this Christmas they will care enough to act.”

The UK’s hospitality sector has taken a hit of more than £53bn worth of lost sales this year – and more losses are expected as Christmas trading collapses – according to the Future Shock report from CGA and UKHospitality. However, a coronavirus vaccine has been cited as grounds for cautious optimism in 2021. “Survival to Revival”, the eighth edition of the Future Shock report, which draws on business insights consultancy CGA’s suite of business and consumer sources, showed there has been a £53.3bn year-on-year drop in sales between the start of April and the end of September; consumer confidence fell as 78% of Brits were concerned about the long-term financial implications of the pandemic; 27% of leaders of multi-site groups predicted they will be unviable by mid-2021 with the current levels of support; and the prospects look bleak this Christmas as 98% of England’s licensed premises remain under tier two and three restrictions. But the report has also celebrated the hard work and achievements of operators and suppliers – especially in keeping people safe. It showed 95% of consumers have been satisfied with the level of hygiene in venues this year, and 55% said they feel safer in hospitality venues than in shops and supermarkets. Trends and developments for businesses to track in 2021, include an acceleration in consumer use of technology in restaurants, pubs and bars; a further increase in delivery sales – of alcoholic drinks as well as food; a continuation of the lockdown trend of eating and drinking close to home rather than travelling to city centres; and increased availability and affordability of property in the wake of business failures. Karl Chessell, business unit director, retail and food at CGA, said: “There have already been many business casualties in our sector and more will inevitably follow as a result of the onerous limits on trading and socialising at what should be the busiest time of the year. But among businesses that have been able to sustain themselves, the pandemic has instilled a resilience and innovation that will stand them in good stead for years to come.” UKHospitality chief executive Kate Nicholls added: “Undoubtedly, 2020 has been a disaster for the sector. There is, though, every chance that with the right support, businesses can begin to trade their way out of danger and towards some degree of prosperity next year. The rollout of a vaccine should give us all confidence that the next year will be dramatically better than this one.” Meanwhile, CGA now has 60 partners to participate in its Coffer Peach Business Tracker, which monitors sales among managed pubs, restaurants and bar groups. It reached the milestone with the recent additions of Nando’s, BrewDog, Cote Restaurants, Drake & Morgan, Giggling Squid, Oakman Inns & Restaurants, Rosa’s Thai Café, Star Pubs & Bars and Tattu.

The British Beer & Pub Association (BBPA) has said the increase in regions placed under tier three restrictions means the future of Britain’s pubs hangs by a thread this Christmas. It said the changes mean more than 32,500 pubs will now be at risk of permanent closure under tier two and three restrictions – 85% of the total in England. The BBPA said, without such support, a further wave of pub closures is inevitable heading into the new year. Chief executive Emma McClarkin said: “It is clear it is going to be longer than we thought until our pubs can open properly and be viable businesses again. The prime minister and chancellor have no excuses. They must now secure pubs and jobs by giving locals in England the same support as those in Wales. Without such support, a wave of pub closures is guaranteed at a time when they should be leading the economic recovery.” UKHospitality warned placing more regions into tier three would bring further despair to already hard-pressed businesses and bring Christmas heartbreak for hospitality. Chief executive Kate Nicholls said: “Businesses will have bought stock that will now go to waste and more people will lose work at a stressful time. Hotels are now facing a deluge of short-notice cancellations because of the tightening of restrictions. What was already looking like a bleak Christmas is now looking like a total write-off. More financial support must be forthcoming if we are to have any hope that these businesses will survive. They can trade their way out of danger next year only if they are still around to do so.” Tom Stainer, chief executive of the Campaign for Real Ale, said: “This week, thousands of consumers, publicans and brewers have taken to Twitter to share why #PubsMatter to them. Ministers must recognise local pubs are a force for good, bringing communities together and playing a key role in tackling loneliness and social isolation. Allowing a limited number of people to socialise safely in covid-secure pubs in all tiers is vital not just for businesses – but also for our communities and to people’s mental well-being.” The Campaign for Pubs said the government was treating pubs and publicans “disgracefully” and without urgent and meaningful support, will be responsible for the closure of thousands of pubs. Greg Mulholland, campaign director for the Campaign for Pubs, said: “The government either doesn’t understand or doesn’t care its failing strategy is destroying livelihoods and consigning many pubs to history. It must now come up with an urgent and meaningful package of support or it, not covid, will be responsible for the loss of thousands of pubs and for hardship faced by many families.”

The Abokado site in HammersmithLondon-based healthy eating chain Abokado, which was sold in a pre-pack administration in October, was acquired for circa £70,000, Propel has learned. The 19-strong business, founded in 2004 by Mark and Lindsay Lilley, was acquired by a new vehicle – Montway Holdings – which was set up by the chain’s founders. Benjamin Wiles and Geoffrey Bouchier, of Duff & Phelps, were appointed administrators on 13 October and a pre-packaged administration sale was executed shortly after, but Abokado’s entire workforce was made redundant. Following the engagement of Duff & Phelps by the company in July, an accelerated marketing process was commenced with the business being marketed on an insolvent basis to a selected audience of prospective interested parties. The administrator’s report stated: “Feedback from other interested parties during the marketing period raised similar concerns in respect of the opportunity, with the main reasons for not submitting an offer for the business and/or assets being the impact of covid-19, time-frames being too short in order to conduct due diligence in a timely manner, and the company’s turnover being too low for some parties.” Due to the lack of response from its initial list, Duff & Phelps approached a larger target group that does not operate directly in hospitality and leisure, but may have an interest in the opportunity. It received non-disclosure agreements from nine interested parties. However, by the initial deadline date of 26 August, Duff & Phelps did not receive any offers for the business and/or assets except from Lilley. Therefore, the deadline was extended with all final offers to purchase the business and assets of the company as a going concern, together with full proof of funding, was set for 11 September. Following the expiration of this deadline, Duff & Phelps received an offer from Lilley on 11 September for £70,000 with respect to certain business assets of the company. The terms of the offer were £70,000 was payable upon completion for the assets and a further contribution towards the legal costs of the transaction. The offer was subsequently reduced by £2,500 when it was established the assets at one of the stores could not be recovered. The transaction completed on 14 October for a consideration of £67,500 for the assets of the company and a further payment of £3,000 for the legal costs associated with the sale. Kings Park Capital invested £4.5m in the company since initially backing it in 2010. In May 2018, Abokado secured £3m from alternative finance provider ThinCats. The report states both were unwilling to put extra funds into the business, which continued to see its turnover continue to “significantly decrease” after it underwent a company voluntary arrangement in September last year.

SSP Group UK transport hub foodservice company SSP Group has reported its like-for-like sales for the year to the end of September 2020 fell 50.8%, as it was heavily impacted by covid-19 and the closure of most of the global travel markets since March. The company reported its revenue stood at £1.43bn, down 47.9% at constant currency, while its underlying loss before tax was £239.6m (2019: £203.2m profit). It said it had seen a good first half performance prior to the outbreak of covid-19, with strong net new space growth at 5.7% and further progress on its strategic initiatives. The company said it had carried out a “rapid and effective response to covid-19” to protect its people and the business, with “significant liquidity created, business ‘hibernated’ and units closed”. The company said its liquidity position remains strong, with cash and undrawn available facilities of around £520m at the end of September. The business said: “From very low sales in the third quarter of the year (93% lower year on year), passenger numbers increased gradually over the final quarter of the year and by the end of September were 76% lower year-on-year (averaging 80% lower year-on-year during the fourth quarter). In response to the recovery of the travel sector over the summer, we were able to open over one third of our units globally. Since the end of the year, the re-emergence of the virus and further lockdowns, notably in the UK and continental Europe, have resulted in further volatility in passenger numbers. As a result we expect sales during the first quarter of the 2021 financial year to remain broadly in line with the final quarter of the year, approximately 80% lower year-on-year. This volatility is expected to continue through the second quarter of the new financial year.” Simon Smith, chief executive of SSP Group, said: “Covid-19 continues to have an unprecedented impact on the travel industry and on SSP’s businesses in all geographies. We have taken rapid and decisive action to reduce costs, preserve cash and to substantially strengthen the group’s financial position. By renegotiating rents, rationalising our menus and reducing our unit overheads, we’ve created a new, more flexible operating model. This has allowed us to respond rapidly to passenger demand, successfully re-opening more than a third of our units by the end of September and delivering an important service to the travelling public. While we expect passenger numbers to remain subdued over the winter, we are optimistic that, alongside good progress with the vaccination programme, we will see a significant upturn in both domestic and international travel from the spring. We are ready to respond quickly.”

Christmas dinnerAllowing people to gather in “unregulated” homes over Christmas but banning mixing in pubs is “making a mockery” of the industry, British Beer & Pub Association chief executive Emma McClarkin has told MPs. Speaking to the public administration and constitutional affairs committee, McClarkin said “the ban on actual household mixing inside our venues within the tiering system is absolutely devastating for the pub sector”. She added: “We are a community hub and we’ve invested millions to make us covid-secure. It is actually making a mockery by banning us from allowing people to mix and meet together when the government has now introduced a Christmas plan that allows them to do that in private, unregulated and unsafe settings where all bets are off.” Under tier three regulations in England, hospitality businesses must close to sit-in customers and can only offer takeaway or delivery. Under tier two restrictions, people can go to the pub but must only do so with other members of their household or support bubble. McClarkin told the committee: “The vast majority, I have to say, are abiding by those rules – and that’s pubs and pub-goers. We absolutely support enforcement measures. If pubs are flouting those rules then I think they should have action taken against them because they are undoing the absolutely sterling work the majority of pubs are doing. Inevitably, we will rely on the information we’re given from customers and their ability and desire to want to comply with the rules.”

Restaurant Closed – Economy – CovidMore than a quarter of UK pub and bar-owners said they feared their business would fail even before the latest lockdowns in London and the south east – leading to the Liberal Democrats calling for “radical action” from the government. Figures from the Business Impact of Coronavirus Survey published by the Office of National Statistics showed 27.9% of pub and bar businesses had low or no confidence in surviving the next three months against 5% for all businesses. Fewer than one in five pubs (19%) have “high confidence” they will survive the next three months while for businesses generally it’s 60%. A quarter (24%) of pubs have less than one month of cash reserves remaining versus 9% of all businesses – and 10% of pubs have no reserves at all. The survey referred to the period from 2 to 15 November, as England was entering a month-long lockdown and shows the huge amounts of stress hospitality businesses were under even before London, most of Essex and parts of Hertfordshire were moved into tier three on Wednesday (16 December). Following the survey, the Liberal Democrats have joined hospitality bosses in calling for more support for the industry. Lib Dem deputy leader Daisy Cooper said: “With so many pubs worried they won’t be able to survive the next few months of the pandemic, alarm bells should be ringing across government. The chancellor must take radical action – he must increase grants so they cover fixed costs during restrictions, guarantee furlough will be extended for as long as pubs can’t operate properly and provide an income for landlords so they can eat and provide for their families. Failure to act will leave a gaping hole in communities across the UK.”

Propel has launched a campaign called BeatTheVirus to help operators through the coronavirus crisis.

We have teamed up with Propel Multi Club conference series partners to offer the sector their expertise. Partners will offer more general advice and highlight some of the initiatives they are doing.

Companies supporting the BeatTheVirus campaign include Airship, Bums on Seats, CACI, Christie & Co, COREcruitment, CPL Learning, Cynergy Bank, Elliotts, Hastee, haysmacintyre, John Gaunt & Partners, KAM Media, Prestige Purchasing, S4labour, Startle, Ten Kites, The NPD Group, Toggle, Trail, Venners, Wireless Social, Yapster and sector trade body UKHospitality.

Propel managing director Paul Charity said: “It is amazing to see how the industry has come together during this crisis and here at Propel we want to do our bit. This is why we are working with Multi Club partners to offer expert support and advice to our readers and to answer their questions at what is a tough time for everyone.”

Readers can email questions for our experts to Please use BeatTheVirus in the subject line.

More than 300 readers have now signed up to Propel Premium – while those joining the new-look Propel Premium Club can save money by receiving a pair of free tickets to one of four conferences in 2020.

Propel Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out, discounts to attend Propel conferences and events, and regular columns from insights editor Mark Wingett. Subscribers also receive access to our database of multi-site companies, which has grown to 1,500 businesses.

Meanwhile, subscribers to the new-look Propel Premium Club will be able to choose to use a pair of free tickets to one of the following conferences – The Delivery Conference (Tuesday, 21 April), The Finance and Investment Conference (Thursday, 14 May), The Casual Dining Summit (Monday, 12 October) or The New Concept Conference (Monday, 19 October). The normal cost of two tickets to these events is £490 plus VAT for operators and £690 plus VAT for suppliers.

An annual premium subscription costs £395 plus VAT for operators and £495 plus VAT for suppliers. Email

Mark McCullochOperators can map their marketing strategy for 2020 through a video collection that features all sessions from the Social Media for Profit Masterclass. The videos reveal how to build sales and brands using social media and are taken from the social media boot camp hosted by Mark McCulloch (pictured), who has more than 20 years’ brand, marketing, digital and social media experience that includes senior positions at Pret A Manger and YO!

McCulloch reveals the hot trends and tips for 2020 and what social media strategists should focus on including channels, content and untapped areas you may be neglecting. He also reveals how businesses can grow their reach by creating a personal brand and using their most senior people to make that brand more human, relevant and accessible.

McCulloch is joined in the video series by Alison Battisby, founder and director of social media consultancy Avocado Social, who has ten years of social media experience and is a Facebook-accredited trainer. She reveals the best way to use Instagram to drive bookings and the do’s and don’ts of working with influencers. She also reveals how to ensure your social media adverts are working successfully.

Meanwhile, Move Digital founder and managing director Geraint John reveals why voice activation is so important, what it can do for your business, where to start and how to build your voice strategy before you launch a new way to reach your customers that will leave your competitors behind. The full video collection is £295 plus VAT.

To order, call Anne Steele on 01444 817691 or email

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Friday Wrap with Charlie McVeigh
The Propel Friday Wrap:

Featuring Mark Stretton, Mark Wingett and Charlie McVeigh

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John Gaunt
Legal Briefing

from John Gaunt & Partners

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Krishnan Doyle – Supplier interview
The Supplier Perspective

Mark Wingett talks to Krishnan Doyle

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People & Training Conference

People & Training Conference: Abi Dunn talks to Karen Bates, people director at Brewdog

The virtual People and Training Conference

in association with the BII

Abi Dunn talks to Karen Bates, people director at BrewDog

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Propel Premium Club

Propel Premium Club annual subscription operator subscription costs £395 plus VAT and a supplier subscription costs £495 plus VAT
Benefits include:
  • A pair of free tickets to an event of your choice
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  • Plus insight from leading sector commentators from the UK and internationally

CONTACT: Anne Steele on