December Trading Pushes Sector Like-to-Likes Up 9.9%
January 17, 2012
Britains pub and restaurant groups enjoyed a major sales boost over Christmas and New Year. Collective like-for-like sales for December were up 9.9% on the same period last year, with total sales ahead 13.7% on December 2010, according to latest Coffer Peach Business Tracker data. The figures come from the Coffer Peach Business Tracker*, the industry sales monitor for the UK pub and restaurant sector, which collects monthly performance data from 23 major pub and restaurant operators.
Much of the increase can go down to the fact that there was no snow this December, which disrupted trade last year. However, the underlying trend is still encouragingly positive, said Peter Martin of Peach Factory, the business intelligence specialist that produces the sector Tracker, in partnership with KPMG, UBS and the Coffer Group.
Last December, like-for-like sales were down 4.2% on 2009, with total sales falling 3.4%, as snow badly disrupted business in the run up to Christmas. Nevertheless, even allowing for that, December 2011 like-for-like figures are still a healthy 5.3% up on two years ago, added Martin.
Despite the continuing economic gloom, people are still going out to eat and drink particularly over holiday periods. The leading pub and restaurant operators have worked hard to keep their offers fresh and relevant, and have come through the downturn in relatively good shape certainly better than p[arts of the retail market.
This is also reflected in the fact that December was the sixth month running that the eating and drinking-out-of-home market has seen positive trading. Like-for-likes increased 2.1% in November, 0.9% in October, 2.8% in September, 0.6% in August and 1.0% in July, added Martin.
The almost 10% jump in pub and restaurant group numbers last month was in contrast to the retail sector, which saw only a 2.2% increase in like-for-like sales in December, according to the British Retail Consortium / KPMG Retail Sales Monitor.
Trevor Watson, director at Davis Coffer Lyons, commented: Notwithstanding the favourable weather in December 2011 as against 2010, these figures are a strong endorsement of how well pub and restaurant operators are doing in driving their businesses forward.
Against a background of fragile consumer confidence, consumers are still choosing to spend their leisure time and money eating away from the home. This is because operators are continuing to offer improvements in service and value. Brands with representation in regional shopping centres, leisure parks and airports in particular are experiencing relatively strong trading conditions, while traditional high street locations are generally finding trading more challenging.
Richard Hathaway, KPMGs Head of Travel, Leisure & Tourism, added: “The major pub and restaurant operators saw a significant rebound in sales last month. This comes as a welcome relief for the sector after three very difficult festive periods in a row. In December 2008 operators felt the first big impact of the recession, December 2009 saw little year on year improvement – like for likes recovered by less than 3% that year – and then December 2010 saw the big chill.??”December also saw total sales growth again outstrip like for like sales growth, by almost 4%, reflecting the impact of continued investment in new openings by the UK’s major operators in 2011. This demonstrates the confidence shown in what remains a relatively robust sector, despite the weak economic and consumer environment.”
Jonathan Leinster, Head of UBS European Leisure Research, commented: UK pubs stocks have continued to weaken, down on average 27% in the last year, in part due to ongoing concerns over UK consumer spending. Todays numbers suggest that pub spending around the holiday period was far more buoyant than results from high street retailers might imply, although we dont expect this to mark a new trend. The latest UBS UK household cash flow published in November indicates that cashflow pre-savings should rise 1.6% in the current year, a significant improvement on 2011. We believe that consumers do find value in some of the pub offerings and maintain Buy ratings on JD Wetherspoon, Marstons and Greene King.
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