16 October 2013

Pub and restaurant groups see sales growth slip in September

• Collective like-for-like sales ahead just 0.4% on last September
• Restaurant chains worst hit; London pubs top performers

Britain’s pub and restaurant groups saw sales growth slow in September after a summer of solid trading. Collective like-for-like sales grew just 0.4%
compared to the same month last year, according to latest figures from the Coffer Peach Business Tracker.

“The good summer weather has been generally good for the eating and drinking market – but September seems to have delivered something of a hangover for the sector. Sales growth last month was the lowest since April,” said Peter Martin of
CGA Peach, the business intelligence specialist that produces the Tracker, the sector’s most comprehensive performance barometer, in partnership with Coffer Group, Baker Tilly and UBS.

“Sales particularly suffered during the first two weeks of the month, but saw a recovery in the second half,” he said.

Total sales across the 27 companies contributing to the Tracker grew 3.1% during September, reflecting the continued roll-out of new sites, particularly from casual dining chains outside of London.

“Nevertheless, branded restaurant chains collectively had the worst of the sales slowdown, with like-for-likes nationally down 1.0% on last September,” added Martin.

“The best performance for the month came from London managed pubs, which were up an impressive 3.4% on last year – and which helped the capital overall marginally outperform the rest of the country. The combination of drink and food appears a compelling mix for consumers inside the M25,” he observed.

The longer-term trend shows that the market remains just positive, with year-on-year like-for-likes for the 12 months up to the end of September running at just 0.7% up on the previous 12 months. Total sales growth is running at 4.1% up.

Mark Sheehan, managing director of Coffer Corporate Leisure, said: “While like-for-like sales in September were only marginally up, this followed a summer of excellent weather and great growth for the eating and drinking out sector. It is also important to note that September 2012 saw relatively strong trading after the Olympic summer and thus was a pretty robust comparable. The outlook remains excellent and we have been experiencing our strongest level of transactions since 2008.”

Paul Newman, head of leisure and hospitality at Baker Tilly UK, added: “The UK market as a whole exhibited like for like growth for the sixth consecutive month. However, as always the devil is in the detail. As we turn towards the longer, colder evenings, managed pub chains appear to be riding high and we expect to see this run of form continue into the winter months. Innovative fit-outs incorporating comfortable surroundings with a wider selection of craft beers and cocktails together with a quality food offering is driving this resurgence, particularly within London and larger towns around the UK.”

Jarrod Castle, leisure analyst at UBS European Leisure Research, observed: “Growth continues to be stronger inside the M25 compared to the regions. This is inline with the trends we saw over the summer. The 12 month moving average of LFL growth is still under 0.6%, and this continued lacklustre performance is in contrast to the improvement in PMI data and both consumer and business confidence indices we have seen since the end of 2012. Comparables are easier next month, so we may see slightly better figures for October.”

The Coffer Peach Tracker* industry sales monitor for the UK pub and restaurant sector collects and analyses monthly performance data from 27 operating groups, and is recognised as the established industry benchmark.

About Coffer Peach Business Tracker
Peach Factory collects sales figures directly 27 leading companies. Participants include Mitchells & Butlers (owner of Harvester, Toby, Browns, All Bar One etc), Pizza Hut, Whitbread (Beefeater, Brewers Fayre, Table Table), Gondola (PizzaExpress, Zizzi, ASK, Byron), Spirit Group (Chef & Brewer, Fayre & Square),
TGI Fridays, Tragus (Café Rouge, Bella Italia, Strada), Stonegate (Slug & Lettuce, Yates’), Marston’s, Orchid Pub Co, Wagamama, YO! Sushi, Novus (Tiger Tiger),
Fuller’s, Bramwell Pub Co, Carluccio’s, Young’s, Living Ventures, Amber Taverns, Hall & Woodhouse, Gaucho, Las Iguanas, Intertain, Tattershall Castle Group, La
Tasca, Giraffe and Le Bistrot Pierre.

Coffer Peach Business Tracker is powered by Demographix