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UK Leisure Sector - Q2 2018

18 July 2018Quarterly Updates Topics: Agency, Finance, Hotels & Guest Houses
UK Leisure Sector - Q2 2018

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- Q2 2018

Summary

In the restaurant market Carluccio's CVA has been agreed and one is being considered for Gaucho's brand CAU. However, there has been positive news with Caprice Holdings announcing increased annual turnover by £18.5m to £67.1m and Various Eateries reporting an increase of 6.6% in like-for-like sales (in the second quarter to March) across their brands such as Strada and Coppa Club. Pizza Hut UK has now been sold to its management team led by Jens Homa, in a deal reported at £100m, funded with Pricoa Capital Group.

There has been an increase in activity within the leisure resort market. Landal Green Parks opened a fourth site in the Peak District and Leisure Resorts are creating a new development in the Yorkshire Dales investing £12m. Lakeland Leisure Estates has acquired a 56 acre marina in Essex, indicating an expected further demand in the staycation market.

The gym sector seems to also be thriving with Pure Gym growing EBITDA to £101m (£64m in 2016) and Xercise4Less planning a further 10 sites this year.

Due to the royal wedding of Prince Harry and Megan Markle, Star Pubs & Bars predicted a further 50m pints would be sold on the 19th May, combined with the approval of the extended trading hours for pubs.

Large pub companies are now looking at refurbishing sites with both Mitchells & Butlers and EiGroup reporting an increase in allocated investment.

Mitchells & Butlers has stated they have spent £51m on 181 sites this year and Ei Group have said that they plan to invest a further £80m this year. Heineken also added they plan to double the investment in their UK pub estate at £44m.

A strong Easter trade in the pub sector, but a decline in March due to the weather and snowy period saw sales down 3.1% across managed pubs and restaurant groups. Heineken also reported a decrease in volumes in the UK. Marston's commented on this being a reason for the decline in their trading figures. However, the BBPA has estimated that the alcohol industry will gain £400m during the World Cup. It almost came home!

 

UK Leisure Sector Q2 2018 Highlights

April 2018 -

Restaurants: Richard Caring's Caprice Holdings has reported an increase of £18.5m in turnover, increasing to £67.1m.

Leisure: Jump Giants fourth trampoline park located in Gateshead was opened. The 40,000 sq ft site has a soft play area, dodgems and café.

Restaurants: Rutland Partners has sold Pizza Huts UK franchise to Jens Hofma. This has been backed by the private equity group Pricoa Capital Group. This deal is reported at £100m.

Pubs: City Pub Group report a sales increase to £37.4m, from £27.8m in 2016.

May 2018 -

Hotels: Travelodge reported a 6.2% increase in total revenue for the year end to Dec 2017, as well as a 2.9% increase in RevPar.

Leisure: Pure Gym has grown EBITDA to £101m in 2017 (£64m - 2016). Twenty new sites were opened and membership was up by 13%.

Leisure: Xercise4Less has acquisition plans for 10 new sites this year with an investment from Proventus Capital Partners of £42m.

Leisure: £100m will be invested in Newcastle with the 'The Whey Aye' project; the tallest observation wheel within Europe, creating approximately 550 jobs.

Pubs: JD Wetherspoon has reported a growth in like-for-like sales, up 5.2% on the year-to-date.

Pubs: BBPA has asked the Government to redefine 'low-strength' alcohol, differentiating from 'alcohol free'.

Pubs: Hawthorn Leisure has been acquired by New River for £106.8m. This will bring the total number of pubs to approximately 630, doubling the estate.

Hotels: According to STR, the London hotel market witnessed a 2% rise in demand in May, when compared with April, and a 0.9% increase in demand.

Pubs: Post half year results, Marstons' share prices dropped, and the company fell out of the FTSE 250.

June 2018 -

Pubs: Fuller's have now purchased the remaining 24% stake in the Stable brand, and now have 100% ownership.

Hotels: The Coaching Inn Group has acquired its 15th site, The Swan in Stafford from The Lewis Partnership, having been advised by Fleurets.

 

Contact Details:

Elysia Wilson-Gunn
Senior Associate
T: 020 7280 4747
M: 07810 541 579
E: elysia.wilson-gunn@fleurets.com

 

Graeme Bunn
Managing Director
T: 020 7280 4740
M: 07776 208085
E: graeme.bunn@fleurets.com

 

 

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Author

Elysia Wilson-Gunn

Elysia Wilson-Gunn

Senior Associate

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