Member Article

Pubs and restaurants experience slow start to 2012

The UK’s pub and restaurant groups saw collective like-for-like sales fall in January, compared with the same month last year.

The Coffer Peach Business Tracker collected performance data from 23 major pub and restaurant groups, revealing a fall of 2.1%.

In contrast, collective like-for-like sales were up 9.9% in December on the same period last year.

Peter Martin of Peach Factory, who produce the Tracker in partnership with KPMG, UBS and the Coffer Group, commented the bumper December will make up for the lacklustre results.

He said: “Restaurant and pub operators are generally optimistic about prospects for their businesses this year.

“Despite all the economic difficulties of the past two years, the market has shown real resilience, with the public still willing to go out to eat and drink.

“Sales figures have been positive for the majority of that time. Also, sales in January last year benefited from a bounce-back in spending after a poor, snow-hit December, when many people stayed home.

“As ever, the weather, and in particular snow, is a major influence on trading, as we have already seen in the first week of this February.”

Participants in the study included the likes of Whitbread, who operate Beefeater, Brewers Fayre and Table Table outlets, and Gondola, who operate Pizza Express, Zizzi, Ask and Byron.

Chris Stott, KPMG’s North East food and drink sector specialist & Transaction Services partner, said: “The January figures reveal a relatively slow start to 2012 and the likely impact of the current cold weather means February will probably not look very different.

“Trading conditions remain tough and they are likely to be with us for a while. However, given the tough economic environment, low consumer confidence and the continuing squeeze on disposable incomes, the growth that has been achieved over the past 18 months is remarkable and shows just how resilient the UK’s eating and drinking out market is.”

Jonathan Leinster, Head of UBS European Leisure Research, added that the concerns over UK consumer spending were nothing new, and would likely linger.

He said: “Nevertheless, the operational performance of most pub groups has been relatively solid of late, with two-year growth last negative in May 2011.

“Despite rising unemployment, consumers are still happy to allocate discretionary spend to eating and drinking out.

“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 maintain ‘buy’ ratings on JD Wetherspoon, Marston’s and Greene King.”

This was posted in Bdaily's Members' News section by Tom Keighley .