Shares of pubs may attract investors who predict the U.K. economy will grow more than forecast, as consumers keep hoisting pints.
Sales rose 2.1 percent in November at managed pubs and restaurants open at least 12 months, according to the Coffer Peach Business Tracker. This marks six consecutive months of so- called like-for-like increases at 24 major chains amid renewed concerns about a U.K. recession, said Peter Martin, chief executive officer at Peach Factory, which tracks the data with KPMG LLP, UBS AG and the London-based Coffer Group.
"The frequency of eating out has remained quite solid," said Martin, in Southport, England. "The pub industry has outperformed casual dining" as an "affordable treat."
The data -- a proxy for the industry -- cover pubs that are managed by operators such as Mitchells & Butlers Plc and Spirit Pub Co., Martin said. December figures, due later this month, probably will reflect continued increases, as value-minded consumers choose pub fare in lieu of more expensive meals, he predicted, adding that bad weather in December 2010 also may help the comparison.
Even as sales remain positive, the newly-created Bloomberg U.K. Pub Index -- which includes Greene King Plc and Mitchells & Butlers -- has fallen 25 percent since Dec. 31, 2010, while the FTSE 350 Index is down 6 percent. That's because investors have focused on "capital preservation," shunning companies -- including pubs -- that are highly leveraged, said Robert Griffiths, a London-based pan-European equity strategist at Royal Bank of Scotland Group Plc.
6 Jan 2012
Resilient Pubs May Appeal to Investors More Optimistic on U.K.
2 Dec 2011
Marston’s launches drive to open more pubs - Business News - Yorkshire Post
PUB chain Marston’s is to open another 25 pubs next year as cash-strapped customers trade down from restaurant dining to a meal at their local pub.
The new outlets, which will include three in Yorkshire with one site confirmed in Cleckheaton, will create 1,000 jobs over the next year including around 100 in the Yorkshire area.
The company, which has around 200 pubs currently in Yorkshire, operates under the Pitcher & Piano and Tavern Table brands.
The trend away from restaurant to pub dining helped Marston’s full-year profit come in at the upper end of expectations.
Chief executive Ralph Findlay said customers are looking for “affordable treats”.
“The focus we’ve had on value has been one which we think is utterly crucial in this market,” he said.
“If you break out what consumers are spending on eating out, pubs are doing better than restaurants.”
Marston’s has introduced a number of offers such as two main meals for £10 and a curry with a drink for £4.95 as it looks to pull in diners.
The group reported strong food sales in Yorkshire and cited the Yorkshire Rose in Huddersfield as one of its best performing pubs in the region.
22 Nov 2011
UK Pubs For Sale - Freehold Pubs For Sale: Ipswich Brewery Tap pub issues own bonds to raise money
Ipswich Brewery Tap pub issues own bonds to raise money
A pub in Ipswich is to issue its own bonds after failing to get bank loans, reports BBC Suffolk.The Brewery Tap, on the waterfront, will sell the £500 bonds to customers, who will get a 10% discount on food and drink in return.
Mike Keen, landlord, said: "We would consider putting the pub on the market if we can't raise this money."
Peter Herd, an independent financial adviser, said any investors would have to consider the possibility they could lose their money.
Cable thieves
The landlord said he hoped to raise £20,000 and claimed he would start repaying bond holders their £500 from June 2012.The pub said the bonds were effectively loans made to them by customers, who would get a financial return in the form of the 10% discount rather than as interest.
Mr Keen said the pub had broken even in October, but they had to improve cash flow.
He said they had lost money last year when thieves stole cabling from the derelict former Tolly Cobbold Brewery nextdoor, which meant the pub had to use an electricity generator for two months.
The landlord who took over the pub two years ago, said: "You hear the government banging on about how they're pressurising the banks to loan to small businesses to kick-start the economy, and it's just not working.
"Customers have said 'if you want a loan or anything let's do it', so now we've structured it into a proper deal.
1 Sept 2011
UK Pub Sales News: Hotels present good investment opportunities
ndividuals wanting to invest in hotels for sale might be interested in comments made by IPINGlobal.com.
Researcher Peter Mindenhall noted: "The hotel industry has reported strong growth in recent months; the major hotel chains are expanding.
"As a result, much of their development is now being funded by private equity rather than by the banks - presenting opportunities for private investors to capitalise in areas where the banks are no longer prepared to."
Student accommodation in London is another area of the property market currently presenting opportunities.
"Where traditionally houses would be converted to accommodate students near universities, this is becoming less cost effective when compared to the value and quality that a managed new development can offer," Mr Mindenhall added.
Steve Oliver of Paramount Investments said he agreed with the findings.
"Boutique hotels are in demand as are the cheaper budget hotels. Travelodge and Premier Inn are continuing with their expansion," he noted.
His remarks came after research from Jones Lang LaSalle found that hotel investment volumes in Europe, the Middle East and Africa reached £2.97 billion in the first six months of this year, up 73 per cent from the same time in 2010.
