Big restaurant groups biting back against downturn

17th August 2009, 9:08am

Britain’s leading restaurant and pub operators are trading positively – despite fears of a drop-off in out-of-home consumer spending.

Latest aggregated figures for July from the Coffer Peach Business Tracker show that like-for-like sales among the sample of 13 major chains were up 1.0% against the same period last year.

The new figures continue a trend seen in the previous two months, when like-for-likes grew 0.6% and 0.4% in May and June respectively.

The aggregated July results are:

Like-for-like sales change (against same month last year): +1.0%
Total year-on-year sales change: +4.6%
Monthly sales change (against June, 2009): +5.9%

Peter Martin explains more about the figures: "The July results also confirm the continuing trend for bigger players to outperform independent operators and to gain market share, with total sales up 4.6% against 2008. Their focus on improved marketing, promotions and delivering value is having an undoubted impact on the top-line."

"Although this will be putting pressure on margins, it may well be the future for the market and operators will have to get used to working in a lower-margin environment for the long-term."

July also saw a 5.9% increase in month-on-month sales against June, but said Jonathan Leinster, head of European leisure and tobacco research, at UBS Investment Bank: "It is normal for sales in July to be 4-6% ahead of June sales."

He added that the July increase in like-for-likes could have been influenced by the larger number of people staying within the UK during the traditional Summer holiday period.

"Generally managed pubs companies has reported positive LFL sales since February, though performances have varied depending on the level and timing of promotions. The improvement in July appears to show that this trend will continue over the summer."

Will Hawkley of KPMG, commented: ‬‪"The results confirm that trading at the leading restaurant and pub groups is holding up well during the downturn. However operators will have to keep their focus on cash flow and driving down costs whilst continuing to generate innovative promotional campaigns. We will have to wait and see what effect rising unemployment and an increase in swine flu rates has on the sector as we approach the winter months."

Related Articles:

• 15 Sep 2011 - Eating out survives impact of August riots, finds research
• 19 Jul 2011 - Like-for-likes sales up 3.9% in eating and drinking out market
• 14 Feb 2011 - UK pub and restaurant chains see like-for-like sales rise 10.7% in January
• 13 Dec 2010 - Pubs and restaurants experience slow growth in November
• 16 Nov 2010 - Chain restaurants continue to grow in sales
• 18 May 2010 - Restaurant and pub groups see sales rise in April
• 14 Dec 2009 - Sales growth across pub and restaurant groups drop in November
• 16 Nov 2009 - Leading restaurant groups see sales rise by 2.8% in October

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