Chain restaurants continue to boom with positive sales results

15th September 2010, 11:04am

Leading restaurant and pub groups had a consistently good summer, reporting combined like-for-like sales for August up +1.5% on the same month last year.

This follows a +1.9% increase in July and 1.4% like-for-like growth in June.

The figures come from the Coffer Peach Business Tracker. Total sales, which include those from new openings, were ahead +2.9% on August 2009.

The August result also compares favourably with a 0.8% increase in like-for-likes in the same month in 2009.

The monthly Tracker figures are produced by Peach Factory in partnership with KPMG, UBS and the Coffer Group and monitor performance across 17 leading pub and restaurant operators. Companies taking part in the survey include Mitchells & Butlers, Whitbread, Pizza Hut, Punch Pub Co, Gondola and Tragus.

"These latest figures suggest some stability as well as growth in the market, which is particularly benefiting the bigger and branded players," said Peach Factory's Peter Martin.

"This trend is also reflected in our Peach BrandTrack consumer research, which shows a steady move by the public towards branded eating-out chains, both in terms of consumer awareness and usage."

Richard Hathaway, head of Travel, Leisure and Tourism at KPMG commented: "The performance of the brands featured in the Tracker remains solid, particularly in light of the relatively volatile trading that other smaller operators are seeing in the market at present. Like-for-like sales compared with last year remain good, although there was a sizeable fall in sales compared with last month."

Month-on-month sales in August were down -16.1% on July. Hathaway added: "This could be due in part to the end of the World Cup, coupled with poorer weather conditions. If so, this may sound alarm bells for autumn sales if poorer weather conditions take hold."

Mark Sheehan, managing director of Coffer Corporate Leisure, part of the Coffer Group, observed: "The clutch of recent M&A activity demonstrates that savvy investors believe the sector offers opportunity. These figures for August are strong although we expect some tough months during the coming quarters."

Jonathan Leinster, head of European leisure and tobacco research, at UBS Investment Bank, said: "We think August like-for-like sales should be taken positively. We expect that when new menus are introduced this and next month, operators will engineer their food offering to incorporate price rises. This will be done to anticipate the January VAT rise, at least in the food mix of the businesses.

"Companies are expressing caution over consumer spending in advance of the October spending budget. Since we expect public sector spending cuts to be phased over four years and to occur while the private sector is experiencing a modest recovery, we do not share the companies' caution, at least over this matter.

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