14/02/2023 10:27:00
Morning Advertiser advises that the hospitality sector is suffering despite official figures showing the UK narrowly avoided falling into recession in 2022, the Night Time Industries Association (NTIA) has stated. The economy saw zero growth between October and December with hospitality recording falls of 0.01 percentage points in both the third and fourth quarters of last year, according to the Office for National Statistics (ONS).
Specialist hotel lender Leumi UK has signed a £13.8m refinancing loan for Formby Hall Golf Resort & Spa in Liverpool. The deal, which is to last five years, was agreed by global private equity firm H.I.G Capital and hotel manager Hamilton Pyramid Europe, reports The Caterer. The four-star hotel currently has 76 bedrooms and is seeking to expand its room, spa, gym, and treatment offering. Leumi UK predicted that the property will benefit from international visitors making the most of a weak pound, as well as domestic staycationers looking to save during the cost-of-living crisis.
Pub and bar company insolvencies have increased 83% in the past year (December 31 year end), from 280 in 2020/21, to 512, according to figures from accountancy group UHY Hacker Young. Energy prices have soared and hit pub companies' wallets hard throughout the winter after the government removed support for businesses' energy bills. The cost-of-living crisis, including interest rate rises, has impacted consumer habits, making them less likely to spend on non-essentials, including a drink or a meal at a pub. At the same time, inflation has pushed up the prices that pubs need to pay for beer and food. Following a difficult pandemic period, many pub and bar companies have very little by way of savings or capacity to borrow more. For some pub company owners, the current economic downturn has been the final push into insolvency, reports Hospitality & Catering News.
JD Wetherspoon's sales have not yet recovered to pre-pandemic levels. Like-for-like sales in the 25 weeks to January 22 were down by 1 per cent against the last equivalent pre-Covid period. The decline worsened in the latter part of this period, down 2 per cent over the last 12 weeks. This compares poorly to peers such as Mitchells & Butlers. A key issue is JD Wetherspoon's customer base, which is particularly vulnerable to cost-of-living pressures, advises the Financial Times. HSBC analysts said the company "is exposed to weak demographics: older age groups and lower incomes". They added that customers are being lost to supermarkets and home drinking, despite the company potentially benefiting from punters trading down from more expensive establishments. The shares have been on the up this year, though they have shed over 40 per cent of their value over the past 12 months. Martin seems to think they will continue to climb. He bought 2.6mn shares on February 1 at 457p a share.
Young's has announced the opening of The Bishop's Vaults, a new wine bar in the heart of the City of London, advises Pub & Bar. The Bishop's Vaults joins Young's 226-strong portfolio of pubs, bars and hotels.