Globe: rent concessions up, drinks down
The number of tenanted pubs within the 425-strong securitised Globe Pub Company receiving rent concessions in its latest financial quarter more than doubled to 30.
The rent concessions given to an additional 17 pubs reflected "testing market conditions". Globe, which is owned by Robert Tchenguiz and managed by Scottish & Newcastle Pub Enterprises, saw its rent roll decrease by £500,000 to £13.3m.
Year-on-year drink revenue for "the core estate" is down 6.5% on the quarter and 6.5% for the year to date, which Globe said is a "reflection of further decline in consumer confidence in recent months".
The number of substantive leases in the estate has fallen from 307 in the previous quarter to 288 in the most recent quarter, the majority due to vacant possession being required due to disposal.
The number of closed pubs rose from 12 in the previous quarter to 18. Globe has 20 pubs on the market aiming to generate a £8m profit. Four pubs were sold for a total of £3.6m in the most recent quarter to the end of August, producing net proceeds of £1.3m after allowing for allocated debt.
Contracts have been exchanged on two more pubs which should produce a further £2.7m. Globe is using cash from disposals to buy additional pubs — 10 good quality pubs have been identified and the purchase is expected to completed before the end of 2008.
A report by Globe said: "We continue to focus our marketing activity into occasions that can increase footfall through Globe pubs. Examples of this include pub poker, which is working very well.
"Cider sales continue to show growth driving underlying sales mix and profitability. "Consumer demand for packaged cider over ice continues to grow (despite poor weather conditions) and we now have a range of packaged cider brands in wide distribution in order to allow Globe lessees to make the most of this trading opportunity."
