Autumnal sun shines on managed pub operators

Leading pub and restaurant chains across the UK continue to perform better than this time last year, according to new research.

According to the Coffer Peach Business Tracker, year-on-year October saw like-for-like sales across a basket of leading managed operators including Punch Taverns' managed arm and Mitchells & Butlers (M&B) grow 2.2 per cent, with total sales up nearly four per cent.

However month-on-month sales continue to be subjected to the vagaries of the economy, with October's figures down more than 16 per cent on September's, which were themselves up 15 per cent on August.

But Peter Martin of Peach Factory, one of the business tracker's members, said the latest numbers were nevertheless "encouraging".

"They are evidence of a consistently good showing by the bigger operators. It will help fuel optimism for the run-up to Christmas.

"The public is still going out and the bigger, often branded, chains are keeping their customers coming through the door," he added.

Another member of the tracker unit warned that large operators needed the sort of numbers being seen now in advance of January's VAT increase.

"In some respects, the managed sector needs good sales growth now to deal with the difficulty of another VAT rise and rising food inflation," said Jonathan Leinster, head of European leisure and tobacco research at UBS Investment Bank.

"As autumn menus were introduced in 2009, many operators increased prices ahead of the January 2010 VAT rise. A 2.2 per cent like-for-like figure this year against +2.8% in October 2009 should be viewed as a very strong result. This bodes well for customer acceptance of higher menu prices again this autumn.

"The VAT rise in January 2010 represents a 2.1 per cent price rise for consumers. Food and catering RPI has been rising since November 2009 and was up 4.3 per cent in September.

Leinster said the ongoing rate of like-for-like sales growth had been comfortably ahead of 2009 since the spring half-term holidays.