Government needs to ‘stop dithering’ on pub sector guidance, says Hawthorn boss

18-Jun-2020 - Last updated on 18-Jun-2020 at 10:40 GMT

'Great disappointment': 'we are speaking to Government ministers and the Prime Minister's team direct on a daily basis – they're under no illusions about the importance of providing this guidance,' Hawthorn's Mark Davies explains

Hawthorn Leisure’s CEO Mark Davies has revealed that despite a lack of Government guidance on the safe reopening of pubs, three quarters (74%) of his company's tenants intend to press ahead with a 4 July restart.

Speaking to The Morning Advertiser (MA) after Hawthorn's parent company NewRiver announced its financial results for the year ending 31 March, Mark Davies, CEO of the real estate investment trust’s pub arm, lamented the lack of Government guidance on issues such as social distancing as pubs edge ever closer to resuming trade on 4 July after Covid-19 lockdown.

"The Government hasn't actually provided it's guidance yet, which is a great disappointment to the industry and quite frankly it needs to stop dithering and get that guidance into the market,” Davies - who sits on the board of the British Beer & Pub Association (BBPA) - told MA. “We're expecting that now to come through tomorrow (19 June).”

Yet despite the “dithering”, a survey of Hawthorn’s pub tenants revealed that 74% still intend to open on 4 July, with 22% awaiting to see the final Government guidelines before nailing their colours to the mast.

“It's great so many of our tenants are confident they intend to open on 4 July,” Davies explained. “We've got 22% who are waiting to see for that final guidance to come out - which we were all expecting earlier in the week. We expect that the majority of that 22% who currently remain undecided to open.”

Government under no illusions

The operator of 720 pubs as of 31 March 2020 – up from 665 at the same point in 2019 – revealed that until March 2020, Hawthorn delivered like-for-like earnings before interest, taxation, depreciation and amortisation (EBITDA) per pub growth of 5.9% during the year.

What’s more, the operator completed 82 capital investment projects across its pub portfolio at a cost of £4.3m during the past 12 months and has integrated both a portfolio of 44 wet-led community pubs acquired from Bravo Inns in December 2019 as well as a further package of 28 pubs from Marston’s purchased in January 2020.

However, despite progress in the past year, Davies explains that lack of clarity from the Government on issues such as social distancing has stifled planning for the Hawthorn’s bounce back from an enforced pub closure of what will be at least 106 days.

"Does two-metres make a difference versus one-metre? Absolutely it does. Not for all businesses, but for some it will. It's a big issue and the Government is clearly doing research right now on two-metres versus one-metre and no doubt the lack of clarity from Government is disappointing – it inhibits our planning. We were led to believe we would get at least three weeks’ notice on this - that period has now lapsed.”

Davies adds that he believes the work of the BBPA has left the Government and those close to the Prime Minister in little doubt about the importance of imminent guidance for the pub sector.

"We are doing everything we can,” he said. “We are speaking to Government ministers and the Prime Minister's team directly on a daily basis – they're under no illusions about the importance of providing this guidance and to do that quickly."