Current chief executive officer (CEO) and founder Peter Borg-Neal will become executive chairman, current chief operating officer (COO) Dermot King will become CEO and Mike Smith will step down as chair but remain on the board as a non-executive board member.
Borg-Neal said: “Mike Smith has played a huge part in the success of Oakman Inns – as a major investor, an astute chairman and a as personal friend of mine. I am delighted he has agreed to remain on the board, and I would like to take this opportunity to publicly thank him for his guidance and support over so many years.
“Once we started to look for my successor back in 2018, we quickly landed on Dermot King as our first choice and was delighted when he accepted our offer to join as COO.
“He and I have a complementary skill set and over the past eighteen months we have formed a strong partnership. Going forward, King will take responsibility for day to day management of the business, driving efficiency and profitability whilst I shall devote more time to our development and growth.”
King said he was “honoured and delighted” to head up Oakman and believes the sky is the limit with what the business can do.
Deeply ambitious
He added: “Having spent the past 18 months working alongside Borg-Neal and the team I genuinely believe there is no limit to what we might achieve.
“We remain deeply ambitious for the company and as market leaders in the growing premium pub sub-sector, we believe that the opportunities ahead of us for this deeply talented team, are very exciting.”
Mike Smith said he informed Borg-Neal in 2018 that he intended to step down as chairman ahead of his 60th birthday in October of this year.
Smith added: “Having chaired the business since our first site opened in 2007, it has always seemed crystal clear to me that it was Peter’s destiny to become executive chairman of the business that he founded and has led so brilliantly over the years.
“Clearly, this could only be possible with a cogent succession plan and our initial conversations eventually led to the appointment of Dermot King as our COO in January 2019.
“King and Borg-Neal have since formed an outstanding working relationship and, despite the current challenges, all our stakeholders can look forward to the future with great confidence.”
The group also announced its trading update, including the impact of the coronavirus on results.
Future planning
Prior to the pandemic, Oakman saw like-for-like sales up 4.3% in the year to date and total sales rose by 14.3%.
However, the closure of the pubs in week 38 of the financial year has meant for the 52 weeks ending 30 June, sales of more than £31.5m represent a sale slump of 17.3% over the previous year.
Looking ahead, the business will be focusing on strengthening its balance sheet to ensure it can not only withstand any further shockwave but also be ready to grow through mergers and acquisitions and commercial property partnerships, Peter Borg-Neal said.
He added: “To deliver this equity funding, we are considering a number of options including attracting a strategic investor and holding a retail fundraising. We are therefore asking the Chancellor to urgently consider for the Autumn Budget the provision of investor tax breaks and the lifting of all restrictions on the Enterprise Investment Scheme for the rest of the financial year 2020/21.”
Upon reopening, Oakman has reported early trading success with like-for-like sales at 82% of last year’s over the 4 July weekend, and 104% across Monday 6 July and Tuesday 7 July.
The business stated it was experiencing higher operating costs due to the financial impact of Covid-safe compliance such as rising food prices and additional labour costs driven by operational complexities.
However, it is confident the VAT cut announced by the Chancellor on Wednesday 8 July will provide significant margin mitigation and the Eat out to Help Out scheme will help boost demand in August.
The majority of Oakman’s team members were furloughed and all but a few have now returned to work.