Spirit soars as pubs benefit from the Tye
Looks like there could be life in the pub game yet. Today the Spirit Pub Company, recently demerged from struggling Punch Taverns, said that sales are soaring under the leadership of industry veteran Mike Tye.
Spirit consists of 800 pubs it manages itself and 550 which are leased to freelance landlords. Around 100 of the leased pubs will move in house over time.
At the managed arm, sales in the 16 weeks to December 10 are up 6.2%, driven partly by food sales, with concepts such as Flaming Grill proving popular. Tye said: "These are still pubs in the community, but it gives a real reason to visit.
They are still very much pubs, but the reason for going is primarily the fantastic food."
Tye says his aim is to make Spirit - which includes one of London's favourite boozers, the Chelsea Potter, among its properties - "the best pub company in the UK". He declined to say which he regards as the best at present.
Spirit has around £700 million of debt, which he hopes to get down to around four times profits. It is paying around 7% on the debt. Paul Hickman at Peel Hunt said: "After its first quarter of stand-alone trading, Spirit is living up to its claims - managed trading is strong, and disposals and conversions of the leased estate have started promisingly."
The message from Punch was less upbeat, with like-for-like sales down 1.5% at the "core estate" and a horrid 10.4% at the "non-core" estate, the part it hopes to sell or shut. Chief executive Roger Whiteside said: "Although the UK consumer environment is likely to remain challenging for at least the near-term, we have a clear operational plan to return the core estate to growth."
