Trade holds up despite attacks
Companies boosted by strong sector performance
Leisure groups are standing defiant in the face of terrorist attacks and curbed travel. Companies within the sector are reporting better-than-expected sales and the City has taken note - the past two weeks have seen a stock re-rating of many clubs and bars.
Most notably, Luminar, the late-night club and bar operator which runs 275 venues around the UK (including London's Hippodrome, pictured), has seen its profits soar 123 per cent to £29.5m in the past six months, on sales of £166.4m.
"After September 11 there was a real fear that people would simply not go out. Clearly this has not been the case and it would seem the analytical beasts are finally waking up to the fact," said an industry observer.
Luminar chief executive Stephen Thomas said the group had noticed the impact of terrorism on trading for just two days after the September 11 attacks - overall he felt people were getting out more as a result.
"The atmosphere in the clubs is definitely different," he said. "People seem determined to get out and have a good time."
It has opened 31 venues in its first half to August 26. It will press ahead with expansion and spend £60m opening a total of 41 outlets this year.
Analysts at WestLB Panmure moved recommendations up on stocks within the sector just a week after the attacks in America, sensing the over-blown fall in share prices.
"The late-night market is as strong as ever," said WestLB analyst Douglas Jack. "The sector is not as dependent on tourism as people first thought.
Entertainment bar groups such as Regent Inns are also doing better than ever.
"We are very keen on this sector. Companies like Luminar are very strongly placed - for them, it is a win-win situation."
Other companies such as Po Na Na and SFI Group have enjoyed strong institutional support. Rank Group, owner of Hard Rock Café has also reported improved sales.
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Luminar lifts profits 123 per cent (14 November 2001)
