Trade flows in for Brulines
The use of flow-monitoring kit is one way to help reverse the decline in beer volumes, says The PMA Team
With beer volumes in steep decline, it's no coincidence that beer flow-monitoring company Brulines is doing particularly well as a result.
In March 2003, just 7,000 tenanted pubs in the UK had Brulines equipment installed in their cellars.
Even in March 2005, the figure for Brulines kit installations across the pub sector stood at a mere 10,500.
At the moment, numbers stand at 21,700, boosted for Brulines by the incorporation of 2,500 Nucleus Data kits in the wake of the deal to buy its smaller rival.
A total of 40 different pub operators now use Brulines cellar monitoring.
Brulines boss James Dickson estimates there are a further 6,500 tenanted pubs within its customer base it could add, with a further 4,000 tenanted pubs outside its existing customer base.
The traditional reason for Brulines installation has been to keep tenants straight — pub owners are promised a volume uplift of around 7% after installations occur.
Rather late on the scene are 16 regional brewers — now dominating the new customer list — who have tended to take a more trusting view of their tenants. In tough times, the temptation to buy-out is increased. But Brulines equipment holds one more key benefit.
It offers the chance to check on the quality of beer, which, let's face it, has been far too variable for far too long.
If the downward spiral of beer decline is to be reversed (lower sales in the case of cask ale, in particular, make the chance of producing a decent pint consistently that bit harder) this new technology has to be embraced.
Brulines kit is a line of sight into beer volumes and beer quality — aspects that can be used beneficially by both tenants and pub owners.
Shareholders caught napping
The Sunday Telegraph has reported that unnamed shareholders are threatening to get rid of Mitchells & Butlers (M&B) chief executive Tim Clarke if he doesn't pull his finger out and "monetise the property value" within the estate.
It was a bit baffling. It was as if the unnamed shareholders had awoken from a year-long deep sleep and not yet been briefed on what they'd missed. The remarks smacked of a degree of desperation from people on the wrong side of share movements.
M&B's disastrous £400m pre-tax hedge losses stem from best efforts to do a property deal at the behest of those wanting to see one done.
In the meantime, the debt markets have changed beyond recognition. Given the collapse of the Punch and Mitchells & Butlers courtship, the only strategy avenue open now seems to be fairly traditional — buy, sell or swap some pub assets and otherwise seek to outperform the market by sticking to the knitting.
Some M&B shareholders like Robert Tchenguiz have been pushing very, very hard for a racy re-ordering of the M&B universe.
The simple truth now is that M&B is left with little option but to try to create more value for its shareholders by running its pubs better — very largely the story at M&B since demerger.
For many, including smaller shareholders utterly dismayed at management attempts to run a hedge fund, it will be a case of thank God for that.
Site dumping is spot on
KBC Peel Hunt analyst Paul Hickman was approving of Luminar ridding itself of troublesome sites — and reversion possibilities at sites already sold.
A note last Thursday stated: "We are impressed by the quality of Luminar's strategic and financial management. The process of separating out the smaller and non-core units is now complete, and recent market concerns over potential reversions have been addressed by strategy that was already in motion.
"We believe this is evidence of management that, as well as undoubted operating expertise, has a thorough grasp of the strategic implications of its re-orientation to much larger, branded and highly-invested facilities."
He's right is Mr Hickman — it's just about the most adroit, imaginative and canny bit of site-dumping I can think of. Robert Tchenguiz, eat your heart out.
Morrissey is on the money
Actor Neil Morrissey is taking on a pub, Ye Olde Punch Bowl inn in Marton cum Grafton, North Yorkshire, with chef Richard Fox.
He talks a lot of sense about the pub. "Pubs are pubs, selling seasonal British food and British beers.
"They are emphatically not fake French bistros. Put an independent young couple in charge of a freehouse, give them some incentives, and they are away — it's a 24/7 business, and those who are in it for the love of it are there to win. And they will." Too right.
