Knight departs as Tye takes the reins at Spirit
Punch welcomes ex-Whitbread executive
Spirit boss Andrew Knight is to leave the business and is being replaced by former Whitbread executive Michael Tye. Knight's departure will be seen by some as a reflection of a degree of under-performance by Punch's managed division.
City analyst Geof Collyer, of Deutsche Bank, claimed in May that estate churn — including conversion of 650 sites to lease — seemed to have done nothing for the quality of the profits of the estate that remains.
Punch finance director Phil Dutton told journalists on Monday that he recognised that the performance of Spirit had "lagged behind its peer group in the last three to six months". Spirit's flagship food-led brand Chef & Brewer is rumoured to have had like-for-likes down 8% at one stage earlier this year, though they have improved since.
The departure of Knight comes as Punch endeavours to reassure investors about how robust its financial structure is. It brought forward a trading statement two weeks ago and held a teach-in for analysts on Monday.
Chief executive Giles Thorley told analysts that rent receipts would need to drop by 35% and 68% in its two tenanted pub securitisations and by 38% in Spirit for it to breach bank covenants.
Punch shares have fallen by around 80% in the past year, taking a further dip since May when they were worth above 600p — on Tuesday morning they were trading at 260p. The Financial Times said on Tuesday: "The market is in no mood to go near complex debt vehicles with a property element. But the abject fear of all things debt-related is starting to mirror the irrational enthusiasm during the boom."
Michael Tye, who is in his mid-50s, spent 16 years at Whitbread, occupying senior positions in each of the major divisions. He was marketing and commercial director for the pub-restaurants division and managing director for periods at Costa Coffee, Premier Travel Inn and David Lloyd Leisure. He has also worked for Aramark.
A statement by Punch stated: "Following the successful completion of the conversion of managed pubs to lease and the creation of a more streamlined managed business, we are today announcing that Andrew Knight, the managing director of Spirit, will be leaving the business.
"Andrew has been instrumental in delivering the Spirit business through a huge change programme reducing the division from more than 1,800 pubs at acquisition to 863 today.
"We are extremely grateful to Andrew for his excellent service to Spirit over many years and wish him all the best for his future career."
Chief executive Giles Thorley said: "I would like to take this opportunity to thank Andrew on behalf of the board for his commitment to the group in leading Spirit through a significant period of integration over the last couple of years as we continue to build the UK's premier pub company.
"I would also like to welcome Mike to the group.
"Mike has a long and diverse career in the leisure retail sector and brings with him exceptional experience which will be invaluable to the group in taking Spirit to the next stage of its development."
