City Diary — 18 February

Nice pubs if you can get them…​

The payment of dividends has tended to be a victim of tough times in the pub sector. Good to see some companies doing well enough to pay them, though. Trust Inns, the tenanted operator owned by leisure magnate Trevor Hemmings, paid a mighty £41.24m dividend last year, according to Companies House documents. The company made a pre-tax profit of £5.96m on a turnover of £42.4m in the year to 31 March 2009. The year before saw a loss of £11.4m after an writedown of £25m in property values.

RPI rent increase on the cards​

The Bank of England warns inflation will rise above 3% in coming weeks. The sector's sharpest critic of RPI-linked annual rent increases, Orange Sun Bars boss Paul Wigham steps up to the plate once again: "That means we are about to suffer RPI rent increases in the worst economic crisis for decades and a disastrous market for pubs, which close at 39-52 per week depending on who you believe. On-trade decline last year? A 6% to 8% decline, perhaps? And, therefore, logic dictates that rents go up? I appreciate that the pubco landlords may get sensible this year, but it does underline the folly of it."

Bilimoria rejoins interview circuit​

Cobra founder Lord Bilimoria, pictured, has returned to the interview circuit after his company crashed and burned last year leaving creditors £71m out of pocket. He still owns 49% of the brand, which sells 200,000 barrels a year, in a partnership with Molson Coors. He's still promising to pay back uninsured creditors out of profits from the new company. "The proof of it will be what I do when I do it. It may take me many years, but I'm going to try." Industry sources suggests Bilimoria's share of profits at Cobra may be in the region of several hundred thousand pounds a year. Even so, decades rather than years might be a more realistic timescale.

Sam Smith's back on snack in Feb​

Bit of a kerfuffle over at Samuel Smith's over the plan to replace McCoys with own-brand crisps and nuts. Reports indicate that managers were instructed to run-down old stocks by mid January, with new stock available by the end of January. But there seem to be unspecified problems and the projected first delivery date will be 22 February. "Some pubs will be without crisps for the best part of a month," huffs one poster on the Sam Smith's website dedicated to moaning about the company.

Humphrey keen on 5% surplus​

Unconfirmed reports also indicate that brewery boss Humphrey Smith has taken over as area manager for a number of the company's pubs in the London area. Naturally enough, he is encouraging managers to comply with the 5% stock surplus the company likes to see on its draught products. It's a bit harder in the south where customers tend to like a headless pint, isn't it?

Diageo gives the Swiss a miss​

Hats off to Diageo for resisting the blandishments of the sneaky Swiss. The company was approached by the Swiss — who have managed to keep out of all the major dust-ups in Europe thanks to their willingness to tuck your money away with no questions asked — and offered a sweetheart deal to relocate. The juicy offer to move its headquarters to the canton of Zug would see Diageo's top 200 executives exempt from paying income tax, and the company itself offered corporate tax rates on more attractive terms than those in Britain. Diageo politely declined. Maybe the prospect of endless cheese fondues and horse steaks focused Diageo's thinking on this.

Martin to turn tables in 2010​

In April 2008, the Morning Advertiser reported that Wetherspoon founder Tim Martin had decided to spend £4m a year on extra staff hours to ensure tables are cleared in the wake of complaints. The extra spend worked out at an additional 20 hours staffing per week per pub. Almost two years on, how's it going? A reader tells Martin, in the latest Wetherspoon News, that table cleanliness varies from "squeaky clean" to "sticky and unpleasant". Martin says: "I agree that tables should be cleaned properly and frequently — and will make this my main task for 2010."

Taybarns' bumper wedding deal​

Value offers are pulling in the punters, as we know. Whitbread's all-you-can-eat concept Taybarns is offering an irresistible wedding deal — complete with an orange wedding cake. For £600, couples will be able to tie the knot and invite 50 guests to help themselves at the 34m buffet. The couple will also get a bridal bouquet and honeymoon suite at a Premier Inn next door.

Fill your boots in Fulham​

Marston's clear out of bottom end Pitcher & Pianos continues. The one off Trafalgar Square is on the blocks and the site in Fulham is also being marketed. A property expert tells City Diary: "Ignore the £50,000 premium — you'll get paid to go in, with indications of a reverse premium of £50,000 to £100,000. Rent in this case is on the high side at £90,000 and rateable value a bit silly at £102,000, but should have been appealed — can't see any reason that £90,000 isn't possible. Someone rated it as a pub for some reason and got stuffed." Any takers?