Punch returns to the acquisition trail
The Patron Capital-backed group has acquired the Royal George in Cardiff and the Unicorn in Loughborough, both from Stonegate.
Both will be traded in their current form for around six weeks before the former is converted to Mighty Local community pub template and the latter is rebranded as one of Punch’s Champs sports bars.
Punch currently operates 30 pubs under the Mighty Local model – 27 on retail contracts and the others under a leased and tenanted agreement. It plans to convert c12 more in the next few months, all under retail contracts. The Loughborough site will take the Champs estate to six – currently evenly split between leased and tenanted and retail contract but with plans to convert one more back to retail. Punch plans to open two more Champs over the next few months.
Punch chief executive Clive Chesser said: “We are really pleased to have acquired two fantastic pubs to operate under our retail concepts, providing further evidence of our aspirations for growth. We look forward to customers enjoying the investments once they are completed.
“This is an exciting time for Punch and we continue to search for additional high quality pubs to add to our estate.”
Patron Capital completed the acquisition of Punch last August as part of a joint deal which saw Heineken take on 1,900 pubs.
In May of this year, Vine Acquisitions, the vehicle which acquired Punch, took on the 54-strong Laine Pub Company estate.
Q&A with Punch chief executive Clive Chesser on the year so far…
What are you most proud of within your business so far this year?
Being so new to the business I can claim no credit, however the entire Punch team should feel hugely proud of how they have successfully managed through considerable change over the past year. They have dealt with all the uncertainty of a change of ownership, worked with the HUK business to transfer 1900 pubs with minimal disruption, whilst at the same time moving our distribution network over to Marston’s. In addition I would like to thank our publicans for dealing with the same changes in such a positive and supportive manner.
Is there anything you hoped to achieve that has so far been frustrated?
We are keen to further increase the level of capital investments with our publicans, and the team are now focused on accelerating an intensive programme of investment delivering genuinely transformational schemes for our publicans.
Is there anything you’ve been forced to react to that you never expected at the start of the year and/or has had a significant impact on business?
I think that every year throws up unexpected challenges but most recently we have all had to manage through the C02 issue. This created a real risk to our business at a time when the English weather and football team were both exceeding our expectations, but the Punch team dealt with these issues excellently and we had very minimal impact on our pubs.
Is there anyone in your business that you would like to highlight as having performed above and beyond expectations so far in 2018?
I would personally like to thank my CFO Steve Dando for holding the reins so professionally during his stint as Interim CEO.
What do you hope to achieve before the end of 2018?
We have many internal goals to achieve this year, but primarily ensuring that the Punch business is now set up to thrive in an exciting future full of opportunities.
Do you feel more or less optimistic about the sector now than you did at the start of the year?
The sector is facing significant headwinds with rising costs and the economic and political uncertainty caused by Brexit, however I remain confident that the public’s love for the Great British pub has not diminished and, when delivered at its best, is stronger than ever. We all know that well run businesses can still win market share and deliver outstanding growth.
When MPs return from their summer break what should they be discussing that would significantly support the sector?
As an industry we pay disproportionately high levels of tax when compared to others. I believe that MPs should be looking at ways to support us through Business Rates, Duty, VAT etc whilst recognising that the cumulative effect of all of these taxes makes it more challenging for us to continue to invest in local communities and to offer much needed employment opportunities to people of all ages.
If you could counter a common misconception in the media / consumer mindset about the sector, what would that be?
I think the industry is making great strides however we still need to work harder to portray a career in hospitality as being an aspirational career in a professional and dynamic environment.
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