In an interim results statement for the period between the group’s inception and 31 December 2020, Nightcap reported sound progress in building a property pipeline for its first acquisition, the 10-site strong London Cocktail Club – which it purchased for an initial £5.7m
The assessment comes despite the company being “essentially a cash shell” as its first acquisition did not complete until 13 January 2021 – the same day of its IPO on the AIM market of the London Stock Exchange.
According to its statement, the nascent group had £3.75m in cash as of 28 February 2021 and has a management team in place.
Best known for leading restaurant brands Planet Hollywood and Pizza Express – as well as her tenure on the thirteenth and fourteenth seasons of Dragons' Den – Nightcap chief executive officer Sarah Willingham predicted a strong showing for the hospitality sector in the latter half of the year.
“Our view for the future prospects of both the group and the London Cocktail Club business remains unchanged,” she explained.
“We believe that drinks-led hospitality will come back stronger than ever during the second half of 2021, helping us on our mission to be one of the UK’s leading bar groups.
“On the back of the UK Government’s successful vaccine programme and its roadmap to start reopening hospitality from mid-April onwards, the opportunities for Nightcap are enormous.”
Growth beyond London
According to its statement, Nightcap is in the process of building a pipeline of new sites in prime locations for London Cocktail Club both in and outside of its London heartland.
Founded in 2010 by Willingham alongside JJ Goodman, Raymond Blanc, David Moore and James Hopkins, London Cocktail Club has grown to 10 sites in London and Bristol.
The group is currently in negotiations on several new leases both inside and outside of the capital with ambitions to grow from its current 10 site stable to approximately 40 over the next five years.
“In line with our expectations, the damage done to the property and hospitality sectors by the pandemic is giving us access to new sites in prime locations with lower rents, increased incentives and lower capital costs per site than previously experienced,” Willingham continued.
“Given this, we are confident in our ability to provide even better returns on our capital employed than historically.
“Our mission and the reason for establishing Nightcap has not changed, “Willingham added. “We want to grow London Cocktail Club especially beyond London, and we need to find more great businesses with strong and motivated leadership teams, which perhaps now lack the capital to expand and release their growth potential.”
London Cocktail Club has also re-negotiated the majority of its leases, securing rent reductions for periods when its estate has been closed, as well as reducing future rent liability.
'Excited and confident'
While its venues are currently closed, five London Cocktail Club are earmarked to reopen on 12 April when guests can be served outdoors, with the remaining five are slated to reopen on 17 May, when indoor trading can resume as per the Government’s roadmap.
“We are really excited and confident about the future and cannot wait to get our existing sites back open and trading and feel sure that guests will embrace the opportunity to once more enjoy the London Cocktail Club experience,” Willingham said.
“With an experienced, driven team and 10 venues ready and waiting to once again serve the ‘millennial pound’, we look forward to delivering on our commitment to capitalise on this opportunity, which is enormous.”