Upham Group finance director Robb Harris has told MCA the company will still target a doubling in size within three years following its delayed IPO.
Harris said the flotation plans had been put back because of a mixture of uncertainty over the EU referendum and fragile consumer confidence.
He said the group was not expecting to make any acquisitions until the floatation was complete –which he still hopes will be in the third quarter of this year – but said post-IPO the plan was to grow at five to six sites a year before re-assessing the growth strategy once the 30-site milestone has been reached.
Harris said trading in the first quarter of Upham’s financial year had been strong with like-for-like sales up c4%.
He said: “Our thinking now is that we will complete the IPO process the other side of the referendum. We initially thought we’d be far enough ahead that we wouldn’t be impacted. But from the institutional investors, now isn’t necessarily the time they want to go ahead with something like this. There’s also a bit of consumer sentiment – not necessarily something we’re seeing ourselves but a wider feeling in the market. We’re a very different operation to The Restaurant Groups of this world but there’s still enough common ground that we will pay attention to what’s happening with them.
“All the feedback we had in terms of the operations strategy and the management team was overwhelming positive so we’re in a good position when we re-start the process.”
On acquisitions, Harris said: “There probably won’t be any further acquisitions ahead of the completion of this process. We acquired in January – the Hawk – and we have development opportunities throughout the estate. We just extended the Peat’s Spade, adding in a kitchen that is fit for purpose and a manager’s flat. We upgraded the bedrooms at a couple of sites and we still have the Inn on the Hill in Haslemere, which will complete September / October time.
“In the medium-term we’re looking to acquire five to six sites a year to get us to 30. We’re confident we can do that from our existing base and then take a view from there. We’re looking to double the estate within two and a half to three years.
“They will remain, individual food-led sites. Predominantly we are looking at rural locations but we wouldn’t rule out market towns if it is the right one for us. The intention is that it will all remain freehold.”
