Brighton Pier Group, the parent company of Eclectic Bars Group, has updated on its strategy to rationalise its bar group and integrate the two sides of the business.
The Luke Johnson-chaired group has sold off a swathe of its Lola Lo sites and developed the offer on the pier over the six months to the end of 2016.
The group’s review of its bars division is focussed on reducing operating costs, improving gross margins, reviewing the potential disposal of marginal and unprofitable sites (where the opportunity arises), and the launch of ‘Smash’, a new venue within the group’s Reading Sakura venue. The gross margin in the division has improved by 80 basis points against the same period last year.
Six sites have been disposed of since June 2016 – Sheffield, Brighton Dirty Blonde and Lola Lo sites in Brighton, Lincoln, Edinburgh and Oxford.
The ping pong, craft beer and pizza concept, Smash, has “continued to trade ahead of management expectations” since it opened last May and the group said it was “actively looking at other potential rebrands of locations within our estate”.
Other areas of development include the installation of new EPOS and a revamp of the Eclectic website.
At the end of January 2017, Manchester Lola Lo underwent an upgrade to develop and modernise its offering, with the addition of media screens, a dedicated ‘Master Class’ bar and changed seating areas. A similar upgrade is planned for Cambridge Lola Lo in the coming months.
Sales revenue for the group was up 65% to £17.74m (2015: £10.72m) for the half year to 25 December 2016, which included, for the first time the benefit of the busy summer period on the Pier.
Group gross margin during the period has increased by 350 basis points and group EBITDA before highlighted items was up 266% at £3.51m. Profits before tax and highlighted items were up 783% at £2.65m.
The group said trading at Brighton’s Palace Pier was in line with expectations and that integration into the wider group had been completed much quicker than expected.
The group said that the success of a soft play trial last year had given it confidence to launch the largest soft play area in Brighton, with the creation of a new ‘Palace Play’ in the Dome, totalling 231m2 with a capacity for 140 children. There will also be a new café in the Dome. A new take-away fish and chip shop was also opened last year.
The group is also looking to increase capacity at its Palm Court restaurant and in Victoria’s Bar, both inside and outside and developing its Horatio’s Bar, “utilising the broader group’s expertise of bar management”.
Johnson said: “This has been a transformational period for the Group.
“The acquisition of Brighton Palace Pier has delivered a strong financial performance for the Group with its first summer trading period in this half year set of results. I believe there are exciting opportunities to further develop the Pier business over the coming years. We continue to make good progress rationalising the Bars division together with driving operational and financial improvements across the estate.
“We expect trading to continue to be in-line with market expectations through the seasonally quieter second half as management executes the Group’s strategy.
“Our ambition is to become a leading experiential attractions business in the UK. I believe we now have the correct group structure and appropriate management team to deliver that ambition.”
