M&C Report talks to Patisserie Holdings chairman Luke Johnson and chief executive Paul May on the back of the Patisserie Valerie (PV) operator’s full-year results about trading, its pipeline, property, acquisition opportunities and its link up with Next.


Johnson said: “Trading is solid, it is all about delivering on the expectations when we took it public in May, so far so good.” May said: “We haven’t seen a particular spike in trading in a certain area, we have been quite fortunate that where we open the trading has been quite strong. We haven’t opened too many in London, which is down to competition and price, so the focus has been on outside the capital.”

The company had said it intends to start paying dividends for the current financial year.


The company operated 148 stores at end of year (2013:108) made up of new openings and its £6.3m acquisition of Philpott’s. It plans to open a further 20 sites in its current financial year.

Johnson said: “PV will make up virtually all of the 20 sites we plan to open in the coming year. We might open the odd one Baker & Spice and possibly Philpott.s, we won’t be opening in anymore Druckers, it is simply not a profitable enough format.”

May said: “We have had Philpott’s for just over six months, so we have been introducing what we know from PV into that estate, but there are still some learnings for us for the main group and they are still coming through.

“Druckers will not disappear, it is a well-established brand in the Black Country. I think there will be the odd one that we convert, and I think we will do one this year. With Philpott’s at the moment we are concentrating on the synergies, especially around buying. We are still understanding the brand and what we want to do with it, there is potential for growth but we haven’t got anything planned at this moment in time.”


Johnson said: “It is incredibly difficult in London. The incredible inflation and rental rates in the capital and the knock on effect on rates are prohibitive to opening further sites. We did just open in Wimbledon a few weeks ago, we managed to find a pretty attractively rented site and it is doing well, but the substantial majority of our growth will be outside London for the foreseeable future. That is where the demand is, there is also less competition and the rents are affordable.

“The really overheated element is A3, that’s where the big premiums are and what I would consider to be silly rents for new sites. We don’t see too much of that. That might possibly curtail the opening of more sites under the Brasserie format. However, we tend to open them on an opportunistic basis, where we come across a special situation in terms of the site.

“From the beginning we have tried to structure a low risk model with a relatively low average spend and relatively low fixed cost. One of the advantage we have going forward is that where we are not going to see cripplingly rent increases on much of our estate because we don’t have a very strong bias towards London and the South East.”

May said: “We will definitely open another Brasserie this year, but too early to say where as yet.”


May said: “There is an appetite for acquisitions, there isn’t anything at the moment, but if anything came a long we would look.”

Johnson: We get offered stuff from time to time, if it fits, if it is good value, if we can manage it and we can see a way to grow it, if its fundamentally a profitable business, or we can turn it around, or efficiencies we can bring through central cost savings and stuff like that, we would take it seriously. It is all opportunistic. We don’t go knocking on doors people bring us stuff. There are two advantages of being public in this sense. One is you have access to capital. Two you have a slightly higher profile so it is much more likely you get offered things and as we grow our covenant improves so that always helps with companies where there is landlord negotiations involved. I wouldn’t be surprised if something came along, but as Paul says there is nothing immediately under consideration.”

Next link up

May said: “The Next link up is not been too good for us. We are opening another one with them (Hounslow) and then we will make a decision on whether we take it further. Certainly the service station has traded well.

Johnson said: “The Next sites are profitable, but the footfall inside the stores isn’t as great as we would like. We are making returns, but we are going to review it after the next opening.”