Oakman Inns has just reported results for Financial Year 2017/18 (Sunday 1 April), showing sales for the year of £28.3m.
There was total growth of 22.2% for the year, with similar increases across all three revenue streams – drinks, food and rooms, and like-for-like (LFL) growth stood at 6.8%.
Site EBITDA (unaudited management accounts) has exceeded £5m for the year, and the firm has seen an excellent performance from the new sites and major developments, all of which are exceeding their investment targets.
CEO and company founder, Peter Borg-Neal, said, “We have had an excellent year with significant progress on many fronts. We were delighted with our 6.8% LFL growth, but it is perhaps even more pleasing that our Comparables are, at 5.4%, showing the strength of our core estate. This excellent like-for-like sales growth has continued into the new financial year, and we are 5.2% up over the first seven weeks despite rolling over Easter 2017.
“We opened two new sites towards the end of the last financial year, The Beech House in Amersham and The Cherry Tree in Olney, and they have both substantially overperformed against their investment target averaging, respectively, over £49k net and £45k net since opening.
“We also acquired The Anchor in Hullbridge in August of last year and the company intends investing in the site in the coming months. Even without that investment, The Anchor is already averaging over £36k net per week for the year to date. During the year, we also made substantial investments in the refurbishment and extension of two existing sites – The Betsey Wynne in Swanbourne and The Akeman in Tring, both of which are operating at sales levels well in excess of their respective investment targets.”
Borg-Neal continued, “Our trading split is now 40% drinks, 52% food and 8% rooms. We are very happy with that and we believe it is likely to remain broadly the same as the estate grows.
“We believe that this year, Oakman can grow its sales to exceed £37m. This sales increase will derive from the existing portfolio and three main areas of business growth. Firstly, the gradual accumulation of quality sites for the core Oakman Inns business with a preference for freeholds. Secondly, an increased focus on developing and growing the Beech House brand in leasehold sites and finally the operation of management contracts for premium pubs and hotels owned by others.
“Our current estate development activity amply illustrates these three growth sectors. We are opening the Four Alls, our second Hunky Dory development, in Welford-on-Avon on June 1st and this will be followed on July 12th by our opening of The Royal Foresters in Ascot, our most substantial freehold investment to date. The Royal Foresters opening was delayed by the cold, wet weather in late winter and early spring, meaning we missed the Royal Ascot meeting, but we will be open in plenty of time to benefit from the other major summer racing events.
“Our property pipeline remains strong, and we have agreed on deals for sites in Epsom, Prestwood, Hatfield and Hampton Hill. A further four sites are currently under negotiation, and we are hopeful of successful conclusions to those negotiations. We have also acquired the units next door to our highly successful Beech House in Beaconsfield and will be extending and upgrading the site later in the year.
'Additionally, we are seeking planning permission to add substantial hotel blocks to the White Hart in Ampthill and The Akeman Inn in Kingswood enabling us to maximise use of the substantial land surrounding these two freehold sites.'
Borg-Neal concluded, “We are still disturbed by the Government’s inflexibility on the matter of business rates, the on-going disparities of VAT and the inept mismanagement and financial impact of the Government’s Apprentice scheme. We do, however, welcome the Government’s eventual support for our campaign to ban straws and our aspiration to ban the consumption of single-use plastics throughout Oakman Inns. These little differences, if made by every company, will help make a world of difference.”