Some of Britain's leading pub and restaurant operators have reported tough trading in February, with like-for-like sales down by 3.7% on average during the month, compared with the same period last year.
The drop comes after a 2.1% fall in January, according to the Coffer Peach Business Tracker, which follows the progress of 23 pub and restaurant groups on a monthly basis. Participants include Mitchells & Butlers, Pizza Hut, Whitbread, Gondola and Marston's.
Total sales in February, which include the effect of new openings, were only marginally up on last year at +0.6%. Month-on-month, February sales were up 8.4% on January.
"These are disappointing figures, as over the past two years the informal eating- and drinking-out market has generally kept its head above water despite everything the economy has thrown at it," said Peter Martin of Peach Factory, the business intelligence specialist that produces the sector Tracker, in partnership with KPMG, UBS and the Coffer Group.
"It might be a prolonged hangover after what was bumper trading over Christmas and the New Year, or it might signal a new tightening of consumer belts - certainly poor weather played its part. The market will do well to remain cautious, but also focused on giving customers, who may be looking for something new, a compelling reason to go out. We are still predicting another essentially flat trading year," Martin added.
The market had recorded collective like-for-likes up 9.9% in December, with total sales ahead 13.7%.
The latest, more downbeat, Tracker figures are in line with other published data, with JD Wetherspoon reporting like-for-likes down 0.7% in the six weeks to 4 March. Pubs generally continue to trade better than high-street restaurant chains.
Trevor Watson, director of valuations at Davis Coffer Lyons, said: "Although the longer-term pictures remains broadly flat, the short-term results for February, which reflect the adverse weather during the month, are naturally disappointing. Value for consumers has never been better in the eating-out market, and as some operators look towards moving away from discounting there could be a small increase in spend per head later in the year.
"Operators continue to remain focused on margin preservation. Clearly London operators are looking to maximise the benefits of the Diamond Jubilee and the Olympics. These provide a fabulous opportunity, but will lead to some redistribution of trade and some operational challenges."
Richard Hathaway, KPMG's Head of Travel, Leisure & Tourism, added: "Trading conditions for the sector remain tough and they are likely to be with us for a while. The cold weather in early February added to the challenges presented by still fragile consumer confidence.
"However, over the past 18 months we have seen just how resilient the UK's eating- and drinking-out market is and total sales growth remains positive, due to the impact of recent and continued investment by the major pub and restaurant operators in new and revamped sites."
By Neil Gerrard
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