• Christmas and New Year like-for-like sales up 2.8% on 2013
• London operators and restaurant chains lead the celebrations

Pub and restaurant groups had a Christmas season to celebrate with collective like-for-like sales up 2.8% on the same period last year. Latest figures from the Coffer Peach Business Tracker also showed that London had more to cheer than the rest of the country with like-for-like sales up 4.4%%, compared to 2.3% for outside the M25 over the six weeks, including New Year, up to January 3.

Total sales, which include the effect of new openings, were up 6.6% on 2013 among the 30 leading groups that make up the Tracker sample.

“With supermarkets and specialist off-licences, like Majestic Wine, seeing seasonal sales suffer, it seems the British public decided to go out and have fun rather than just stay at home,” said Peter Martin, vice president of CGA Peach, the business insight consultancy that produces the Tracker, in partnership with Coffer Group, Baker Tilly and UBS.

Generally, restaurant chains also had a better Christmas season than pubs, with collective like-for-likes 4.7% ahead of last year, compared to a 2% collective increase for managed pub and bar groups.

“The success of casual dining groups, especially outside of London, suggests that Christmas time is not just about people going out to find a traditional Christmas dinner, but also about general family and friends time,” added Martin.

Within the pub and bar sector, drink-led businesses had the best of it, with like-for-likes up 3% over the six weeks period, with those inside the M25 enjoying a 5.6% increase. “Although drink sales were up 2%, food was the biggest driver of growth, even within these predominantly drink-led environments, with sales up 6.8% over the period,” added Martin.

“It is interesting that while pubs in general seem to be flourishing inside the M25 and still finding it tougher away from London, casual dining brands are having a better time of it away from the capital,” observed Martin. Like-for-like growth for casual dining brands outside of London was 5.4% over Christmas, compared to 3.6% inside the capital.

“What’s clear is that the eating and drinking out market is performing more strongly than retail, with latest British Retail Consortium figures showing a 0.4% like-for-like decline in December for the retail sector against 2013. For the British public it is not just about acquiring things any more it’s about buying experience – and perhaps this sector rather than retail should be the accepted measure of economic health,” said Martin.

“The increase in eating and drinking out spend across all sectors, restaurants, bars and pubs, suggests people are perhaps not as depressed by the pressure of austerity as politicians would have us believe, and if David Cameron ever wants to resurrect his ‘happiness barometer’ perhaps this is it.”

Mark Sheehan, managing director at Coffer Corporate Leisure, said: “The December 2014 numbers were excellent, capping a resurgent year for eating and drinking out. Despite the lowest inflation on record the sector continues to outperform, and with consumer spending likely to increase, we expect to see continued good growth. Operators will also benefit from better margins. Savvy investors have been acquiring businesses in the sector for the last 24 months and the consistent like-for-likes show why. There remains massive competition and huge disparity between winners and losers but those with a compelling offer, wherever they are in the country, will continue to see good growth.”

.Also on an upbeat note, Paul Newman, head of leisure and hospitality at Baker Tilly, added: “The lack of a white Christmas clearly did not dampen the festive cheer as UK consumers flocked to their local bars and casual dining outlets. Looking forward to 2015, with sinking oil prices pushing inflation even further southward, the low interest rate environment is likely to continue in the foreseeable future. The combination of the impact of lower oil prices on supply chains and an economic environment which supports spending over saving will no doubt delight both operators and investors in the sector. As a result, as well as driving top line growth, we expect to see improvements in trading margins during the year ahead.”

Jarrod Castle, leisure analyst at UBS Investment Research, said: “LFL sales growth for the Christmas period was a deceleration from November, which was +3.4%, but was better than October, September, August and July. This leaves the 12-month moving average growth rate at 2.8%. December also marked the 21st consecutive month of positive growth for the sector”

The Coffer Peach Tracker* industry sales monitor for the UK pub and restaurant sector collects and analyses monthly performance data from 30 operating groups, and is recognised as the established industry benchmark.

Coffer Peach Business Tracker is powered by Demographix

About Coffer Peach Business Tracker
CGA Peach collects sales figures directly 30 leading companies. Participants include Mitchells & Butlers* (owner of Harvester, Toby, Browns, All Bar One etc), Pizza Hut, Whitbread (Beefeater, Brewers Fayre, Table Table), Pizza Express, Spirit Group (Flaming Grill, Fayre & Square), TGI Fridays, Tragus (Café Rouge, Bella Italia), Stonegate (Slug & Lettuce, Yates’), Marston’s, Gondola (Zizzi, ASK), Wagamama, YO! Sushi, Novus (Tiger Tiger), Fuller’s, Carluccio’s, Young’s, Living Ventures, Strada, Amber Taverns, Hall & Woodhouse, Las Iguanas, Intertain (Walkabout), Tattershall Castle Group, La Tasca, Giraffe, Loungers, Byron, Peach Pub Co and Le Bistrot Pierre. *includes Orchid Pub Co acquisition