Brighton Pier Group announces a trading update for the six-month period to 31 December 2018 (the “Period”) and its outlook for the current financial year.
The Company’s Fez bar in Putney was closed for a full refit at the end of July 2018. The site relaunched as ‘Le Fez’ at the beginning of December and performance since then has been in line with management’s expectations, however the refurbishment works were protracted due to structural issues. Christmas trading across the Bars division was broadly flat year on year, but trading conditions are challenging across parts of the estate. The impact of these issues will result in earnings from the Bars division being lower than previously expected for the Period.
As previously reported, the trading performance of the Company’s Pier division during the Period has been negatively impacted by disappointing weather over the August bank holiday weekend that continued into the following month. Additionally, weekend railway services to and from Brighton have been disrupted by a major programme of engineering works, resulting in recurrent line closures (with replacement bus services) on the main line from London between the stations at Three Bridges and Brighton. This has significantly impacted the number of visitors into Brighton and onto the Pier. As such, earnings from the Pier have also been lower than expected for the Period.
The Company has been informed that these line closures will continue into the second half of the current financial year, including a complete closure over the nine days of February half term and further closures in March, April and May (the start of the Pier’s peak trading period). However, once the railway upgrades have been completed, the Company expects that the improved railway service with fewer interruptions will benefit businesses across Brighton, and the trading performance of the Pier.
The Company’s Golf division continues to trade in line with expectations. A new site is due to open at Rushden Lakes in April 2019, bringing the total estate in the Golf division to 7 locations. A further site is planned to open in the following financial year at Drake’s Circus in Plymouth.
The Board now anticipates that, as a result of the reasons outlined above, profit before tax for the current financial year will be in the region of 18% lower than current consensus expectations.
Commenting on trading, Anne Ackord, Chief Executive Officer, said: “Whilst I am disappointed at the rail network disruptions currently affecting the Pier, once they are complete, this will be of great benefit to future visitors travelling to the city and consequently to our Brighton businesses. Despite these challenges the Company’s Pier, Bars and Golf businesses remain well invested, strongly cash generative and well positioned for future growth.”