Welcome to the January edition of Bord Bia's Ireland Market Foodservice Newsletter.
Bord Bia’s virtual Small Business Open Day takes place on Tuesday, 26th January from 10AM-11:30AM. The seminar will be opened by Minister of State Martin Heydon and speakers include Tara McCarthy, CEO Bord Bia, Laura Harper, Aldi Buying Director and Karen O’Neill, BeeKon Batches. There’s also the opportunity to book 1:1 meetings with your Bord Bia Sector Manager, as well as other representatives from the Bord Bia team following the event. For more information and to register your attendance, go to this link.
Unfortunately, shutters have once again descended on the Irish hospitality industry as of 24th December, amidst soaring Covid 19 case numbers and a return to Level 5 restrictions. Consumers are restricted to a 5K radius of their homes and hotels are offering services to essential workers only. Restaurants and bars serving foods are confined to Take Away, Home Delivery and Drive Thru offerings. The opening months of 2021 look set to be remarkably challenging for all involved, with the fate of the industry dependant on the pace of vaccination roll out and reopening dates.
GENERAL INDUSTRY NEWS
Irish manufacturing ends 2020 with stronger expansion
Business Post – 05.01.2021
The Irish manufacturing sector saw a boost to business in December as firms prepared for the end of the Brexit transition period, according to the latest Purchasing Managers Index from AIB. Output rose at the fastest rates since July's post-lockdown bounce, and purchasing accelerated as firms sought to expand inventories to guard against a potential hard Brexit. The PMI rose sharply from 52.2 in November to 57.2 in December. This signalled a sixth overall improvement in manufacturing business conditions in the past seven months, and the strongest growth since July.
Economy set to grow in 2021
Business Post – 18.12.2020
The economy will end up growing by 3.4 per cent this year, according to the Economic and Social Research Institute. In its latest Quarterly Economic Commentary, the think-tank said exports by pharmaceutical and IT companies have remained strong but the shock of Covid-19 will impact the domestic economy for some time to come. The ESRI described its forecast as "somewhat surprising" and it comes as official government projections are for a decline in GDP of 2.4 per cent.
QUICK SERVICE RESTAURANT (QSR) & PUB SECTOR
Revenues at Supermac's group rose 10% in 2019
RTE Business – 01.01.2021
Revenues at fast food, hotel and property group Supermac's jumped by 10% to €189.4m in 2019. New accounts show that the Pat McDonagh led firm enjoyed a record year before Covid-19 hit the business in 2020. Supermac’s (Holdings) Ltd recorded a 3% increase in pre-tax profits to €24.5m in 2019. This follows revenues rising by 10% from €172m to €189.4m. In an interview last month, Mr McDonagh estimated that his fast food business will be down around 30% in revenues for 2020 while the hotel business will be around "70% plus down" due to the Covid-19 enforced closures and tourist industry impact.
JD Wetherspoon commits its largest investment ever into a pub and hotel, at more than €33m
Propel – 15.12.2020
JD Wetherspoon has made its largest ever investment, in excess of €33m (£29.9m), to buy and develop a new pub and hotel in Dublin. The site – Keavan’s Port – is on Camden Street and will have 89 en-suite bedrooms and employ 200 full-time and part-time staff. The investment of €6m to purchase the property and €27.4m to redevelop it is “the single largest investment” made by Wetherspoon in its 41-year history.
HOTEL & RESTAURANT SECTOR
Varadkar says businesses should plan to remain closed for three months
Irish Times – 07.01.2021
Tánaiste Leo Varadkar has advised businesses that are closed at present to plan to remain closed for the first quarter of this year. When it was possible restrictions on businesses would be eased as they were closed, with sectors such as construction returning first, and moving down the list to non-essential retail. Mr Varadkar said he knew businesses wanted certainty, which he could not offer, so the best thing for them to do was to plan “that this will be a three-month period”. Business groups representing retail and hospitality reacted with an air of resignation to the Tánaiste’s prediction of a shutdown for the entire first quarter, given the scale of the public health challenge with galloping infection rates.
Dalata anticipates to end year marginally ahead of market expectations
Business Post – 18.12.2020
Dalata Hotel Group said that despite the challenging environment, its earnings for the year to the end of December are expected to be marginally ahead of market expectations. In a year end trading update, Dalata said its operations in the second half of the year was continually and acutely disrupted as a result of Covid-19 restrictions across its markets in Ireland and the UK. Dalata said that occupancy in the third quarter came in 26 per cent in Dublin, 60 per cent in its hotels around the country in Ireland and 36 per cent in the UK.
CASUAL DINING & CONTRACT CATERING SECTOR
Eddie Rockets secures approval for refinancing proposal
Irish Examiner – 04.01.2021
The impact of the Covid-19 pandemic has resulted in “a significant decline in revenues” for all of the Eddie Rockets restaurants. New accounts for Eddie Rockets Ireland show it has secured credit approval for a refinancing proposal with its lender as it deals with the pandemic. The refinancing discussions are ongoing, which will “provide essential capital to support the business". The group, which has 40 outlets, is battling the latest enforced shutdown for the hospitality industry. It is operating call-and-collect and online services. Covid-19 "has resulted in a significant decline in revenues for all of the company’s restaurant locations”, the accounts say.
Danish delivery tech firm to grow Irish operation
Independent.ie – 03.01.2021
After a surge in demand for food delivery this year, Danish company Orderyoyo plans to deepen its presence in Ireland. The company develops software for restaurants to build and manage their own food-delivery sites rather than use large marketplaces like Deliveroo. Orderyoyo, which competes with Irish start-up Flipdish, has around 600 restaurants in Ireland using its services with five sales staff on the ground managing operations who report to the company's Manchester office. Orderyoyo works with some brand name operations including Beshoff Bros and independent Abrakebabra franchisees. Its software allows restaurants to create their own branded food ordering apps and carry out their own deliveries.