Pubpaper 779 – Label Perfection and Punch Troubles

Posted: 9th October 2014 by santobugtio in Pub Paper, Writing
Tags: ,

15671-c1I’ll open this weeks column with some news from the World Beer Awards 2014.   Every year over 1000 beers are entered for consideration from over 60 countries in 9 categories, with 7 for distinct beer styles, an overall winner and best beer label.   I’m delighted that one of my favourite beers, Great Heck Black Jesus, a fantastic 6.5% Black IPA has won the best label award this year.  Judges said “Good use of green shades giving the feeling of coal mines. Excellent technical illustration using simple shapes to further create even more detailed shapes. The use of symmetric and consistency of design over the entire label make this a worthy winner.”.  Congratulations to the team over in Selby whose range of beers including Yamika IPA, Shankar IPA and Amish Mash are all worthy of an extended session.   The other regional winners from America and Asia (Black Jesus won the European Award) provided strong competition and were excellent designs, so it shows how strong their branding is, something repeated across the range.

Looking at the winners in the beer style categories, awards were spread between America, Germany and Belgium and Australia, with no other British winners.  However we did pick a number of Gold Awards in the European section of the competition.  Brew Dog Libertine Black Ale won a Best Black IPA award, Thwaites Nutty Black won a Best Mild award, whilst Brew Dog won a second award with a Best Chocolate and Coffee Award with their Cocoa Psycho, a cracker of a 10% beer I’d recommend you to try, rounding off the hat trick for them was their 5am Saint in the Best Amber category.

When it comes to what we would call more traditional beer styles in this country we also got an impressive haul, with Gold Awards for Hook Norton (x2), Jennings, Thwaites (x3), Harviestoun, St Austell (x2).  Thornbridge also won a brace of gold medals   What this shows is that our breweries, whether they are defined as craft, real ale or volume producers, can compete with the best in Europe.  Of course the Germans and Czechs are dominating the Lager Category Gold Awards as that style of beer is their speciality, and if the Belgians didn’t win the Belgian Style Gold Awards, something has gone seriously wrong with their brewers.

Now onto what on the surface is positive news for Punch Taverns pub tenants after the company’s proposals for restructuring their debt was accepted by the Royal Bank of Scotland and Lloyds Bank.  This process has been rumbling on for very nearly a year now.   Other shareholders including Hedge Funds had accepted the deal offered prior to the banks giving the thumbs up.  However there are doubts if any benefits will reach those on the front line behind the bars of the pubs they lease out.

The company finances are still not healthy, using a medical analogy, the patient is out of intensive care, but is being kept in for observation.   Hedge funds returns and debt servicing are taking the majority of the money out of the business and both costs will not be reduced to aid the tenants.  In fact interest rates will only realistically go up and hedge funds will demand more dividends or move the investment on someone else who will do the same.   Punch Taverns recognise that a good chunk of their value derives from their property portfolio, so are reluctant to sell to tenants at a reasonable market price, knowing that they can sell to supermarket or takeaway chain at a premium for conversion to retail or catering without planning permission.  Even if they don’t sell the pub they can lease for far more than a sitting pub tenants would be able to be charged, per square foot a Tesco Express which has all day demand can make far more per year than a pub where its services are in demand to wildly different degrees across the day and week.

All the major pub companies who aren’t tied to breweries are in the same position, highly leveraged with debt, serviced at the cost of the pub tenants.   Enterprise Inn’s stock market shareholders demand their pound of flesh as much as any hedge fund.   You see a happy landlord, you can pretty much guarantee that they are freehold and keeping all the money they make and buying the beer they want at reasonable prices.  Freedom brings happiness in most walks of life, pub management included.

 

  1. J Mark Dodds says:

    Cracking piece on Punch