The Investment column: Hard Rock lets Rank down
Friday 20 December 1996
The biggest surprise came at the Hard Rock themed restaurant chain. While just about any old branded concept serving up half-decent beer and grub seems to be coining it, Hard Rock has spectacularly missed out on the bonanza. True, a BSE beef scare closed the Paris branch for 15 days in the autumn, but nevertheless like-for-like sales in the 32 Hard Rock cafes fell 4 per cent - analysts noted that in London turnover rose a sub-inflationary 2 per cent while sales fell in New York. Not surprisingly, Hard Rock has recently expanded its national and local sales forces in the US to beef up the marketing effort.
The other concern is the slipping timetable for the planned pounds 1bn sale of Rank's remaining 20 per cent stake in copier company Rank Xerox. Originally due to take place in the first quarter of 1997, the talk now is of a sale some time before the end of 1998. The sale is seen as a way for Rank to return cash to investors, either in the form of a share buy-back or special dividend, but they should not hold their breath.
Disposals of non-core assets form a key part of the strategic review recently completed by new chief executive Andrew Teare, formerly of English China Clays.
Yesterday saw the Shearings holiday coach business finally sold to its management for pounds 83m. All told, Rank has raised more than pounds 200m during the second half, though borrowings still remain around pounds 1bn after Rank splashed out pounds 123m in October for the Tom Cobleigh chain of themed pubs. That deal raised eyebrows in the City and prompted accusations that Rank, for all its talk of restructuring, was still prepared to pay full prices for cyclical businesses at the top of the economic cycle.
Broker Kleinwort Benson sticks with its bottom-of-the-range forecast of pre-tax, pre-exceptional profits of pounds 294m this year, rising to pounds 345m in 1997. That implies a price/earnings ratio of 17 falling to 15. Unexciting.
- 1 Paris attacks: Do not call Charlie Hebdo killers 'terrorists', BBC says
- 2 Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
- 3 UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
- 4 Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
- 5 The enemy within: People who hear voices in their heads are being encouraged to talk back
Paris attacks: Do not call Charlie Hebdo killers 'terrorists', BBC says
Rowan Atkinson to sell £10 million McLaren 'supercar' he crashed into a tree and a lamppost
UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Howard 'Mr Nice' Marks reveals he has inoperable cancer: 'I've had an incredible life'
Nigel Farage: NHS might have to be replaced by private health insurance
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
George Galloway condemns 'racist, Islamophobic, hypocritical rag' Charlie Hebdo at freedom of speech rally
British Muslim school children suffering a backlash of abuse following Paris attacks
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