Restaurant Groups see a decline in February sales

According to a report by Business Tracker CGA RSM, some restaurant groups reported a 0.6% drop in sales in February.

Britain's leading restaurant, pub and bar groups delivered fractional like-for-like sales growth of just 0.1% in the second month of the year, well below the current inflation rate.

It continues the sector's challenging start to 2025, following a 1.3% year-on-year drop in January.

"A second month of lackluster trading results means that the hospitality sector remains in negative territory for the year to date," says Saxon Moseley, head of leisure and hospitality at RSM UK.

"Consumers are opting to cut back on discretionary spending amidst growing apprehension about the UK economy and global instability."

The Tracker shows February delivered 2.5% growth in total sales, including all venues opened by groups in the last 12 months.

However, with key costs still inflationary—including via extra National Insurance contributions from April—the Tracker notes that hospitality margins remain 'extremely tight.' Pubs performed the best of the major hospitality channels in the Tracker for the third month in a row.

Like-for-like sales finished 1.7% ahead of February 2024, having been partly boosted by the start of the Six Nations rugby tournament.

With some consumers limiting their meals, restaurant groups' sales fell by 0.6%.

While February featured Valentine's Day, this year it occurred on a Friday, a day that already generally sees higher on­ premises visitation compared to other days of the week, and last year, it fell on a Wednesday, resulting in a missed mid­ week sales boost this year.

Bars continued a long-term drop in growth, with like-for-like sales down by 7.9% in February.

The on-the-go segment of the market slipped 1.9%.

The Tracker shows that hospitality had a slightly tougher month in London than elsewhere.

Groups' sales inside the M25 were down by 1.2% year-on-year, but beyond the M25, they recorded a marginal rise of 0.5%.

"After a flurry of spending over Christmas, it's clearly been a challenging start to 2025 for the hospitality sector," says Karl Chessell, director - of hospitality operators and food, EMEA at CGA by NIQ."

"Growth is fragile, and hikes in National Insurance Contributions will put even more pressure on managed groups."

"We remain optimistic that spending will start to loosen, and brighter weather and big occasions like St Patrick's Day, Mother's Day and Easter should help to rally sales." Nevertheless, real-term growth will remain hard-earned for the foreseeable