City Pub Group Plc (LON:CPC) shares rose on Tuesday as the firm announced the appointment of Toby Smith to its board in the newly created role of chief operating officer with effect from November 10, 2020.
The group noted that Smith is a very experienced and senior operator with over 25 years’ experience in UK hospitality. He has held CEO roles with Stonegate Pub Company, Novus Leisure and Town and City Pub Company. Prior to these, he also held senior roles at Laurel Pub Company, Spirit Group and Scottish and Newcastle Retail.
In light of the current trading conditions, the company said that Alex Derrick, its joint managing director, by mutual agreement, will step down from the board and leave the company on November 10.
The group added: “The Board wishes to extend its thanks to Alex for the considerable part he has played in the Company’s development from the outset and wishes him all the best for the future.”
In a statement, Clive Watson, executive chairman of City Pub, commented: ”The challenges of COVID will also bring opportunity and we are seeking to position ourselves to take advantage of opportunities which undoubtedly will arise.
“The pub estate has been locked down far more effectively than the first time. All retail staff and a large number of Head Office staff are now on furlough. We intend to run our existing estate in the most efficient manner and our infrastructure is scalable for the next part of the journey when the pandemic is behind us.”
Warson added: “We welcome Toby to the business to accelerate the work that has been ongoing to achieve these goals. I and the Board look forward to working with him to build an even stronger, better business for the future.”
In morning trading, City Pub shares were 7.6% higher at 77.50p.
In a note to clients, analysts at Liberum Capital repeated a ‘buy’ rating and 135p price target on City Pub and said: “This is a great addition and adds significant depth to the team given Toby’s vast experience of growing multi-site pub operations.”
They added: “City Pubs shares rose 26% yesterday but has lagged the sector – down 65% YTD versus sector down 45% YTD – and is overdue a share price correction (as we write in our sector commentary this morning). It holds the strongest balance sheet in the pub sector yet is trading on 7.7x CY22E EV/EBITDA versus an average of 13.3x prior to the pandemic.”
— Adds share price, analyst comment —