Dermot King promoted to Oakman Inns CEO as Peter Borg-Neal named executive chairman
Oakman Inns chief operating officer Dermot King has been promoted to chief executive of the pub group.
From 1 August, the group will also see chief executive Peter Borg-Neal (pictured, right) step up to the role of executive chairman and Mike Smith (pictured, left) step down as chairman but remain on the board as a non-executive.
The move will see King (pictured, centre) assume responsibility for the day-to-day management of the business, while Borg-Neal will focus his time on the company's development and growth.
Smith said he had informed Borg-Neal in 2018 of his intention to step down ahead of his 60th birthday in October, having chaired the business since it opened its first site in 2007.
He added: "It has always seemed crystal clear to me that it was Peter's destiny to become executive chairman of the business that he founded and has led so brilliantly over the years. Clearly, this could only be possible with a cogent succession plan and our initial conversations eventually led to the appointment of Dermot King as our chief operating officer in January 2019.
"Dermot and Peter have since formed an outstanding working relationship and, despite the current challenges, all our stakeholders can look forward to the future with great confidence."
Borg-Neal said: "Mike Smith has played a huge part in the success of Oakman Inns – as a major investor, an astute chairman and as a personal friend of mine. I am delighted that he has agreed to remain on the board, and I would like to take this opportunity to publicly thank him for his guidance and support over so many years.
"Once we started to look for my successor back in 2018, we quickly landed on Dermot as our first choice and was delighted when he accepted our offer to join as COO. He and I have a complementary skill set and over the past eighteen months we have formed a strong partnership."
King added: "I am honoured and delighted to become CEO of such an outstanding business. Having spent the last 18 months working alongside Peter and the team I genuinely believe there is no limit to what we might achieve.
"We remain deeply ambitious for the company and as market leaders in the growing premium pub sub-sector, we believe that the opportunities ahead of us for this deeply talented team, are very exciting."
Prior to lockdown, Oakman's like-for-like sales were up 4.3% year to date and total sales 14.3%. However, the sudden closure of the business in week 38 of the financial year meant sales of £31.5m represent a decline of 17.3% compared to the previous year. The group was able to complete a £1.8m equity raise from existing shareholders and secure a £2.1m Coronavirus Business Interruption Loan.
Since then, Oakman Inns opened all its 28 pubs on 4 July, and early trading has been positive, with like-for-like sales at 82% of last year's over the weekend. The majority of Oakman's 1,000 team members have now also returned to work from furlough.
The company is experiencing higher operating costs due to the cost of Covid-safe compliance, rising food prices and additional labour costs. However, it said it was confident that the VAT cut announced by the Chancellor earlier today will provide significant margin mitigation and, together with the Eat Out To Help Out scheme, will help boost demand in August as well as long-term.
Borg-Neal said: "We are focusing on strengthening our balance sheet to ensure that we can not only withstand any further shock wave but will also be ready to organically grow the business going forward through M&A and commercial property partnerships.
"To deliver this equity funding, we are considering a number of options including attracting a strategic investor and holding a retail fund-raising. We are therefore asking the Chancellor to urgently consider for the Autumn Budget the provision of investor tax breaks and the lifting of all restrictions on the Enterprise Investment Scheme for the rest of the financial year 2020/21."
Pipeline sites in Buckingham, Wokingham and Epsom are expected to open in 2021, and one in Hatfield in early 2022.
