Blue Diamond ambitions for 2023
Praise be to… the Blue Diamond Awards –
Alan Roper has booked Manchester Cathedral as the venue for the Blue Diamond Group Awards in March next year. “It’s kind of different,” he said. “I like quirky.” The nave has a capacity of 1100 people and can seat 940 for dinner – but they have to be out by midnight, so he intends to hire a nightclub for the after-party. The location will be a secret until the night.
instance, the group’s bulb sales this autumn were down 12% on 2020 (but 43% ahead of 2019). Growing media sales in the first three weeks of October were flat against 2020 (but again, massively up – by 91% – on 2019).
This, Alan Roper says, suggests that the “inflationary bubble” will eventually burst – it’s just a question of when. “I don’t think we’ll see it in February, March or April but I think we’ll see it through July,” he told GTN.
That said, it doesn’t look like putting the brakes on Blue Diamond’s expansion programme. The latest centre to join, Mere Park at Newport on the StaffordshireShropshire border, is the tip of the iceberg. Alan says two further acquisitions are due to complete in January (one of them in Surrey) plus a scheduled refurb on an additional site in the Westcountry.
This follows £16m spent on refurbishments this year, including a £600,000 investment on nursery production at Bridgemere to underpin the buoyant demand for plants. A similar spend in 2022 will include refurbs or next-phases and completions at Cardiff, Melbicks, Hereford, Cadbury and Weybridge, among others.
Alan Roper is predicting turnover of £250m for 2021, £265m in 2022 (but the three new acquisitions could add £10m), pushing on to £300m by 2023.
All this in what is currently a relatively quiet buying and selling market. Alan believes it will be the back end of 2022 before owners’ heads re-appear above the parapet as retirement or family succession issues crystallize post-pandemic. “I don’t think anyone really sells to get out of this industry by choice,” Alan says. “For most people, it’s retirement and family.”
In the meantime, Blue Diamond continues to bask in the glow of its 16 Wyevale acquisitions from Terra Firma in 2018 and 2019.
Since the deals were done, sales growth has ranged from 139% at Melbicks to 79% at Sanders Garden World (see graphic).
The category figures are interesting too –gardening sales have grown 155% at Hereford, plants sales 143% at Percy Throwers and garden leisure sales £289% at Nailsworth.
There’s so much growth opportunity that I can carve out in the garden centre market
Little Blue Diamonds?
We asked Alan Roper if he had considered following the Dobbies Group’s example of investing smaller city centre properties. This was his reply (edited):
AR: “No, no, no, I'm not going to go down that road. I can see why they did it, and I've spoken to him [CEO Graeme Jenkins] about it. I visited the one in Edinburgh. But if you’re going to have 100 little outlets, that's quite a different focus, a different level of detail and management. You've got to treat it as a separate beast and have a separate team.
“But I see why they're doing it. If your ultimate aim is to sell or do a float, which is what private equity is there to do, you need to show prospective shareholders or purchasers that there’s a growth opportunity. You can take it somewhere bigger than the whole concept of Little Dobbies, which is on the back of like these little Sainsburys and small Waitroses and that sort of thing.
“I wouldn't need to do that because there's so much growth opportunity that I can carve out in the garden centre market. I wouldn't want the added complication of trying to run a lot of Little Blue Diamonds, as they would all be leasehold. So, while it’s not without its merits, potentially it could become a big headache if it goes wrong.”