Levy Restaurants Placing Robots in Stadium/Arena Kitchens

Levy Restaurants

Levy Restaurants is working in collaboration with Miso Robotics to develop an industrial robotic arm capable of handling assistant cook responsibilities, within commercial kitchens at sporting venues. “Flippy”, “built as a 3rd hand for overworked chefs”, will be able to complete a variety of tasks ranging from flipping hamburgers (hence, the name) to changing out spatulas that touch raw food (per safety regulations). The robotic kitchen assistants will take over positions that require less skill, but the individuals currently occupying those jobs will not be let go; Levy Restaurants (and its venue partners) intend on moving those individuals into consumer facing, customer service roles. Though still in the initial pilot testing phase, the technology is expected to debut at Dodger Stadium this summer.

Howie Long-Short: Levy Restaurants built a 10-person robotics and AI team, invested $2 million into “Flippy” and then participated in Miso Robotics $10 million Series B round (the company has raised $13.1 million in total); so, expect the future of industrial kitchens to have robots handling the cooking and prep work. The Compass Group (OTC: CMPGF) subsidiary is the world’s largest food service company, serving over $5.5 billion meals year, so their investment in a technology that will ensure more consistent food quality and increase the speed of delivery, seems wise. CMPGF isn’t the only way to play Miso Robotics though, Acacia Research (ACTG), a publicly traded patent licensing company, led both company rounds.

Fan Marino: It was disappointing to learn that “Flippy’s” Dodger Stadium debut will be at a popular fried chicken stand and he/she won’t be handling the “flipping” of the team’s traditional “Dodger Dogs”. Of course, tradition doesn’t necessarily mean high quality; hot dog historian Bruce Kraig once described the L.A. ballpark staple by saying, “it won’t kill you.” Since their 1962 debt, Farmer John (producer) has sold more than 3 million Dodger Dogs per year.

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Sodexo Acquires Operator of Food and Hospitality Services at U.S. Sports Venues

Sodexo (OTC: SDXAY), a global event manager and catering company, has acquired Centerplate; the 4th largest operator, by revenue ($1.18 billion, 12-month prior to June ‘17), of food and hospitality services at U.S. sports and entertainment venues. SDXAY generated $1.07 billion in ’16 sports and leisure revenue, so the $675 million acquisition will more than double the company’s business within the segment. CEO Sports & Leisure Worldwide for Sodexo, Pierre Henry, explained that the acquisition is “another step in our long-term strategy to become a leading player in every market in which we are present.” Centerplate CEO Chris Verros will stay on board to lead the company’s U.S. business.

Howie Long-Short: Back in July, Jefferies analyst Kean Martin said, “Sodexo may be losing market share to Compass (OTC: CMPGY), which benefits from scale and a differentiated multi-brand strategy, particularly in the US.” Well, picking up Centerplate helps SDXAY increase U.S. market share; and 2017 acquisitions of Prestige Nursing + Care (home-care) and Morris Corporation (facilities management) strengthen the company’s multi-brand strategy. It seems as if SDXAY is headed in the right direction, after the company cut its full-year sales growth target; following a disappointing fiscal Q3 ’17 (in July). Temper your short-term expectations though, Sodexo only expects the Centerplate transaction to be “mildly accretive to earnings for fiscal ‘18”.

Fan Marino: Centerplate currently operates at the following U.S. sporting venues; Hard Rock Stadium (Miami Dolphins), Safeco Field (Seattle Mariners), AT&T Park (San Francisco Giants), BB&T Center (Florida Panthers) and Smoothie King center (New Orleans Pelicans). My personal all-time favorite Centerplate creation? The Ichiroll at Safeco Field.

Services group Sodexo buys Centerplate to strengthen U.S. presence

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