60 Seconds. Actions Speak Louder than Words…:
Demand softer & economy is slowing; why so little comment?
- Data shows construction, industrial output & manufacturing output fell in Q2
- Car production is lower year to date & GDP targets may be undershot
- Big ticket spending (see e/ms) may bear the brunt
- House transactions, furniture sales & car sales are slowing but holidays look OK
- In light of the above, what comment should we expect from leisure retailers?
No reward likely for bearer of cautionary news:
- Unsurprising, perhaps, that there is no rush to be the first to speak.
- Some operators, Richoux, Tasty (twice) & others have had no choice
- But elsewhere, there are no prizes for caution. But actions speak louder than words
Unit closures, unit sales, share buybacks rather than expansion seem the order of the day:
- Tasty, Richoux, Comptoir, Restaurant Group & others have warned on trading
- Many operators are selling (or simply shutting) units. JDW has cut c10% of its estate
- The Diner, Byron, Restaurant Group, Wildwood, Prezzo, ASK, Strada & others have units for sale. Good luck with that.
- JDW has spent c£42m buying back shares since 4 July. It has cut around 10% of its units
- To succeed one must be relevant, authentic, well-financed & not overrented.
- And it helps to be lucky. Give it a try someday.