A Day in the Life:

So it’s spring coming on summer and the sap is rising.

And our grumpy old drake certainly knows that as he – and more specifically his fox-diminished harem of hens – have been knocking out fertilised eggs for a while now, some dozen or so of which are sitting in our Heath Robinson incubator and one of which at least is now cheeping and exhibiting a number of suspicious-looking cracks.

Add to that the fact that one of the ducks has laid her twelfth egg without us collecting them and has flipped overnight from a layer to a brooder. She’s now sitting on her produce and hissing like a good one at anyone or anything that comes within a couple of feet of her.

All of which means, if my arithmetic is correct, that we may have two dozen more ducks within a pretty short space of time and our ten-year old clearly wants to name them. She’s suggesting sparky, Mr Quack and waddle (etc., etc.) whilst I’m going with crispy, grilled and 22x roast. On to the news:

The News:

RECENT WEBSITE ARTICLES:

• Euro 2016 & leisure; see here

• Market getting tougher? See here

• Main features London hotels, slowing markets, Restaurant Group etc. Link to index page – here

• Ongoing tweets, older emails found – here

FULLER’S – FY NUMBERS TO 26 MARCH 2016:

• Fuller’s. Good numbers but LfLs slowing & beer negative to end-March. Numbers slowed further in current period.

• Fuller’s (FSTA) reports FY numbers for the 52wks to 26 March. Says has produced ‘another excellent year from our great team of people’

• FSTA FY: Reports revenue +9% at £350.5m, EBITDA +11% at £65.0m, adjusted PBT of £40.9m (+11%).

• FSTA FY: Group reports adjusted EPS +13% at 58.35p and a full year dividend up 8% at 17.9p per share.

• FSTA FY: FY LfL sales increase of 4.8% in Managed Pubs & Hotels. Tenancies ‘solid’, LfL profits +2%. Beer volumes down 1% & profits level

• FSTA FY: Group acquired 5 pubs during the year & built one. It bought in the freeholds of 3 further units. Fuller’s says it has seen a ‘record level of investment in the existing estate, providing strong returns.’ Re brewing, Fuller’s has ‘enhanced our craft beer range with new keg and canned products and grew sales and distribution of Oliver’s Island, Frontier Craft Lager and Cornish Orchards Cider.’ It has opened 6 The Stable sites during the year.

• FSTA FY: Current trading (1st 10wks) managed LfL sales +2.7%, tenanted LfL profits down 2% and beer volumes down 5%

• FSTA FY: Re current year, group says it has a ‘record year planned for investment in existing estate with seven schemes already completed and four more underway.’ It says it is ‘well-positioned for the future, with a solid, proven long-term business model and strong balance sheet.’ CEO Simon Emeny reports ‘it has been another outstanding year for the Company and I am delighted to be reporting an excellent set of results, particularly in the largest part of our business – our Managed Pubs and Hotels.’

• FSTA FY: CEO Emeny continues ‘our long-term approach is underpinned by a consistent strategy, but we continue to seek new, exciting opportunities to build our business further – keeping the Brewery as our beating heart. We have purchased pubs in geographical areas where we have previously lacked a presence, introduced new premium brands that the consumers of today and tomorrow are seeking out and continued to develop our pub designs and the quality and creativity of our menus.’

• FSTA FY: Group says ‘the economy is difficult to read with the European referendum imminent, but while it is important to be aware of the external environment, we will continue with the exciting plans we have in place and our long-term perspective gives us the flexibility to react accordingly.’

• FSTA FY: Re balance sheet. Debt up by £36m at £198.5m (on freehold buying etc.). No gearing issues. Group concludes ‘as we look forward to the year ahead, we know that our long-term strategy, combined with the vision to address the needs of our customers and consumers of the future, will keep Fuller’s on the path of growth. By continuing to invest in our assets, our brands and, most importantly, our employees, we will continue to build a Fuller’s that delivers outstanding service to our customers, excellent careers for our people and good returns for our shareholders.’

PUB, RESTAURANT & DRINKS PRODUCER NEWS:

• Has London slowed? See Fuller’s numbers above. Group hosts analysts’ meeting at 11am & will be questioned further

• Tesco sells Giraffe to Boparan Restaurants for an undisclosed sum. CEO Dave Lewis says no longer a core area for focus. He comments ‘as we stabilise the business in the UK, we continue to focus on where we can best serve the needs of our customers, while ensuring our business remains sustainable for the long-term.’ Mr Lewis continues ‘Giraffe is a much loved brand, and while casual dining remains an important part of the shopping trip for many of our customers, we will continue to meet these needs through our Tesco Cafés and other providers.’

• Spirits producer Remy Cointreau yesterday reported FY net profits up by more than 10%, driven largely by higher cognac sales

• Remy: Revenues up 8.9% at €1.05bn, net profits up to €102.4m from €92.6m in 2015. Dividend +4.6% at €1.60 per share. The group says the ‘Europe, Middle East and Africa region delivered a strong performance in the year led by the Group’s expansion strategy in Africa, while the Americas region benefited from remarkable growth in the Group’s brands amid a favourable environment for dark spirits, particularly in the United States.’ Re current trading, Remy comments that it is ‘confident in its acceleration strategy of moving upmarket, the Rémy Cointreau Group expects to deliver growth in current operating profit, assuming constant exchange rates and consolidation scope, in financial year 2016-2017.’

• JDW Wednesday bought back 62k shares at 725p per share. Since Jan this year, it has bought back 3.7m at a cost of £25.5m.

• Enterprise Inns yesterday bought back 99k of its own shares for cancellation at a price of around 95p.

• MCA writes that Hawksmoor owner Graphite Capital has acquired 14-strong New World Trading Company, which includes The Botanist, for £50m.

• The spring frosts that settled in the Loire Valley in April have cost the region up to 30% of its harvest, though some vineyards have been affected more than others. The worst hit areas were the vineyards of Touraine, Nantais, and Sarthe, where losses of up to 80% of some communes have been reported.

• Blackpool is considering a ban on alcohol adverts in the town by 2018 in an attempt to reduce drink-related crime and health problems. The latest reports indicate that drink-related deaths for both men and women in Blackpool are ‘significantly higher’ than the national average.

LEISURE TRAVEL:

• The US hotel industry saw occupancy fall 6.8% to 64.6% in the week ending 4 June, while average daily rate was flat at $118.45 and revenue per available room also fell 6.8% to $76.56.

• Hotel bookings into the US from Europe and Asia are up 20% and 19% respectively so far this year.

• A slowdown in the US market was offset by strong growth in international markets over the last year for cruise operator Norwegian Cruise Line. NCL will look to other markets, including the UK, to make up the shortfall, but international deployments in China, south America, the Middle East and Australasia has grown non-US markets.

• The earlier May bank holiday and a later half term contributed to a 0.8% fall to 6.2 million in the number of passengers at Heathrow in May. The drop was not enough to stop the airport hub from reporting 1% growth in passenger levels in the year to date as it competes against rival Gatwick to win government approval for expansion.

• Ryanair will sell accommodation including hotels, hostels, and villas under its own brand from October which will offer ‘the lowest possible prices for customers’. The airline yesterday announced the launch of Ryanair Rooms, which will operate alongside Ryanair Car Hire on its website. Chief marketing officer Kenny Jacobs said: ‘More and more customers are looking to Ryanair for products other than flights, and we see this as a natural progression towards Ryanair.com becoming the Amazon of air travel.’

• Business travel is outperforming the overall UK economy so far in 2016, according to data from the GTMC, with rail travel the fastest growing sector. Transactions have increased by 6% here, compared to a 2% year-on-year rise in air travel, leaving GTMC ‘cautiously positive for business travel transactions this year.’

OTHER LEISURE:

• Viacom is still moving to sell a minority stake in its Paramount film unit despite objections from 93-year old Sumner Redstone.

FINANCE & MARKETS:

• The return on 10yr UK gilts (and on German bunds) has fallen to record lows. 10yr UK yields are now below 1.25%.

• UK trade deficit narrows in April after exports rose sharply to a 3yr high.

• The European Central Bank president has warned that the Eurozone needs more action from governments and deeper structural reforms if it is to return to previous levels of growth.

• Brexit. Tony Blair & John Major have said that a vote to leave the EU could harm the Northern Ireland peace process.

• Brexit. Voter deadline extended, young people (bremainers) flock to register.

• Brexit. NIESR warns low income families could see their benefits cut if the UK leaves the EU.

• Brexit. Despite the polls, betting is still 75:25. Langton is going with the money. We will not be leaving the EU.

• Brexit. Paddy Power Betfair shifts odds on a bremain vote to 78%. Earlier in the week it was registering 72%.

• World markets: UK and Europe down yesterday. US also lower & Far East down in Friday trade

• Oil price off the top a little. Brent Crude trading at around $51.85 per barrel

• The European Central Bank’s president has warned that Europe is at risk of suffering permanent damage from weak productivity and low growth. Draghi also argues that monetary policy alone is not a cure for the eurozone’s economic problems. The region grew by just 1.6% in 2015, and much of that was driven by the ECB’s stimulus. Some expect growth to flat-line in coming years.

• New data shows the number of Americans filing for unemployment benefits fell last week, while inventories recorded their biggest increase in 10 months in April.

Retail Roundup from Nick Bubb:

Sainsbury’s: After yesterday’s improved trading update from Argos, Sainsbury has announced that that the excellent CFO John Rogers will be stepping down, to take on the CEO role he craves…as CEO of Argos (replacing John Walden after completion of the deal in the autumn)! That means a promotion for John Roger’s No 2, Ed Barker, who is Sainsbury’s Group Finance Director. And as John Rogers was very much seen as the architect of the deal to bid for Argos, the City will respect the move.

Today’s Press and News: With Ocado, SCS and Home Retail in focus on the Retail beat yesterday, plus a management reshuffle at Boots, there is again plenty for the papers to talk about, but the main focus continues to be on the Parliamentary inquiry into the collapse of BHS and the Telegraph flags that “Green’s inner circle is to be questioned by MPs over collapse of BHS” (including Richard Caring), whilst Philip Green will no doubt be calling the Editor of the Daily Mail, after today’s front page shouts “Strip “Sir” Shirty of his title!”, with an unflattering photo of a haggard-looking Philip Green and a follow-up analysis by the City Editor headlined “Frankly, the whole affair stinks”…

Trade Press:
The front cover of Drapers magazine today is a feature on the fashion brand Replay, but the Editor focused on the demise of BHS and Austin Reed in her column and thundered that “Neither BHS nor Austin Reed had a clear idea of its brand, what it should sell and who should be buying it”. In terms of news stories, Drapers flags that the collapse of BHS could be the “final nail in the coffin” for some clothing manufacturers, New Look will open its first German store this autumn following a period of strong international growth and Matalan’s EBITDA dropped by 44% to £ 56m for y/e February (after operational challenges at its distribution centre in Knowsley). The front cover of Retail Week magazine features a photo of the beleaguered Mike Ashley in his warehouse at Shirebrook, with the headline “The buck stops with me”, flagging that the
under-pressure Ashley has admitted to “unacceptable” pay practices at Sports Direct. RW also has features on the retailers creating great customer experiences, a survey of staff costs to sales ratios, a profile of David Walmsley (the new Online guru at House of Fraser) and a review of the new Stradivarius flagship store at Oxford Street.

News Flow Next Week:
The continuing Parliamentary inquiry into BHS will get even more attention next week, when the former “king of the High Street” Philip Green appears before MPs on Wednesday morning…but there is plenty of other stuff going on next week, as Euro 2016 continues in France. The BRC-Springboard Footfall Monitor for May is out first thing on Monday morning. The Ted Baker AGM update           is on Tuesday, whilst the reclusive Simon Wolfson of Next appears on Wednesday evening in London to give the prestigious BRC Annual Lecture. Thursday then brings the ONS Retail Sales figures for May, the Poundland finals, the Darty finals and the N Brown Q1 update. And on Friday B&M are taking analysts to Germany to visit their business there, whilst JD Sports will give a trading update ahead of its AGM. Nick Bubb –
nicholas_bubb@hotmail.com

Yester-tweet – Yesterday in a Nutshell: Live Tweets on Website:

Some of the early tweets:

• Tesco is reportedly close to confirming the sale of its restaurant chain, Giraffe, to Boparan Ventures, owners of the Harry Ramsden chain

• The price of wholesale milk has continued to slip. This will leave more money in consumers’ pockets. That is unless the supermarkets snaffle the margin.

• Lower milk price helpful for companies such as Premier Foods as it is the group’s single largest input cost.

• The UK’s illicit cigarette trade grew by over 6% to account for 16% of total consumption in 2015, according to findings from KPMG

• All Leisure AGM sees delisting resolution passed, shares will cease to trade from end of business 15 June

• London’s hotel industry is projected to experience performance declines in 2016, but positive figures in 2017, according to STR

• London has posted year-over-year growth in revenue per available room (RevPAR) since 2010 but there are reports it may have peaked

• Nielsen’s 360° Gaming Report suggests more than half of the population in the world’s industrialised countries now identifies as gamers

• UK manufacturing output grew at its fastest pace for nearly four years in April, up 2.3% and outperforming wider output growth of 2%

• Oil price strong, Brent Crude trading at around $52.70 per barrel. Price almost doubled in 3mths.

• NIESR says that UK GDP should have grown by 0.5% over the March to May period. It estimates Feb-Apr GDP at +0.4%.

• Hoseasons is calling 2016 the ‘year of the short break’ after a 16% jump in short break bookings year-on-year for the self-catering specialist.

Other Tweets:

• Oil price has doubled in little more than 5mths, that’s really rather a large move. Travel stocks giving ground. Terrorism doesn’t help

• Oil price +100% in 5mths, hog, corn, OJ, soybean & sugar prices up 8%, 22%, 36%, 29% & 76% respectively. Inflationary pressures building?

• Twas ever thus. WH Smith down on the High Street, up across its travel hubs. Helps support SSP price. High Street, not so much.

• So where will all of that BHS square footage go? Who wants dept. stores in the 21st century. Indoor street food markets too revolutionary?

• 11,002 BHS players. Your starter for ten. Sort them out between the innocent (or the beleaguered) and, well, the not-so-innocent.

• AO World (& disrupters in general). When do start-up losses stop being a thing? Could say same re exceptional costs & the tour operators

• According to FT more than £50bn, yes, £50bn’s worth of prime homes are being developed in central London – http://tinyurl.com/zqwnfgy