Langton Capital – 2016-05-26 – Sugar, Hostelworld, overseas visitor numbers & other:
A Day in the Life:
Problems with a virus this morning, email a little late. Do not open a 7am email from Langton with a PDF attachment & no text.
So in addition to the various brambles and elderberry shrubs that we have growing wild all over the garden, we have a large number of blackcurrant bushes that seem to be growing from seed.
And you could go all warm and gooey about that and suggest that it’s nature’s way of keeping us fed or you could take it for what it is, proof that various birds have been stealing my blackcurrants from the plants that I have bought and nurtured and have then been failing to digest said seeds but have rather pooed what remains of them out in their ongoing efforts to make our garden into one of the largest open-air bird toilets in the world.
So I’ve tried reasoning with them.
I’ve put up bits of fluttery cloth (they are ignored and, indeed, end up covered in purple bird poo) and I’ve shouted at them and even tried to set the dog on them but, in their quest to find sufficient calories to remain alive, they’re deaf to my entreaties leaving us to eat shop-bought pies whilst surrounded by about a billion, semi-digested pips.
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RECENT WEBSITE ARTICLES:
• New article. Recent market entrants causing a headache? See here
• Market getting tougher? See here
• Main features London hotels, slowing markets, Restaurant Group etc. Link to index page – here
• Ongoing tweets found – here
PUB, RESTAURANT & DRINKS PRODUCER NEWS:
• The head of Coca-Cola UK & Ireland has criticised George Osborne’s sugar tax, saying it will not work and will hit the poorest hardest. Writing in The Daily Telegraph, Jon Woods, the general manager of Coca-Cola UK & Ireland, warned that the new levy, which the Treasury estimates could bring in £520m in its first year, will ‘also hit consumers in the pocket regardless of what they drink,’.
• Pure, the healthy food-to-go concept 49%-owned by Whitbread, generated £1m on over £10m of turnover for the year to end-2015. Like-for-like sales across the eight-strong group increased by 14% and the positive trading momentum has continued into the new year as the group capitalises on Whitbread’s £6.8m investment.
• Grand Union revenue grew by 11.4% to £8.1m for the year to 26 March 2016, with all units showing ‘strong like-for-like growth’ as site EBITDA hit £1.5m (+21%). Chairman Luke Johnson commented that the group’s new Trade Union concept could be ‘a transformative step for the business’, while founder Adam Marshall said that trading in the early part of the current financial year has been encouraging.
• New figures from an NHS Scotland report show Scottish alcohol sales rose last year to the equivalent of 41 bottles of vodka per adult. The Scottish sales were 20% higher than in England and Wales following a surge in off-trade sales. Ministers are using the report to support their case for minimum pricing.
• The number of complaints about payday loan companies jumped by 178% in the year to March, the Financial Ombudsman has revealed. The rise comes despite new controls on lenders being brought in by the regulator.
• Overseas visitors to UK? How many of the top 10 countries can you name? This by number not spend. Answer below
• Hostelworld Group updates on trading at AGM, cautions on impact of geo-political events.
• Hostelworld says ‘reflecting recent geo-political events, particularly in Europe, trading over Q2 has been at a level below our expectations’. It says ‘whilst during this period Asia Pacific continued to be our fastest growing destination region, driven by hostellers’ travel preferences and our increased supply in that geography, bookings into higher priced European destinations have been weaker.’
• Hostelworld: Says ‘average booking value has been lower this year, reflecting the evolving geographic mix, the continued higher proportional growth in mobile bookings, which tend to be of shorter duration, and exchange rate movements, particularly in relation to GBP which is a key settlement currency for the Group. Our Elevate pricing programme, which attracts higher commissions, continues to grow in line with our expectations.’ Group says investment marketing will be below previous guidance. Says ‘Hostelworld will continue to actively respond to movements in demand, supply and pricing. The strength of our brand and technology, underpinned by a growing marketplace, gives the Board confidence in the Group’s future prospects.’
• VisitBritain has launched a domestic marketing campaign to inspire Brits to ‘holiday at home’.
• The US hotel industry is set to experience record-breaking room demand but low room rate growth during June through to August. A full supply pipeline will drive a 1.7% increase in the number of rooms, keeping occupancy growth at 0.4%. ‘Average-daily-rate growth, while still positive, is certainly not as strong as we first expected,’ said Jan Freitag, STR’s senior VP for lodging insights. ‘The ADR forecast for the summer currently stands at around +4%. We expect that muted macroeconomic growth will have a small, positive impact on employment and corporate profit numbers. With that growth should be the desire for the American public to travel and for managers to send their people on the road.’
• The European hotel industry saw a 3.5% rise in occupancy to 71.4%, as average daily rate grew to €109.54 and revenue per available room jumped 7.4% to €78.20.
• The European hotel industry recorded positive April 2016 results in the three key performance metrics when reported in euro constant currency, according to data from STR.
• Thomas Cook cabin crew voted in favour of a strike is a dispute over health and safety, with 74% of voters in favour of industrial action. Thomas Cook Airlines said plans are in place to make sure customers will still be able to go on holiday.
• The number of overseas package holidays being booked by UK residents is failing to keep pace with the overall leisure market. A 5.1% rise in package holiday sales to 16.7 million in 2015 lagged the growth in the total number of overseas breaks (up 9.4% to 42.2 million), according to ONS figures. Package holidays accounted for 39.6% of all international leisure trips last year – down from a 41.1% share of the market in 2014.
• Top 10 visitor numbers by country come from France
• Overseas visitors. Largest number of visitors don’t come from the biggest spending country. We’d suggest around 6-7 of the countries are self-evident – at least when you know who they are – but the others in the top 10 are a little more surprising.
• Some 36.5m overseas visitors visited the UK in 2016. Around 4.2m (11.5%) came from France, 3.3m (9.0%) from the USA (which was the biggest-spending country) and 3.2m (8.7%) came from Germany. Visitor numbers are set out below:
1. France 11.5%
2. USA – 9.0%
3. Germany – 8.7%
4. Spain – 6.0%
5. Poland – 4.7%
6. Canada – 4.7%
7. India – 1.2%
8. UAE – 1.0%
9. Brazil – 0.9%
10. China – 0.8%
The top 10 visitor countries accounted for only 46% of visitors. The number from China is the fastest growing.
FINANCE & MARKETS:
• World markets: UK & Europe higher yesterday. US also up but Far East down in Thursday trading
• Oil price breaches $50 for first time this year. Brent crude currently trading around 1/3 of a dollar higher at $50.05 per barrel. US crude inventories declined more than expected in the week to 20 May.
• German consumer confidence index unexpectedly higher this month. Germans just a shade less glum
Retail Roundup from Nick Bubb:
Debenhams: After months of speculation, Debenhams have finally announced that the new CEO is to be…Sergio Bucher, from Amazon Fashion. The Chairman Ian Cheshire says that “…with some exceptional quality candidates, Sergio’s wealth of e-commerce expertise, international experience and clear leadership qualities stood out”.
Yester-tweet – Yesterday in a Nutshell: Live Tweets on Website:
Some of the early tweets:
• GNK reports ‘Year-on-year, spend on Drinking Out is unchanged [in April].’ It suggests that underlying spend strong.
• GNK: Says that ‘over 1/3 of British football fans intend to watch at least one game of the European Championships in a pub this summer’
• The majority of UK GPs disagree with the UK chief medical officer’s statement that there is ‘no safe level of alcohol consumption’
• Thomas Cook’s Hotels4U brand has launched its bid to reclaim £ millions in VAT from the HMRC.
• David Cameron has warned that leaving the EU would push family holiday costs up by hundreds of pounds
• EasyHotel is expecting to add more than 1,000 rooms in the next two years. It is currently outperforming its markets
• GfK reports 32% drop in British holidaymakers to Turkey. Tunisia asks us to lift ban. Not going to happen.
• Bank of England governor Mark Carney has defended his comments on the EU referendum debate during the Treasury select committee.
• Eurozone finance ministers agree to extend further bailout loans to Greece & IFS has said that a Brexit could extend austerity by 2yrs
• The Office for National Statistics said borrowing in April exceeded expectations, coming in at £7.2bn versus forecasts of £6.6bn.
• No. of UK properties sold fell 45% between March & April as stamp duty changes came into effect, according to HMRC figures.
• Sterling stalled after diminished Brexit fears-based rally petered out. Too early to call trend but helpful for inbound tourism.
• Oil breaches $49 (again). Interestingly WTI price now a fraction ahead of Brent. Doesn’t happen very often, how can one trade that?
• Cranswick. Great Hull company but helped by lower hog prices. These now rising & rating a bit rich – agree http://tinyurl.com/jqo77np
• Financials v strong Tues as Brexit risk seeps out of share prices. Still a month to go. Need to agree on word, Brexin or Bremain?
• Dixons Carphone CEO ‘consumers are ready to spend but have rightly become more canny’. They crave deals.
• MKS profit warning a.k.a. strategy review. Says ‘sharpening prices…will have an adverse impact on profit in the short term’.
• MKS shares down 8%. Has apparently pencilled in 2hr analyst meeting. Lucky them. Will focus on why profit warning is not a profit warning
• Holidays. Turkey down 30-40%, Tunisia down 100% choice. Tunisian ambassador says we should fly again but that’s hardly compelling
• So why aren’t restaurant menus in the UK also in foreign languages? German, Spanish, now Russian abroad but here it’s English. Or English
• Thomas Cook is planning full marketing launch of JV with Fosun ‘autumn 2016’. This has the potential to be a very big deal.
• Langton takes a look at new entrants. Whether it’s hotels or restaurants, they’re a problem for incumbents – http://tinyurl.com/h4v6h5j
• Advert seen today: No solicitors, maintenance, no hassle, buy to let through crowd-funding. Risk x risk x risk, surely??