A Day in the Life:

Langton is on hols this week so there’s something of a skeleton email going out & there won’t be a full ‘Day in the Life’ until next week.

Friday’s email was delayed due to the paucity of internet, WIFI and mobile reception in Northern Germany. Slightly annoying but life goes on. Here’s the news:

The News:

PUB, RESTAURANT & DRINKS PRODUCER NEWS:

• Shepherd Neame is to launch a Spitfire lager. It reports it is 80yrs since the Spitfire’s first flight in 1936.

• Pret is to operate a vegetarian only unit in Soho on a 1mth trial basis.

• McDonald’s has said that it needs to ‘earn the right’ to move up the pricing ladder in due course.

• The Pub Governing Body has said that it will continue to offer advice to licensees post the introduction of the pubs Statutory Code. Sir Peter Luff, Chairman of the Pub Governing Body reports ‘the PGB still has a vital role to play, as the industry enters a new phase. Companies with fewer than 500 tied pubs will not be covered by the statutory code and it is essential that options for licensees to settle disputes quickly still exist.’ He adds ‘so while the landscape of licensed hospitality is evolving, we will remain on hand to provide speedy and affordable dispute resolution for tenants and lessees.’

• Corney & Barrow is to introduce a new wine & book club.

• Enterprise Inns Thursday bought back 76,525 shares for cancellation at around 97p

• Starbucks is to introduce Nitro Cold Brew in US cities this summer

• MCA reports that US based MOD Pizza will open its 2nd site in the UK in Brighton later this year

• Honest Burger has secured 2 further London sites reports the MCA.

LEISURE TRAVEL:

• RCL has entered into an agreement to sell its Legend of the Seas vessel to Thomson Cruises in spring next year

• Paris metro workers went on strike yesterday to add to the misery being caused by rail and port workers.

OTHER LEISURE:

• Goals Soccer has announced that it is to raise £16.75m via the placing of new shares at 100p in order to fund new sites.

• Goals says has completed strategic review, says has ‘developed a detailed strategic plan for the Group going forward’. Goals recently announced that Mark Jones was to join as CEO.

• Goals aims to 1) grow and innovate in the UK, 2) develop new capabilities, 3) expand internationally and 4) unlock its underlying asset potential. The group says ‘the directors consider the Placing to be in the best interests of the Company and its Shareholders as a whole. Accordingly, the Directors unanimously recommend Shareholders to vote in favour of the Resolution to be proposed at the General Meeting as they intend to do in respect of their own beneficial holdings amounting, in aggregate, to 5,442,201 existing Ordinary Shares, representing approximately 9.31 per cent. of the current issued share capital.’

• Goals is to commit £3.5m to ‘an arena modernisation catch-up programme’, £7.9m to a clubhouse refurbishment programme and £2.6m to a US pilot site.

• Re current trading, Goals says ‘the Company announced on 5 May 2016 that like-for-like sales for the first 18 weeks of the year were marginally negative compared to minus 12 per cent. like-for-like UK sales growth experienced in H2 2015. The Board can now report that trading for the first 21 weeks is tracking that same improved trend with like-for-like sales marginally negative.’

FINANCE & MARKETS:

• World markets. UK mixed on Thursday, Europe & US up. Far East up in Friday trading.

• Brent crude trading around $50.

• UK construction PMI eased to 51.2 in May from 52.0 in April

• ECB keeps rates on hold. Raises its inflation outlook (marginally) from 0.2% to 0.1%.

Retail Roundup from Nick Bubb:

BHS:
The final collapse of BHS is not surprising, in the sense that the Portuguese consortium supposedly looking at BHS at the last-minute was barely any more credible than the clowns at Retail Acquisitions, so the writing was on the wall a few days ago. What is surprising is that there seemed to be such interest in BHS a few weeks ago, with the administrators trumpeting about 4/5 serious contenders, but it’s obvious now that they were just scavengers trying to get parts of it on the cheap. Some people will miss the BHS lighting departments and some (old) people will miss the BHS cafes and some people will miss the tacky BHS Xmas gift shop, but there are other lighting shops and cafes and tacky gift shops in the High Street. The big beneficiary of BHS’s closure will be the chain that has done the most in recent years to put BHS out of business and that is Primark.

Today’s Press and News:
There is saturation coverage of the news that BHS will finally be broken up, with 11,000 jobs at risk, after yesterday’s news that the administrators (who bemoaned the “seismic shifts” in the High Street) had failed to secure a buyer for the whole chain, with Philip Green’s PR spokesmen saying that he was “saddened and disappointed” by the news. The Business editorial in the Telegraph thunders that “BHS was a case study in how not to be a retailer in the 21st century”, whilst the Daily Mail’s City Editor fulminates about the “vultures who skinned BHS” and the Business editorial in the Guardian says that Philip Green and Dominic Chappell “deserve a kicking” from MP’s when they appear at the inquiry. On a more sober note, the Times flags that “BHS was never viable as a 160 store
portfolio” and the FT looks back as “Shutters go down on a British institution”.

Weather Watch:
With the suddenly winter-like conditions now prevailing in London, Fashion retailers will be bemoaning their fate…but memories about “the weather” are notoriously short-term, so, ahead of Tuesday’s BRC-KPMG Retail Sales survey for May, we turned to the Retail weather consultants Planalytics for their regular monthly overview of how last month’s weather “should” have affected the High Street. And the headline for May this year was “Finally a warm up for spring: Warmer temperatures deliver stronger demand”, flagging that the overall average temperature of 11.8 degrees C in May was 0.2 degrees above “normal” and 1.3 degrees higher than last year. After an extremely cool April, the warm up in May came as a welcome relief to both retailers and consumers. In Outdoor Living, “Weather driven sales” were up by 32%
and DIY retailers and garden centres should have had a strong month for seasonal products and made up some of their April losses. But with Half-Term week being very cold and grey, to kick off June on a poor note, Planalytics flag that retailers will be looking forward to the warm-up promised for this weekend!

John Lewis Partnership Sales Watch: After a reasonably good May, last week’s trading was distorted by the later calendar fall of the Bank Holiday and skool half term this year. At John Lewis, w/e May 28th saw overall gross sales down by 1.6% on last year (down nearly 3% “LFL”), with all three main product areas down a bit. Over the last 17 weeks John Lewis sales are now running up by 5.2% (c3.5% up LFL), with Electricals up by 9%, but we will have to see how this week turns out to judge the real trend. Over at Waitrose, sales over the last 17 weeks are now up by 2.8% gross (up a tad LFL), after a good-looking 7.2% increase in gross sales last week, but against the equivalent Bank Holiday week last year sales were only up by 3.7%, so this week will be a bit more down-to-earth.

DO High Street Sales Tracker: The BDO High Street Sales Tracker for w/e Sunday May 29th reports that the moderately spring-like weather failed to boost trading, with Fashion store LFL sales down by as much as 8.3% on last year, its weakest result in five weeks. Overall Store LFL sales were down 6.5% (including Homewares and Lifestyle sales) and total Online sales growth was only 10.3%.

Trade Press:
It is the turn of Drapers magazine not to be published today, “because of the Bank Holiday”, but Retail Week has been published, although its front page fails to keep up with the fast-moving BHS story, with a headline “Beyond borders: The global giants snapping up UK and European retailers” beneath photos of the shop fascias of House of Fraser, Dreams and Whistles (?). RW also has features on how M&S’s new CEO aims to reshape the business and how Facebook plans to up retailers’ in-store and Online offers. In terms of recent stories, RW focuses on the stories that Mike Ashley will shun the MP’s inquiry and that the closure of Austin Reed will cost 1000 jobs, although it also flags that B&M’s CEO Simon Arora has defended the LFL sales slowdown. Finally, the Editor’s column looks at the appointment of Sergio Bucher and
thunders that “New chief Bucher must reignite staid Debenhams” and “…it would be too soon to write off Debenhams yet”.

News Flow Next Week: After the collapse of BHS rescue efforts yesterday, the continuing Parliamentary inquiry into BHS will get even more attention next week…but there is plenty of other stuff going on. A busy week kicks off with the BRC-KPMG Retail Sales for May on Tuesday morning. Wednesday then brings the Shoe Zone interims, the AO World finals and the Sainsbury Q1, with the Home Retail (Argos) Q1 following on Thursday. On Friday we get the Bonmarche finals and…the start of Euro 2016 (not that England’s dismal performance against Portugal in last night’s friendly would fill anyone with great hope about our chances…).

M&S Watch: Poor old Steve Rowe has had a bad week, what with his beloved Millwall losing out in the Premiership playoff, his decision to axe “muzak” in the stores getting a bad press and the M&S share price continuing to collapse (it is now over 20% down since the results)…On top of that, our spies tell us that the M&S Food Hall in the basement of the Marble Arch flagship store was out of action yesterday afternoon, because of a power failure with its chiller cabinets…Incidentally, we popped in to the front entrance of the store on Oxford Street the other day and were still amazed that all the signage in Womenswear is about the sub-brands of Per Una, Autograph etc…

Hema Watch: We are big fans of the cheese biscuit snacks in the Dutch discount convenience store Hema and were interested to see recently that they have a store in the impressive airside “shopping centre” at Stansted Airport. Well, expansion continues and on Wednesday Hema unveiled its sixth UK store, in Hammersmith Broadway shopping centre (to add to the other ones in Kingston, Victoria Place, Bromley and Birmingham New Street Station). Nick Bubb – nicholas_bubb@hotmail.com

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

Some of the early tweets – not many, brings it home how quiet it is:

• Bloomberg has reported that the US Justice Department is set to approve AB InBev takeover of SAB Miller later this month

• Carluccio tells MCA it is considering multiple trading formats for the business going forward.

• Casual Dining Group shuffles senior team & moves James Spragg to newly-created role of COO

• EasyCoffee is opening a new store in Leicester Square.

• JD Wetherspoon chairman Tim Martin has issued 200k beer mats featuring a call for the UK to leave the EU.

• New research has suggested that Brexit could cost the UK’s tourism industry around £4.1bn in lost income per annum

• STR says there has been a shift towards new construction in the hotel industry

• Rate of UK house price inflation slows. Prices up 4.7% in year to May vs 4.9% in year to April & 5.7% in year to March.