Langton Capital – 2017-05-31 – Pret, PizzaExpress, Wagamama & Late Night Levies…
Pret, PizzaExpress, Wagamama & Late Night Levies:
A DAY IN THE LIFE:
Part of Langton is on the beach this week. The daily e-mail will still go out but in a shortened format:
PUB, RESTAURANT & DRINK PRODUCERS:
The SNP says in its 2017 Westminster manifesto that it will continue to support minimum unit pricing, although it wants a review of taxation to ‘better reflect alcohol content’. BBPA and SBPA Chief Executive Brigid Simmonds, commented: ‘Even though alcohol duties are reserved to Westminster, we don’t support shifting the alcohol tax burden to disadvantage lower-strength drinks, such as beer. Brewing and pubs support 58,000 jobs in Scotland. Furthermore, no other EU country taxes alcohol in this way, and the UK tax regime already places a higher burden on beer, relative to stronger drinks, than the tax systems of other EU countries.’
Following the London Mayor’s consultation on Culture and the Night Time Economy, the ALMR has recommended against Late Night Levies in the capital. The trade body also suggests the ‘Agent of Change’ principle should become the norm in planning decisions and that it should be up to residential developments to protect residents against noise disturbance from existing businesses.
Richard Hodgson has resigned as chief executive of 500-strong PizzaExpress, citing ‘personal reasons’, after joining the global pizza chain in 2013. Hodgson oversaw the group’s acquisition by Chinese private equity firm Hony Capital for c£900m, which has since enabled faster expansion in overseas markets including China and the UAE. It is thought he will be replaced by the group’s current chairman Jinlong Wang.
Former M&B MD Kevin Todd is advising on the UK launch of Which Wich, the US-based sandwich concept. Brothers Rami and Nader Awada of AAA Investment House Group have signed a master franchise agreement to launch Which Wich in the UK and the first location is set to open in London by the end of this year. Further expansion throughout the UK is possible after the opening of the first 10 London locations, and Which Wich plans to eventually operates 100 new sites in Europe by 2027.
Duke Street-backed Wagamama has secured a site in Milan — it’s first in a series of planned openings across Italy. The Asian noodle chain has also recently opened in Madrid, Bulgaria, and Bergamo in Italy, with three sites set to open in Madrid later this year.
Nottingham’s Castle Rock Brewery is hosting a 40th anniversary beer festival from today until Saturday 3 June.
Derby Brewing remains open today for over-funding.
Hervé Grandeau, chairman of the Federation of the Fine Wines of Bordeaux, has estimated that wine prices could rise by 10-20% in 2017 as a result of the April frosts.
Bordeaux production to fall, prices to rise.
Pret A Manger’s debt rose from £577.4m to £608m last year after a refinancing, as the chain gears up for a stock market listing in New York. Pret now has 440 stores (72 of which are in America) and has recently restructured its capital profile, which saw it earn a consolidated pre-tax loss of £16.2m last year. Sales were healthy, however, with like-for-likes up 4.8% and underlying earnings growing 10.6% to £93.2m on the back of a 14% jump in revenue to £776.2m.
HOLIDAYS, LEISURE TRAVEL & HOTEL
InterContinental Hotels Group (IHG) has announced the opening of Hotel Indigo Warsaw on Nowy Swiat, one of the main thoroughfares of the city. The hotel consists of 60 guestrooms with high ceilings and spa-inspired bathrooms. There are currently 21 Hotel Indigo properties in Europe and a further 18 in the pipeline.
Alex Cruz, chief executive of BA, has said he is ‘profusely sorry’ about the IT meltdown over the weekend as 200 flights at Heathrow were cancelled on Sunday. Cruz stated that he would not resign over the incident which was caused by a power outage, affecting 75,000 customers.
Ryanair’s FY profits increased by 6% to €1.3bn, with ‘record traffic’ of 120m passengers (up 13%) for the year up to March 31 2017. Chief executive, Michael O’Leary said the figures were achieved ‘despite difficult trading conditions caused by a series of security events at European cities, a switch of charter capacity from North Africa, Turkey and Egypt to mainland Europe, and a sharp decline in sterling following the June 2016 Brexit vote.’
Stuart Leven, chairman of Clia, has said Brexit would impact the cruise industry in three ways. The first and second being the freedom of guests and staff to cross borders. Mr Leven said the third impact would be ‘in what we charge because there is the customs union that allows us to take goods on ships from one country to the next without charge or taxation.’
A report by HotStats has found that in key European hotel markets profit levels have not grown since 2007, in a number of locations. Cities such as Prague, Berlin and Paris have faced large cost increases, due to factors such as increasing payroll and high commission demanded by OTAs. However, the report also found that some markets have thrived, such as Dublin which recorded a 218% growth in profit per room in the last decade.
PPHE Hotel Group Limited has announced that its 77.09% owned subsidiary, Arena Hospitality Group, has been successfully floated on the Croatian stock market, raising the group €105,820,493.
Manchester’s Victoria Station has has reopened after being shut for a week after following the attack at the MEN arena.
Brexit could affect cruise prices, Clia chairman Stuart Leven has said.
US reported still to be considering a laptop ban.
Tourist arrivals in Turkey reported to be rising.
Stride Gaming reports FY numbers. Announces ‘strong organic growth from Real Money Gaming, strengthened by the FY2016 acquisitions’.
IFS reports neither the Conservatives nor Labour are being honest with voters about the economic consequences of their policy proposals.
Retirement age could rise to 70 reports World Economic Forum.
US economic growth for Q1 revised upwards.
Imbiba has invested a seven-figure sum in the family-focussed private members’ club, Purple Dragon, which will fund the group’s second site in Putney as well as a wider rollout. Purple Dragon is considering locations in Notting Hill, Marylebone and Islington and is also working on international targets including New York and Dubai.
Hollywood Bowl has rebranded its Portsmouth centre to fit the company’s Americana theme, investing £750,000 into the site. CEO, Steve Burns, said ‘Portsmouth is the fifth Bowlplex centre to be rebranded to Hollywood Bowl, since our acquisition of the 11 centres, last year.’
Sportech has been granted a licence by the Gambling Commission and will now be allowed to complete the transaction before the end of June 2017. Ian Penrose, Chief Executive, of Sportech said: ‘This is a significant step towards completion of this transaction. I would like to thank the dedicated management, staff and customers who have enhanced the history and success of the Football Pools. I wish them all continued success.’
Ctrl Me Robots has been acquired by Snap Inc. for $1m, with the instant messaging service thought to be focusing on drone technology in a bid to capture aerial footage.
Alibaba is reported to be raising $1bn in funding for Chinese food delivery startup Ele.me, valuing the startup at $5.5bn-$6bn.
RETAIL NEWS WITH NICK BUBB:
Tesco/Booker: At 12 o’clock yesterday the hard-working CMA blandly announced that it has begun the first phase of the investigation into the Tesco/Booker deal, running until 25 July 2017: “During this period, the Competition and Markets Authority (CMA) will assess whether the deal could reduce competition and choice for shoppers and other customers, such as stores currently supplied by Booker. After this first phase, the merger will either be cleared or, if the CMA identifies a potential reduction in competition, it will be referred for an in-depth Phase 2 investigation lasting up to 24 weeks”. At 12.08pm Tesco shed more light on the subject by saying “Following constructive engagement with the Competition and Markets Authority (CMA) since our announcement on 27 January 2017, Tesco is pleased to confirm that it has today filed a formal notification with the CMA in respect of its
GFK Consumer Confidence Index for May: The overnight GfK Consumer Confidence Index was up by two points in May to minus five (against a City forecast of -8), even though inflation has hit household spending and wages are failing to keep up with the cost of living. Joe Staton, the Head of Market Dynamics at GfK, said that consumer confidence had shown an “unexpected uptick”. “Consumers report increased confidence in their personal financial situation, the wider economy, and future plans for shopping and saving,” he said, but he also warned that the “real squeeze” in living standards may be “yet to hit home”. Polling was done between May 1st and 15th, so it did not capture more recent gloom about the UK economic outlook post-Election.
Today’s Press and News: The big Retail news is that the wretched CMA has belatedly begun its investigation of the planned Tesco/Booker merger (on the very day, ironically, that the trial of the UK Tesco executives accused of cooking the Tesco UK accounts began at Southwark Crown Court), but there are some interesting front page headlines: the FT leads with “US shoppers put economy back on course to lead global recovery”, whilst the sensational Times lead is “Shock poll predicts Tory losses”…
News Flow This Week: After the Bank Holiday on Monday, there is no company news scheduled this week, with the end of May fast approaching…but the latest Kantar/Nielsen monthly grocery market share data should be out at 8am.