Langton Capital – 2018-09-12 – Delivery, street food, Morrison’s, London hotels & other:
Delivery, street food, Morrison’s, London hotels & other:
A DAY IN THE LIFE:
Meetings and prep for meetings to be getting on with so we’ll move straight on to the news:
PUBS & RESTAURANTS:
• Delivery considerations. May not be a good idea, over time, to give away (and perhaps subsequently lose) customer information. Own label restaurants can’t be too far away. There are plenty of Dark Kitchens already.
• Subway in the US now intends to remodel (or rather encourage its franchisees to remodel) up to 9,000 stores per annum for the next five years. Refurbs may cost between $90k and $100k. Less than 500 have been achieved in the last 12 months per NRN.
• Kerb is to leave Camden market after two years. The street food coordinator writes ‘after two fantastic years, we will be leaving Camden Market West Yard, as of 1st October 2018.’ Kerb says ‘we have loved our time at Camden and are proud of the transformation that we have driven; developed over 30 new street food businesses, re-designed the market, overhauled quality and hygiene, animated the canal area, and now it is time for us to move on to new projects in the capital.’
• Kerb says ‘our mission is to animate spaces, in collaboration with partners who share our vision for the future of street food and that’s what’s next for us and our traders; more amazing locations, the best quality street food and nurturing our traders’ businesses to flourish. Watch this space for the announcement of new London locations’.
• Morrison’s has reported H1 numbers to 5 Aug saying that LfL sales ex-fuel were +4.9% in the period.
• MRW total revenue +4.5% at £8.8bn with underlying PBT +9.0% and EPS +8.5% at 6.28p. H1 dividend +11.4% at 1.95p. Chairman Andrew Higginson comments ‘with each passing quarter, the Morrisons team is building a better and better business.’
• CEO David Potts reports ‘strong growth, including our best quarterly like-for-like sales for nearly a decade, together with another special dividend for our shareholders, shows how new Morrisons can keep improving for all stakeholders.’
• Mr Potts says ‘Morrisons continues to become broader, stronger and a more popular and accessible brand, and I am confident that our exceptional team of food makers and shopkeepers can keep driving the turnaround at pace.’ Re the outlook, he says ‘we are confident that Morrisons has many meaningful and sustainable sales and profit growth opportunities ahead.’
• China is now the world’s largest e-commerce market for alcoholic beverages, valued at $6.1bn or four times the size of that of the US, data from IWSR has indicated.
• Hi-Spirits will bring some of its biggest brands together during London’s Cocktail Week celebrations.
• Deliveroo has expanded into Asia, announcing plans to launch in Taiwan over the coming weeks.
• A new report into the purchase of energy efficient catering equipment shows that cost is still the biggest barrier for an industry that ‘buys mainly on price’. Around 50% of those interviewed for the ‘Equipped for the Future’ report, published by Footprint Intelligence and Hoshizaki, cited price as a primary consideration when purchasing equipment.
• Jagermeister and Courvoisier are the latest brands to be ditched by JD Wetherspoon as it moves away from EU products.
• JD Wetherspoon is cutting all prices by 7.5% today to highlight the 20% VAT tax the hospitality industry has to pay on all food and alcohol that gives supermarkets an unfair edge on prices.
• UK-based cider maker Thatchers Cider plans to invest £14m to expand the production capacity of cider at its Myrtle Farm site.
• Beef burgers have increased their share of the food to go dinner sector, taking a 14.2% stake the MCA has reported.
• The National Association of Cider Makers has stated that the government needs to base their policy on factual evidence and not ‘misinformation’. Gordon Johncox, CEO of Aston Manor commented: ‘While we all work well together, we can struggle when we are singled out unfairly. Sometimes it’s hard not to feel under siege when time and again fingers are pointed at the cider category in isolation.’.
• Flight Club, the social darts concept, has received £15m of new growth funding as it looks to expand its core brand and launch a new concept called Electric Shuffle, the MCA has reported.
• Over 250 free-to-use cash machines are closing every month as operators shut unprofitable ones. There are 53,000 free machines in the UK – but the number is shrinking at a record rate as people use less cash.
• PayPal offers instant payouts to the 19.5m businesses that use its platform through the launch of its new Funds Now mechanic. Funds Now follows the launch of similar technology by Stripe.
HOLIDAYS & LEISURE TRAVEL
• CEO of Thomas Cook, Peter Fankhauser, said on Tuesday that ‘many questions are still not answered’ in relation to the deaths of two Brits in a hotel room in Egypt in August.
• STR has announced preliminary August 2018 data for London’s hotel industry showing occupancy up 5.6% to 86.8%, with ADR up 2.5% to £145.45 and RevPAR climbing 8.2% to £126.29.
• Ryanair’s chief executive, Michael O’Leary, reiterated concerns that flights between Britain and Europe could become grounded for days in the wake of Britain’s exit from the European Union next March. Mr. O’Leary said ‘Flights to and from Europe will be stopped in a hard deal Brexit. There is no assurance’.
• Abta believes holiday sickness claims made against tour operators will fall due to the government ban on cold calls, which came into force over the weekend. Now, companies making such calls have to ensure they have the recipient’s permission before the conversation. Fines for breaching the rules could be as high as £500,000.
• Premiership Rugby has rejected CVC Capital’s £275m bid, with clubs open to further offers but not willing to cede control of more than 50% of the tournament.
FINANCE & ECONOMICS:
• Sterling little changed at $1.304 and €1.1218
• Oil virtually unchanged at $79.28
• UK 10yr gilt yield down 1bp at 1.49%.
• World markets all up.
• Brexit etc.:
o Brexit Secretary Dominic Raab has said Britain will not pay its £39bn divorce bill if it is unable to agree a deal. Mr Raab tells the Telegraph the UK ‘would not pay the terms of the financial settlement’ in the event of no agreement.
o Jean Claude Juncker has said that ‘we also ask the British government to understand that someone who leaves the union cannot be in the same privileged position as a member state.’
o Phone roaming charges could return in the event of no-deal reports Sky.
PRIOR DAYS LATER TWEETS:
• Later tweets: Delivery companies charging more to small operators, more still to street food vendors. Up to 35%. Who let the fox in the hen house?
• Shadow chancellor John McDonnell has pledged Labour will ‘restore the balance of power in the workplace’ re Gig Economy
• Brexit. Optimism a deal will be done, pessimism that it will be worse than hoped. Boris says better to stay in than leave under Chequers’ plan
• JP Morgan, Jaguar Land Rover warn on job losses & costs. Benefit from Brexit claims labelled Project Fantasy by Chuka Umunna
• Debenhams accused of opportunistic CVA scare leaking. Too good to miss? Some may bag CVAs with others increasingly envious??
START THE DAY WITH A SONG:
Yesterday’s song was Wolf Like Me by Tv On The Radio. Today who sang:
There goes the charabang,
Looks like I’m gonna be stuck here the whole summer
Well, what a bummer
RETAIL NEWS WITH NICK BUBB:
• Nick it taking a well-earned break.