Langton Capital – 2018-10-29 – UK Exports, Home-Delivery, Pat Val, etc:
UK Exports, Home-Delivery, Pat Val, etc:
A DAY IN THE LIFE:
Well, the clocks have gone back and, as it’s dark at depressing-o’clock in the afternoon now, we can no longer kid ourselves that it’s still summer.
But that’s not all bad, surely.
We don’t have to cut the grass any more and we’ll be able to play with dangerous bonfires and unstable fireworks next weekend and the one after and then it’ll be Christmas before you know it, just you see.
Anyway, with a staggered half term meaning that it’s another heavy out-of-office week, let’s move on to the news:
PUBS & RESTAURANTS:
• Patisserie Holdings has announced that the company has accepted the resignation of the group’s Finance Director, Chris Marsh. This follows his suspension on 9 October 2018.
• The veteran restaurateur, David Scott, has stated his interest in a potential takeover bid for Patisserie Valerie, The Sunday Times has reported. David Scott, the former head of Druckers Vienna Patisserie, a Birmingham-based chain of cafes sold to Patisserie Valerie in 2007, said he had backing from a family-run private equity firm.
• Chief Executive of UKHospitality, Kate Nicholls has commented on Hackney Council’s revised statement of Licensing Policy: ‘We still have serious concerns about elements of the Council’s approach, particularly the core hours policy. We understand why residents of the borough have concerns about the problems this could cause businesses and investment in the area and why they feel the need to Judicially Review the policy’.
• Home delivered meals are on the up with 55% of consumers having ordered one in the last month, up from 40% last year, the MCA has reported.
• Tapas Brindisa is set to open a new restaurant at the Battersea Power Station development.
• Dunkin’ Donuts parent company,Dunkin’ Brands has reported profit up 61% to $66.1m. The group have accredited the strong growth in profitability to its change in strategy placing a greater emphasis on beverages and snacks.
• The UK hospitality sector has recorded annual turnover of £102bn, an increase of 4% on last year, according to data from the ONS. The sector has also been found to employ 2.35m people.
• English wines are leading British export growth to the US. Last year UK food and drink exports amounted to £22bn.
• Beds and Bars has recorded revenue up 5.3% to £52m for the year to 31 March 2018, with EBITDA climbing 13.3% to £5.3m.
• C&C Group, the Irish-based owner of Tennent’s lager and Magners, has announced that it may produce several European drinks at its Glasgow brewery post-Brexit. The group has also announced that it will launch its visitors centre at Wellpark Brewery in Glasgow on 22 November, and it be the UK’s biggest beer attraction.
• Joe & The Juice is believed to be considering an IPO in the US towards the end of 2019. The Copenhagen based chain currently has a valuation of around $1.5bn.
• The MCA reports that KerbEdge, a burger restaurant concept in the North East, has been ordered to wind up by the High Court.
• Fuller, Smith and Turner launches Vintage Ale, its annual limited edition, in bottles to be sold in Waitrose as well as Fuller’s Brewery Shop.
• Asda will begin consultations with staff that could see up to 2,500 jobs cut. The proposed merger between Sainsbury’s and Asda is still under enquiry by the CMA.
HOLIDAYS & LEISURE TRAVEL:
• easyHotel has confirmed that it has acquired a central freehold site in Bristol that will be developed into a 145-bedroom easyHotel, subject to planning permission. The hotel is set to open in 2020 and will cost c£12m to develop. The group also announced that they had received permission to progress with their 180-bedroom hotel in Oxford. Guy Parsons, CEO of easyHotel plc, said: ’Our investment in Bristol, the fifth since our fundraising in March marks the latest addition to our fast-growing portfolio of comfortable, stylish and highly affordable hotels in key tourist and business locations. The Group is also pleased to confirm that planning approval for the new easyHotel Oxford has been granted. Construction work is anticipated to start in the New Year’.
• Heathrow airport has seen a record 60.5m passengers so far in 2018, with revenues up 2.3% to £2,211m and adjusted EBITDA up 1.9% to £1,372m. The results support the decision to invest an additional £555m into the airport.
• Twitter reports Q3 adjusted earnings per share of 21 cents vs a projected 14 cents, sending its shares up strongly. Revenue rose to $758m compared to an expected $702.6m.
• Ten Entertainment has announced that Mark Willis, the group’s CFO is stepping down in order to join Pendragon. Chairman of the group Nick Basing commented: ‘Whist we are disappointed that Mark has decided to leave the Company, we respect his decision to join a much larger Company. The Board wishes to extend its gratitude to Mark for his hard work and contribution to Ten Entertainment’.
PRIOR DAY LATER TWEETS:
• Later tweets: Busy day for Pat Val yesterday. Winding up order gone, options incorrectly reported, Luke on board at Stonebeach
• CAKE CEO & CFO made profits of £4.5m on this-year share sales. Directors & family sold £42m of stock in IPO at 170p.
• GBK CVA has large number of recent restaurants to close. Co didn’t even tap the brake pedal, drove full pelt into brick wall
• GBK opened too many, too quickly. Add in ‘high rent, generic offer, discounting’ and we have today’s CVA becoming inevitable
• Markets steadying as the ‘drop from an edge or from a ledge’ debate continues. Will only all be clear with hindsight.
• ScS says its concession business in H of Fraser down by no less than 52%. What future the department store? Debenhams dumping 50 of them
• Debenhams’ upbeat comments on food sales, both own and concessions, suggests operators there are helping keep footfall up
• Does appointment of Luke J to board of Stonebeach mean search for smoking gun is narrowing? Looks like a good place to start
START THE DAY WITH A SONG:
Last Friday’s song was Please Mr Postman, originally by The Marvelettes, but famously covered by The Beatles and The Carpenters. Today who sang:
Will you recognize me?,
Call my name or walk on by
Rain keeps falling, rain keeps falling
RETAIL NEWS WITH NICK BUBB:
Saturday Press and News (1): The focus continued in the Saturday papers on the involvement of the beleaguered Philip Green in the #MeToo revelations in the Telegraph, with the Telegraph itself turning the spotlight on the role of the Chairman of the Arcadia holding company, Karren Brady (“Women’s champion Brady drawn into Green scandal”). The Daily Mail discovered that Philip Green is hiding away in a health spa in Arizona, of all places and also highlighted that his wife Tina is planning a £3m wedding for their daughter Chloe next year. The front page headline in the Guardian was “Green paid seven-figure sums to silence abuse allegations” and the Guardian also had a useful analysis of the pressures on the embattled Arcadia (“Scandal erupts as Green fights to shore up High Street empire”) and the similar FT article (“Claims nudge Green’s swaying empire”) also noted that
Saturday Press and News (2): Apart from all the Philip Green revelations, there was plenty of coverage of the big sell-off in tech stocks on global stockmarkets (“Tech gloom drags down Wall Street” was the front page FT headline) and the news that the Chancellor is planning to introduce some token relief (of up to £1.5bn) for small businesses and retailers on Business Rates in Monday’s Autumn Budget (the FT flagged that “Hammond aids “gap-toothed High Streets””, whilst the Telegraph went for “Hammond to heed High Street woes”).
Saturday Press and News (3): In other news, the Times flagged the renewed warning from Pendragon on Friday about the impact of the new EU emissions tests on sales of new cars, whilst the Times, the Telegraph and the Daily Mail all noted the news that Asda is planning to cut 2,500 store jobs. And the FT highlighted that the stockmarket is discounting a fall in Retail property values of almost as much as the 20% fall suffered during the 2007-2009 financial crisis.
Sunday Press and News (1): The main focus in the Sunday papers was, inevitably, on the embattled Philip Green, although the front page of the Mail on Sunday claimed that an “exclusive” interview with him had revealed that he thought that his controversial treatment of staff “was only banter” and that he had suffered “the worst week of my life”. The News pages of the Sunday Telegraph had a big feature headlined “Fashion world twists the knife into king who no longer rules the High Street” and a brave column by Retail correspondent Ashley Armstrong headlined “”Be careful you don’t have an accident” he warned, as I just tried to do my job”. There were a variety of front-page Business stories: the Sunday Telegraph led with “Green empire hit by Debenhams woes”, flagging that the beleaguered Arcadia will lose c100 concessions because of the planned Debenhams store closures, and it also had a
Sunday Press and News (2): In other news, Oliver Shah also noted in his Sunday Times column that Amazon could be an unexpected rival to Morrisons in the likely auction of surplus sites by Sainsbury and Asda next year, flagging up a separate article about Amazon’s plan for a lot more UK grocery stores (“Amazon primes its technology to invade the High Street”). The Sunday Times also noted that landlords have cast doubt on the feasibility of the 50 planned Debenhams store closures. The Sunday Telegraph flagged that Julian Dunkerton, the co-founder of Superdry, is struggling to convince investors that he should return to run the business, with one top shareholder saying that it would be “a very big distraction” and there was a Business editorial thundering that “great entrepreneurs don’t always make good bosses” and that Julian Dunkerton’s plan to revive Superdry “all sounds a bit
Sunday Press and News (3): There were plenty of previews of the Chancellor’s Autumn Budget, with a good summary in the Sunday Telegraph (“Hammond waves goodbye to austerity, but still faces a difficult balancing act”). The Political correspondent of the Observer, however, focused in his column on “The spectres spooking Britain that Philip Hammond can’t banish” and the Business section of the Observer had a feature article headlined “Even if austerity is “over”, it will be a long road to prosperity for Wigan”. Finally, it remains unclear what plans, if any, the Chancellor has for his much-vaunted Online/Digital sales tax, but the main Business story in the Mail on Sunday was that “Tech giants “should pay £1bn more in tax””.
Today’s Press and News: The beleaguered Philip Green gets knocked off the front pages by the Budget and other news in today’s papers, although the FT picks up on his Mail on Sunday defence that his abuse of staff was “just banter”. There are plenty of Budget previews and the FT front page headline is “Hammond to put Brexit at heart of Budget that retreats from austerity”, although the well-respected Paul Johnson of the IFS pens an interesting column in the Times headlined “Will it be victory for spreadsheet Phil or for political expediency?” The FT Small Cap column is devoted to Games Workshop (“Games Workshop sets out brightly painted business model”) and on the same page there is a big article about the new Lease accounting rules for retailers (illustrated, inevitably, by a photo of a Debenhams store). The Times flags that Land Secs is to also look into housing potential of its
News Flow This Week: This afternoon brings the Autumn Budget at 3.30pm. And with the end of the month coming up quickly now, we also get, on the Economics front, the latest CBI Distributive Trades Survey, for what it’s worth, at 11am this morning and the latest GFK Consumer Confidence index first thing on Wednesday (ahead of the latest MPC interest rate decision and Bank of England Inflation Report on Thursday at noon). Otherwise, the highlight of the week is the Next Q3 update on Wednesday (will it be a Halloween “shop of horrors”?), although it is also a big week for Carpetright (the first half pre-close update is on Thursday morning), Intu Properties (the John Whittaker “PUSU” bid deadline is Thursday afternoon) and Apple (the Q4 results in the US are out on Thursday evening). And look out for news of how Julian Dunkerton’s tour of Superdry shareholders in the City is going, as