Langton Capital – 2019-12-19 – Patty & Bun, online sales, (lack of) discounts etc.:
Patty & Bun, online sales, (lack of) discounts etc.:
A DAY IN THE LIFE:
I don’t know if ‘dadsplaining’ is a real word but, if it isn’t, then perhaps it should be.
Because, amongst the many faults that I wouldn’t want to admit to, it’s one charge that I can’t really avoid due to the fact that, having seen one’s now-grown offspring as infants, I would argue that it’s hard sometimes not to spell things out perhaps a little too much.
The eye-rolls and the sideways glances give it away a little and, when you’ve been outed, it’s probably best to just shut up and fall back on the old favourites such as would you like a beer, a meal or some money, and hope that no permanent damage has been done.
Anyway, the volume of news and the ‘out-of-office’ replies would seem to be inversely correlated and it’s getting still quieter out there. On to the news:
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PRIVATE COMPANY NUMBERS – PATTY & BUN. Patty & Bun has reported overdue November 2018 numbers to Companies’ House. 19 Dec 2019:
• Revenues rose by almost 32% to £11.6m.
• Gross profit was £7.6m to give a GP percentage of 65.1% versus 64.1% in the prior year.
• The group reports an operating loss of £528k against an operating loss of £741k in the prior year.
• There is very little interest payable and the loss before tax is £533k (2017: £771k). See Premium Email.
PUBS & RESTAURANTS:
• The Advertising Standards Authority has told Scottish brewer Brewdog to take down an ‘offensive’ billboard saying that its alcohol free beer left you as ‘sober as a motherfu.’ The billboard in question was apparently near to a school.
• Brewdog says that advert ‘was not designed to cause offence and given it contained no profanity, it would not cause serious or widespread offence and was not inappropriate for display in a medium where it could be seen by children.’
• The Coaching Inn Group has bought the 22-bedroom Bell Inn hotel in Stilton, Cambridgeshire. This follows a £22m refinancing of the business with NatWest bank.
• The Morning Advertiser reports that Cumbria Police is working with pubs in Whitehaven to implement bans of up to 13mths for rowdy customers in the city’s pubs.
• IMRG Cap Gemini’s Retail Index has suggested that alcoholic drink sales online were up by 40% in November versus 2018. Beer sales were up 37.3% in the month. Online sales of all products combined is thought to be running up by around 16% on 2018 suggesting that the move in drinks is ahead of the market.
• Regarding all products. Cap Gemini says ‘the highest growth this year has been seen in the discounting periods; a sign that when wider consumer confidence is low then the predictable sale events in the retail calendar are counted on for stretching wallet spend.’ Some online observers have suggested that, if anything, online sales have been a little disappointing overall this year.
• There are few food & drink discounts around at present. With a week to go till Christmas, it would be surprising if there were. Nonetheless, Prezzo is offering 40% off mains until 22 December and Toby, owned by M&B, is offering 25% off mains until 2 February next year.
• Chop and grill specialist Blacklock is to open a fourth restaurant in London next year, in Covent Garden.
• In the US, Carl’s Jr. (which is owned by CKE Restaurants) is reported to be launching an all-day menu with Beyond Meat products.
• Nespresso is to open an ‘experience-led’ boutique outlet at London Bridge Station in order to ‘increase accessibility’ to its products per The Retail Bulletin
• Caprice Holdings will open a restaurant at London’s Theatre Royal Drury Lane in partnership with Andrew Lloyd Webber. Caprice also runs London restaurants Sexy Fish, Scott’s, Le Caprice and The Ivy Collection.
• Punch has completed a £193,000 investment in The Kings Head in Chacewater, Truro, with the pub having reopened last week.
• Café Rouge has surveyed the accessibility across 50 sites in the first phase of its partnership with AccessAble.
• In the US, December statistics show quick-service restaurant same-store sales up 3.1%, with Texas Roadhouse the standout performer with a four-year annual same-store sales stack of 20.6%.
• Crowdcube has reported a ‘record-breaking’ year for overseas businesses raising funds. It says that its fund-raising for overseas businesses has doubled since 2018. The crowd-funding platform says ‘we welcome the move by European regulators to bring in ground-breaking legislation in 2021, aimed at growing capital markets and which is sure to feed financing for entrepreneurs.’ Crowdcube lost £3m in the year to September 2018 and it has some £20.5m of accumulated losses to date.
• Grocery charity IGD has commented on the UK retail market saying that the UK has little ‘safety margin’ to absorb any Brexit shocks and adds that ‘unsurprisingly…shopper confidence in the UK remains low.’ It adds that ‘low confidence and low spending power are manifest in weak retail performance, as recorded by multiple sources.’
• IGD says its ‘Christmas sales forecast for 2019 is conservative, anticipating grocery sales growth of + 1.2% year-on-year.’ It says this ‘reflects weak volumes, weak inflation and generally unhelpful strategic situation. As in previous years, discounters and online channels are expected to do best.’
HOLIDAYS & LEISURE TRAVEL:
• ABTA has suggested that some 5m Britons will be abroad over Christmas & the New Year. Peak travel day will be Friday. Christmas Day, unsurprisingly, will be the quietest day of the period. Breaks are varied with city breaks, winter sun and skiing holidays all featuring prominently.
• 10 former Thomas Cook branches have been close by new owner Hays Travel. So far, 461 of the 553 ex-Thomas Cook branches have been reopened by Hays, but chair Irene Hays said the agency was ‘having trouble recruiting in some places’.
• Dalata Hotel Group claim challenging conditions in Ireland have hit revenue as it looks to expand its UK portfolio with plans for a Liverpool opening. The Dublin hotel market saw RevPAR down 3.2% in the 11 months to the end of November, however the group’s UK hotels outperformed their markets.
• STR reports US hotel occupancy up 0.3% to 61.8% in November, with ADR up 1% to $125.55 and RevPAR up 1.3% to $77.62.
• VisitBritain forecasts overseas visitors to spend £26.6bn in 2020, up 6.6% on 2019’s projected £25bn. The number of overseas visits to the UK is expected to grow to a record 39.7 million, up 2.9% on 2019.
• CEO of Bet365, Denise Coates, paid herself £323m last year, comprised of a £277m base salary and £45m of dividend payments. In the past three years, Coates has collected a total of £817m.
• Per Nielsen, consumers have listed augmented and virtual reality (A/VR) as the top technology they’re seeking out to assist, amplify and augment their daily lives with 51% saying they are willing to use this technology to assess products.
• The Telegraph reports that Sky has been lobbying Ofcom to open up local news to new competition, with plans to launch its own local news service.
• The BBC could face a difficult time under a Boris Johnson premiership per the Telegraph as he touts programme boycotts, Trumpian jibes and threats of a funding squeeze against the service.
• The CMA has urged the government to consider tougher rules for online giants such as Google and Facebook as a lack of “real competition” could mean higher advertising costs being passed on to consumers. The comments come amid reports that the government will create a new digital watchdog to oversee these businesses.
FINANCE & ECONOMICS:
• The UK CPI for November remained unchanged at 1.5% for the year to that month. The NIESR says ‘underlying inflation increased by 0.1 percentage point to 1.0 per cent in the year to November 2019.’ It adds ‘underlying inflation increased in most regions of the UK. On this basis, we expect CPI inflation to settle around the Bank of England’s target of 2 per cent in the coming year.’
• The ONS has reported that UK house price growth is at its weakest since 2012. It shows that prices in London were down by 1.6% in the year to October. Property prices in the North East were down by 1.1%.
• President Trump will be the third US president in history to face an impeachment trial after decisions made in the House of Representatives in Washington yesterday.
• Sterling lower again at $1.3082 and €1.1758. Oil price higher at $66.24. UK 10yr gilt yield up 2bps at 0.79% and world markets mostly lower yesterday with Far East down in Thursday trade.
• Politics & Brexit:
o The EU has said that Boris Johnson’s timetable for agreeing a future trade deal is ‘extremely challenging’.
o The Labour Party may be in meltdown suggests the FT. It’s previous post-war nadir, 1983 with Michael Foot, saw it secure more seats than it did last week. In 1983, Labour had another 14yrs to wait before it was back in power.
o The race to replace Jeremy Corbyn is on with Keir Starmer, Lisa Nandy, Rebecca Long Bailey, Emily Thorberry and a few others likely to throw their hats into the ring.
o Former PM Tony Blair has said that Labour needs to cease being a ‘protest movement with cult trimmings’ and appeal once again to the middle ground.
o FT suggests that there could be something of a reality check coming next year as the UK continues the c75yr process of readjusting to life post-empire etc. It says ‘in Boris Johnson, the voters were offered a Conservative chancer waving the flag of English nationalism.’ It opines that Labour did not provide much in the way of opposition to his fantasy world view.
START THE DAY WITH A SONG:
Yesterday’s song was Kashmir by Led Zeppelin. Today, who sang:
“There is no pain you are receding,
A distant ship smoke on the horizon
You are only coming through in waves
Your lips move but I can’t hear what you’re saying”
RETAIL WITH NICK BUBB:
• Planet ONS Watch: In “the real world”, as per the overall BRC-KPMG figures for November (the 4 weeks to Nov 23rd), underlying Retail Sales were reasonably solid last month, adjusting for the later fall of “Black Friday” this year, but we will find out at 9.30am this morning what “seasonally adjusted” life was like on the High Street on that strange parallel world, the Planet ONS (aka the Office of National Statistics in Newport), via their official Retail Sales figures…Now, City economists (who still, unaccountably, treat the dubious-looking ONS figures as the gospel truth) generally expect a rise of 0.5% in month-on-month seasonally adjusted sales volumes, but our friends at Capital Economics have pencilled in a dip of 1.0% (to give year-on-year volume growth of only 0.9%), for what it’s worth. We will be amused to see how the hapless ONS tries to adjust for the shift of Black Friday
• Completion Watch: We flagged yesterday that WH Smith was holding its EGM for shareholders to approve the big US deal and that Carpetright was holding its EGM for shareholders to approve the Meditor rescue bid…and both, needless to say, went through on the nod. But, such are the legal complications, neither deal will complete in a hurry, with “sometime in Q1 2020” the best guess for the eventual completion date (albeit they have a “backstop” date of March 31st and March 1st respectively)…
• News Flow This Week: Tomorrow brings the widely followed GFK Consumer Confidence survey for “December” (but note that most of the polling will have been done before the Election…).
TRADING STATEMENTS & EVENTS:
Upcoming results are set out below:
• Est 16 Dec 19 EasyHotel FY numbers
• Est 16 Dec 19 Games Workshop H1
• 16 Dec 19 Fulham Shore H1 numbers
• 19 Dec 19 Bank of England MPC interest rate decision
• Est 20 Dec 19 Carnival Q4
• 16 Dec 19 Fuller’s H1 numbers
• Early Jan 20 Xmas statements (in the order presented last year) – Stonegate, Morrison’s, Naked Wines, Gregg’s, Sainsbury, Constellation Brands, C&C, Brighton Pier, Everyman, M&B, M&S, Tesco.
• Mid Jan 20 Xmas statements (in the order presented last year) – Revolution Bars, Games Workshop, Gym Group, Cineworld, City Pub Group, Saga, DP Eurasia, Whitbread, Ten Entertainment, Premier Foods, SSP, EasyHotel, William Hill.
• Late Jan 20 Xmas statements (in the order presented last year) – JD Wetherspoon, Hotel Chocolat, Restaurant Group, Starbucks, Fevertree, AG Barr, Fullers, DPP, Domino’s, Hollywood Bowl, Britvic, Rank, Diageo.
• 23 Jan 20 G4M Q3 update
• 24 Jan 20 Marston’s Q1 trading update
• 29-31 Jan 20 – Springboard charity Snow White pantomime at Leicester Sq. Theatre
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