Tracker, Whitbread, Playtech, labour, supply, rates, inflation, IPOs etc.:

A DAY IN THE LIFE:

We couldn’t get out of our lane on Sunday.

The reason being that we’re some ten minutes from the end of the Yorkshire Marathon. The route passes within spitting distance of our gate and, having kicked off at 9.30am, the road was closed from that time to 5.30pm.

That suggests that some runners were expected to be passing us a minute or two after setting off, a new world record on any measures, and others were expected to get there after stumbling around for perhaps 8hrs, a much more pedestrian performance.

But it is what it is. We, along with thousands of other residents, took one for the team and hopefully everyone had a good, or at least a survivable, time.

Anyway, we’re looking out at another full week of exciting news on Planet Leisure so let’s get on with it.

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SEPTEMBER BUSINESS TRACKER:

The September Coffer CGA business tracker reports that managed restaurants, pubs and bars were strong in September but it says that challenges continue. It reports that total sales were up 8% on 2019 and up 42% on the post-EOTHO month of September 2020. The Tracker reports that it was ‘tougher in London.’

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PUBS & RESTAURANTS:

Supply:

Amid suggestions that shortages could run into next year, The Telegraph reports that ministers are shunning the Road Haulage Association. There have been allegations that it was ‘hijacked by Remainers’ & the paper adds there were ‘claims it is biased against Brexit and deliberately sparked last month’s fuel crisis. The trade body speaks for thousands of logistics firms across the UK. It has been ‘disinvited from round table discussions with Whitehall officials since late September’ reports the Telegraph.

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Business rates.

UK Hospitality is requesting a meeting with the Treasury following reports that any major reform in business rates is likely to be delayed. The Treasury may have bigger fires to fight but UKH says any failure to grasp the nettle ‘would be a huge blow for hospitality as we know many of you are paying unreasonably high rates while trying to recover and rebuild.’ It adds that it has ‘highlighted the looming cliff-edge of full rates from April 2022 – based on outdated property valuations. We have called on Treasury to introduce a substantial, uncapped relief scheme for 2022-23 to ensure business survival and community investment.’

Inflation.

Pinch points may be exploited more effectively in a tight labour market. With that in mind, it’s worth noting that the government has promised staff at the DVLA payments of over £700 in an attempt to head off strike action that could prolong problems for the tens of thousands of HGV licences, up to 54,000 per some reports, said to be awaiting renewal.

Lumina Intelligence has suggested that premiumisation is driving menu price inflation.

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Labour:

Plenty of evidence that the labour market remains tight though City AM does say that the market may be ‘cooling’. That doesn’t seem to be altogether in line with the rest of its comments as it quotes the Recruitment and Employment Confederation as saying there has been a ‘noticeable jump in demand for sales and retail workers’ (postings up 11.9%) and it goes on to quote the REC as saying that this will ‘make competition for staff even more fierce in the coming weeks, with many sectors ramping up their activity as we head towards the Christmas period.’

The Telegraph bemoans the ‘fact’ that there appear to be certain jobs that Brits will not do. It quotes labour shortages on farms offering £30 per hour. Although working conditions may be somewhat warmer and drier, this does put the £9-odd being offered by coffee shops and the like – and the subsequent problems in sourcing staff – into context.

In the US, a new Moody’s report suggests that restaurants will invest in technology and will also be ‘forced to increase wages to attract the staff they need.’ It suggests that inflation will be one of the likely results. Also in the US, Lightspeed reports that 50% of operators believe they will be using more technology to cut labour usage in the next 2-3 years.

Amazon is reportedly offering sign-on bonuses of up to £3,000 in parts of the UK. This is fuelling concerns that labour will be short for everyone else. The Food and Drink Federation says there is a “battle for labour” in the run-up to Christmas.

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The Times reports that staff shortages are costing some restaurant operators as much as 10% of their revenues. It quotes D&D London as saying ‘we’re losing revenues because we haven’t got enough staff, so in the restaurants where it’s most acute we’re responding by suppressing the maximum number of covers by up to 40 per cent.’ D&D says overall UK revenues in September were up to 96 per cent of prior years’ levels.

IPO market:

The FT reports that, despite institutions seeming to have money on their books, ‘several UK companies have halted plans to float on public markets as investors signal greater hesitancy while fears grow of a winter lockdown and inflationary cost pressures.’ It cites restaurant company Hawksmoor as having ‘shelved its planned flotation, partly because of the broader uncertainty in the hospitality industry caused by shortages of labour and supply chain disruption.’ It mentions that ‘PureGym, the budget fitness company, is also reconsidering its intention to list.’

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Trading

London’s night tube service will resume next month. Trains will run on Friday and Saturday nights on the Central and Victoria lines from 27 November.

CGA has reported that drink sales are within 1% of pre-covid levels for third week in a row. It says ‘Britain’s pubs, bars and restaurants continue to pull drinks sales back to pre-pandemic levels as the On Premise enters the crucial final quarter of 2021.’ It adds that beer sales are down 4%, wine is down 11% but spirits sales are up 24%.

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COMPANY & OTHER NEWS:

Whitbread reported on Friday that ‘Nicholas Cadbury, who has been Group Finance Director for the last nine years, will be leaving to take up the position as Chief Financial Officer at International Airlines Group.’ It says ‘Nicholas will step down as an Executive Director and Group Finance Director in Spring 2022’ and adds that ‘a process to determine a successor is now underway in line with Board succession planning, and Nicholas will work with the Chief Executive Officer and the Board to ensure an orderly transition.’ CEO Alison Brittain says Mr Cadbury ‘has done a tremendous job.’

The Sunday Times reports that the restaurant chain founded by celebrity chef Raymond Blanc is poised to change hands in a deal that will allow it to expand its pubs business. It says ‘Brasserie Bar Co, which owns the French chain Brasserie Blanc and the pub group White Brasserie, is understood to be close to selling itself to Alchemy Partners, the private equity firm founded by Jon Moulton. The deal, with Alchemy paying up to £50 million, is expected to complete in the coming weeks.’

The BBPA reports that Ralph Findlay, former CEO of Marston’s PLC, and Paul Scully MP, Secretary of State for Small Business, have been revealed as winners of awards at the BBPA’s Annual Dinner 2021. BBPA CEO Emma McClarkin comments ‘after 20 years at the helm of Marston’s, it is fantastic to see Ralph Findlay win the Chairman’s Award. As both a long standing board member of the BBPA and champion for our sector the award is thoroughly deserved.’

The FT reports that Neat Burger, the Lewis Hamilton-backed vegan restaurant group, has completed a funding round led by SoftBank’s Rajeev Misra ‘valuing the company at $70m and allowing it to push ahead with plans to triple in size.’

The Inn Collection is to reopen one of the Lake District’s oldest inns in Bassenthwaite. The Pheasant has undergone a major restoration project. General manager Chris Adamson says customers will remain loyal and adds that at least one regulary has ‘been coming here every day for 40 years.’

ARC Inspirations FD Tim Knockton ‘has been recognised for his achievements over the past 18 months by winning the COVID-19 Pandemic Response Award at The Northern Finance Director Awards.’

UK Hospitality has urged the sector to use Hospitality Apprenticeships Week ‘as a platform to champion the diverse and exciting careers on offer.’ It says ‘Hospitality Apprenticeship Week is a fantastic way for people to learn about the wide range of roles in the sector, at a time when there are many opportunities to join our post-Covid renaissance. Hospitality has embraced apprenticeships as a gateway into roles as well as for upskilling its existing workforce. Anyone looking for a new job or a change of career would do well to take a look at what the sector has to offer.’

James Watt, co-founder of BrewDog, tells the Telegraph that hiring has been harder since the culture of the business was described as rotten by a number of staff. He says a ‘mismatch of expectations led to the challenges we faced with former staff.’

The Qatar Investment Authority is reported to be in the lead position to buy Selfridges for up to £2bn.

LEISURE TRAVEL & HOTELS:

Travel recruitment company C&M has said that travel firms are going to have to “beef up” the benefits that they afford staff in order to attract workers in sufficient numbers. C&M says salaries are “inching up a little” but says ‘it’s not just about pay, candidates want a good work-life balance.’

Lanzarote hotel organisation ASOLAN says that direct flights to the island from the UK should exceed 2019 numbers this season.

The US is to reopen its borders to fully vaccinated travellers from 33 countries on 8 November.

STR reports that the number of U.S. hotel rooms in construction is down roughly 48,000 from the country’s all-time high in April 2020 (220,207 rooms), according to September 2021 pipeline data.

OTHER LEISURE:

Aristocrat Leisure has launched a recommended cash bid for Playtech at a price of 680 pence in cash. It says this represents a premium of approximately 58.4 per cent. to the Closing Price per Playtech Share of 429.2 pence on 15 October 2021 and a 66.0 per cent. to the volume weighted average Closing Price per Playtech Share of 409.7 pence over the three-month period ending on the Last Practicable Date.

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FINANCE & MARKETS:

The Insolvency Service has reported that the number of businesses that failed in England and Wales last month, at 1,446, was at its highest level since the Covid pandemic began. In September 2021 there were 1,328 creditors voluntary liquidations (CVLs), 81 administrations, 25 compulsory liquidations and 12 CVAs. There were no receiverships. The numbers are up 56% on 2020 but are 4% lower than in September 2019.

The FTSE100 hit a new post-pandemic high last Friday.

The Sunday Times suggests that no10 is likely to impress upon chancellor Rishi Sunak the need to protect workers and consumers against price rises even if it means shelving economic orthodoxy for the time being. It points out that PM Boris Johnson has made rising wages a policy goal whilst no11 sees this as a likely cause of inflation unless productivity can be increased in order to compensate for the higher costs borne by industry.

Sterling up at $1.373 and €1.1858. Oil price hitting new recent records at $85.79. UK 10yr gilt yield up 4bps at 1.09%. World markets broadly better on Friday but Far East lower today and London set to open down around 8pts as at 8am.

RETAIL WITH NICK BUBB:

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