Support package, possible closures, Scotland, Carnival & other:

A DAY IN THE LIFE:

Why do people say things like ‘over six times’ or ‘over 93 restaurants’ when what they actually mean is seven or 94?

I mean you might say ‘over 200’ when you meant 206 or 207 but why give such a specific figure and, in some cases, why say ‘over eight’ when what you actually mean isn’t that at all, it’s really eight?

Perhaps the above is indicative of how one’s mind wanders when the news flow starts to dry up. so, let’s move on to what stories there are:

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NEW SUPPORT PACKAGE, INDUSTRY REACTION:

The FT sums up the uncertainty of recent days when it says ‘Rishi Sunak has succumbed to pressure from business leaders and announced more than £1bn in support for companies across the UK hit hardest by the pre-Christmas surge in cases of the Omicron coronavirus variant.’ He had ‘previously insisted that sufficient measures were in place to support beleaguered businesses through until the spring.’ That didn’t last long.

The key points:

• The hospitality & leisure sectors will be eligible for one-off grants of up to £6,000 per premises and another £100m of discretionary funding will be made available for councils in England to support other companies.

• The government will cover the cost of statutory sick pay for Covid-related absences for small and medium-sized companies.

• Some £30m extra will be made available for the Culture Recovery Fund.

• An additional £154m will provide for equivalent support in Wales, Scotland and Northern Ireland.

Reaction:

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PUBS & RESTAURANTS:

S4Labour reports that ‘as Christmas uncertainty begins to continue, data from S4labour shows sites within London are down 30% on last week’s sales.’

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PM Boris Johnson yesterday Tweeted ‘I wanted to confirm that people can go ahead with their Christmas plans. But we’re keeping a constant eye on the data and can’t rule out any further measures after Christmas.’ This has provided some certainty for operators over the next four or five days but has led to speculation that parliament may be recalled in the days after Boxing Day and further regulations may be introduced next week.

Several gym operators are warning that the sector is ‘now on a knife-edge fighting for survival’. In a letter to the prime minister, they called for the reintroduction of furlough payments, urgent financial support via grants and a reduction in VAT.

SIBA has released a statement saying ‘The current uncertainty is keeping customers away from hospitality and without economic support for the hundreds of breweries and thousands of pubs that rely on December trading we will see many more small businesses close.’

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UKHospitality Cymru says that a 50% reduction in business rates for Welsh hospitality businesses is a pleasing start but that additional support is critical. David Chapman, UKHospitality executive director for Wales, said relief was essential to help businesses from April forward, when VAT returns to 20%.

Q1 rent bills will need paying by Christmas Eve. UKH says this could amount to £1.5bn for the hospitality sector.

Scotland has tightened Covid restrictions. Football stadia will not be allowed to admit fans and Hogmanay events are to be cancelled.

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Commenting on the support package that accompanies the above, the SBPA says ‘this short-term package of support from the First Minister is welcome at this extremely challenging time for pubs and brewers. It will be a vital lifeline for many and will help compensate businesses for the dramatically reduced trade already being experienced in the run up to Christmas.’

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CGA has commented on a tumultuous year saying that ‘hospitality can bounce back again’ and adding that ‘although we are now facing more immediate challenges with restrictions, there are positives that can be taken from this year that offer signs of what is to come for the On Premise next year.’

Lumina Intelligence has reported that delivery took an extra two percentage points of market share of eating out occasions in November. The share had peaked at 19% earlier in the pandemic before falling to 15% in October and then rising in December. Lumina says ‘with the weather turning colder, we expect to see an uptick in delivery over the winter months.’

COMPANY & OTHER NEWS:

Mitchells & Butlers has agreed a £650m full scheme buy-in with Legal & General for its company pension fund. Reports say all scheme members are covered by the transaction. Mitchells & Butlers Executive Pension Plan chairman of trustees, Jonathan Duck, comments ‘the trustees are delighted to have concluded this bulk annuity buy-in with Legal & General. The transaction further secures all members’ benefits as well as giving M&B plc, the plan sponsor, certainty on its future financial commitments. It is a great deal for all parties.’

The Inn Collection Group has acquired The Swallow Falls Hotel in Snowdonia National Park, North Wales. The undisclosed deal is the award-winning operator’s first acquisition in Wales and its first outside of its north of England heartland.

Clean Kitchen Club has published carbon values for each of its menu items, claiming to be the first brand to do such a thing.

Cultured meat company Future Meat is reported to have secured $347 million in a Series B funding round.

LEISURE TRAVEL & HOTELS:

The travel industry has expressed disappointment that it is not to share in the Chancellor’s new, £1bn, fund to aid hospitality and leisure. See above.

Carnival Corporation reported a net loss of $2.6bn for Q4, ending the quarter with around $9.4 billion of liquidity and said it had turned ‘cash flow positive’ in November. Occupancy in the fourth quarter was 58% versus 54% in the third quarter of this year, with 61% of the company’s fleet capacity back operating with guests on board.

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YouGov analyst Eva Satkute Stewart reports that at the end of November, 70% of British adults indicated they were following the topic of the new variant closely. Nearly one in five British adults say they have already cancelled or postponed plans over the next couple of weeks due to the variant.

Hays Travel has reported that it incurred a loss of over £34 million in the 18 months to April 2021 during what it called the “most challenging period” in its history due to the Covid crisis and the death of its founder John Hays.

Staycity has announced that it has opened the doors to its newest property, in the heart of Dublin. It says the ‘centrally located, 142-apartment property on Mark Street is a short walk from Trinity College and close to Pearse Street Rail station, Grafton Street and the National Gallery.’ CEO Tom Walsh says ‘we have seen a huge surge in demand for aparthotels, amongst both business and leisure travellers who appreciate the home-from-home environment and freedom to self-cater but with additional facilities such as the gym, reception and café.’

Eurocontrol director general, Eamonn Brennan, has called Christmas ‘a dead duck’ with passenger no shows running at 20% last week. Brennan said ‘What everyone is hoping for now is Easter, not Christmas.’

Subhas Menon, director general of the Association of Asia Pacific Airlines (AAPA), has said international air traffic in Asia is languishing far behind the rest of the world owing to a ‘zero-Covid’ approach by governments and vaccine inequity in poorer countries.

New Zealand has postponed its plans for a phased reopening to international travel from January until the end of February. The phased border re-opening will be reviewed at the end of February.

UK train services are facing shortages ahead of Christmas due to self-isolation causing staffing chaos. LNER has taken out 16 trains a day until 24 December between London, Lincoln and Leeds to cover ‘an increased level of absence in drivers and train managers due to coronavirus’, and warned it may have to make more cancellations at short notice for staffing reasons.

OTHER LEISURE:

London Mayor Sadiq Khan has said the capital’s New Year’s Eve celebration event at Trafalgar Square will not go ahead ‘in the interests of public safety’. A live broadcast celebrating London and its defining moments of 2021 will take its place, with Mr Khan urging people to watch it from home.

FINANCE & MARKETS:

Sterling higher at $1.3286 and €1.175. Oil price higher at $74.04. UK 10yr gilt yield up 10bps at 0.87%. World markets better yesterday and London set to open up by around 10pts as at 7am.

RETAIL WITH NICK BUBB:

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