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A DAY IN THE LIFE:

We’ve got a new puppy and I know, idiot, right?

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Anyway, another full week in the offing, so let’s move on to the news.

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PUBS & RESTAURANTS:

Cost of living crisis.

Seeing the world as others see it. Tesco updated on Friday. CEO Ken Murphy repeated that ‘the market environment remains incredibly challenging’.

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Treasury minister Simon Clarke has said that employees should not expect wages to rise as rapidly as prices. This a) may be true, b) will be necessary if inflation is to be killed off before it goes into a spiral and c) will not be good for discretionary spend.

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A No Interest Loan Scheme, backed by the Treasury, is to be rolled out after a trial in Manchester.

Trading & near term outlook:

KAM has undertaken a snap poll about consumer intentions during the summer. It says ‘the results…are good news for hospitality’ in that 79% of respondents will ‘definitely visit a restaurant over the Summer (19% maybe)’ and 86% will definitely visit a pub (12% maybe).’

CGA has reported that drink sales were almost back to 2019 levels (they were down just 1% or so) in the week to 11 June.

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Kate Nicholls, CEO of UKH, is reported as saying that there has been a surge in bookings for UK-based holidays in the wake of chaos at airports. She says ‘we are not sure if this was a direct response to the travel chaos and the difficulty in travelling abroad or the cost of living squeeze or people realising how good the UK is after the platinum jubilee.’

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Travel weekly warms to the same theme when it says ‘travel agents say consumers remain nervous about flying this summer amid fears staff shortages and airline cancellations will continue into this summer, with some reporting booking alterations and shifting demand.’

Costs & confidence:

The London Chamber of Commerce and Industry has said that businesses in London may be “overwhelmed” as they are impacted by higher interest rates and energy costs and labour shortages. It has called on the Government to reverse the National Insurance rise of 1.25 percentage points.

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Rail strikes:

The Caterer reports that the national rail strike next week is leading to a wave of booking cancellations for the hospitality industry. Network Rail said that only around half of Britain’s rail network will be open on strike days on 21, 23 and 25 June with a “very limited” service running on lines open from around 7:30am until 18:30pm.

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Transport minister Grant Shapps has said it is not down to the government to step in to try to settle this week’s train strike. He called the RMT’s request for a meeting with him a ‘stunt’. Opposition parties have accused the government of standing by in the expectation that a strike will offer up political advantages. The first of three strikes is planned for tomorrow.

COMPANY NEWS:

Deliveroo CFO to leave the company: Deliveroo has announced that CFO Adam Miller is to step down as a director of the company.

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Other news:

JD Wetherspoon is investing £2.4m in a new pub at Birmingham New Street station…

D&D London is set to open its first Birmingham restaurant…

Starbucks China CEO Leo Tsoi has reaffirmed that the Seattle-based coffee chain views China as a key market and is targeting 6,000 stores in the country by the end of 2022.

Whitbread’s Brewers Fayre will open its first new site in 5 years. The 357-cover pub will be located in Milton Keynes and called The Willen Dragon.

German drinks firm Krombacher Group has announced plans to take over Heil- und Mineralquellen Germete GmbH, effective 1 August, for an undisclosed fee. Heil- und Mineralquellen Germete GmbH, which was founded a century ago, in 1922, bottles around 200 million litres of mineral water and soft drinks each year.

HOLIDAYS & LEISURE TRAVEL:

STR reports that rising interest rates in the US threaten to dampen capex numbers across the hotel industry.

Tui has warned that services at Gatwick will be ‘significantly affected’ by next week’s national rail strike. Gatwick is recommending customers use alternative travel to and from the airport on these dates and allow extra time for journeys.

Heathrow’s schedules have been ‘trimmed’ due to a baggage handling failure on Friday at Terminal 2…

Per Hotstats, European luxury hotels are back to producing profit at the almost same rate as 2019, with March 2022 GOPPAR of €66 only €4 off its March 2019 number. In London, March 2022 GOPPAR was €131, the highest level it’s been since the pandemic.

Supercity Aparthotels has gained planning permission for a 55-room aparthotel on Edinburgh’s Forth Street and Broughton Street Lane.

OTHER LEISURE:

Rank Group profit warning. Trading bounce-back is ‘considerably weaker than expected.’

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Elon Musk, in a meeting with Twitter employees, hinted at potential job cuts if his $44bn takeover bid for the social media company is successful. Mr Musk has previously warned that  he may quit the deal if he is not given data about fake accounts.

FINANCE & MARKETS:

Economists are suggesting that base bank rates in the UK, currently 1.25%, could go as high as 3%.

Made UK has called on the Treasury to provide more support.

Rightmove has suggested that the growth in house price inflation in the UK could moderate from its current double-digit rate to around 5% by the end of the year. This will represent a reduction in real terms.

Sterling weaker at $1.2237 and €1.1626. Oil lower at $113.16. UK 10yr gilt yield down 2bps at 2.50%. World markets mixed on Friday. London set to open down around 5pts as at 6.30am.

FORTHCOMING NEWS:

Another relatively quiet week on the numbers front this week. Rank Group updates on full year trading today. Thereafter, Coca Cola HBC hosts its AGM on Tuesday and Chapeldown does the same on Wednesday. Naked Wines announces full year numbers on Thursday and Carnival Cruises reports Q2 numbers on Friday.

A bit more lively on the economics front. UK CPI and RPI numbers come out on Wednesday with Public Sector Borrowing numbers on Thursday. Friday should see Flash PMI numbers as well as the widely-followed GfK Consumer Confidence numbers.

RETAIL WITH NICK BUBB:

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