Fuller’s full year, FDEV update, hospitality confidence, trading & other:

A DAY IN THE LIFE:

Thinking about popularity and being famous the other day, it dawned on me that some people are born famous, having a surname like Windsor (or Trump, for that matter) will do that to you, and others have fame thrust upon them.

Or they work hard to thrust it upon themselves.

But, and I hope this isn’t the green-eyed monster emerging, even amongst the happily famous crowd, I think there must be a split between those who pout and preen in front of a mirror of an evening and realise they’ll soon need more fingers to tick off their failed marriages, business ventures etc, and those who sit in a darkened room and weep.

Anyway, having the paparazzi sift through your bins must be a bit disturbing so it’s just as well that I’ve never needed to work too hard at being anonymous. Indeed, being a meh sort of person suits me just fine.

Because, having used The Sweet in yesterday’s song quiz, I can’t think of many things I’d rather do less than strut around in front of a crowd in big shoes and a sequined onesie, sporting daft eye-makeup and a wig.

For those who know me, I’ll leave you with that thought. On to the news:

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PUBS & RESTAURANTS:

Current trading & trends:

Industry debt-provider OakNorth has updated on its view of trading saying that ‘over the last six months to 30 April 2025, the UK hospitality and leisure sector continues to demonstrate resilience, despite mounting cost pressures and evolving consumer behaviour.’ It cautions that ‘underlying price pressures remain entrenched and are expected to intensify in the months ahead.’

Re costs, OakNorth says ‘the rise in the National Living Wage, increased employer National Insurance Contributions, and overall utilities inflation has already ushered in a sharp rise in operating costs for hospitality and leisure providers….’

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Hospitality business confidence:

CGA’s latest Business Confidence Survey reports that only 34% of Britain’s hospitality leaders feel confident about prospects for their business over the next 12 months. It adds that  the ‘proportion of leaders feeling confident about the future of hospitality in general is even lower at 15%. Both figures are up by just 1 percentage point from the last Business Confidence Survey in early 2025, and 19 percentage points below the levels of May 2024….’

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Job prospects:

UKH points to NIC changes as a major factor in the rise in unemployment reported by the ONS yesterday. It says ‘losing more than 100,000 jobs across the economy in a month goes far beyond the worst-case scenario predicted by the Government’s own fiscal watchdog, major banks, and countless business groups….’

Retail prices:

The MA reports that the average price of pint of lager in Great Britain is now £5.15, according to its own data. It adds that this is ‘a whopping 32p higher than Government figures.’ The MA adds that ‘London has the most expensive average lager price at £6.07 with Birra Moretti, Amstel, Asahi, Peroni and Staropramen all tipping over the £6.60 mark.’ It says ‘the area with the cheapest average pints of lager are the Midlands, the north-east and Wales. Pubs can expect to sell a pint for £4.53, £4.87 and £4.92 respectively.’

Disposable income levels:

The ONS yesterday reported that the annual growth in employees’ average earnings was 5.2% for regular earnings (excluding bonuses) and 5.3% for total earnings (including bonuses). Real earnings growth, stripping out CPI, is 2.1% for regular pay and 2.3% for total pay.

Employment and employment prospects:

The ONS also updated on employment levels yesterday saying that ‘payrolled employees in the UK decreased by 55,000 (0.2%) between March and April.’ it adds that the early estimate of payrolled employees for May 2025 shows a drop of 109,000 (0.4%) on the month. Re unemployment, the ONS says that ‘the UK employment rate for people aged 16 to 64 years was estimated at 75.1% in February to April 2025. This is above estimates of a year ago, and up in the latest quarter….’

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FULLER, SMITH & TURNER – FULL YEAR NUMBERS:

Fuller’s has this morning reported full year results and our comments thereon are set out below:

Headline numbers: Fuller, Smith & Turner has reported that revenues rose by 4.8% to £376.3m with margins widening and adjusted EBITDA up by 11.2%. Adjusted PBT is some 32% higher at £27.0m. EPS is up by 40% as 34.22p and the dividend per share is up by 11.3% at 19.76p. The group reports that debt excluding lease liabilities rose by around £9m to £142.2m. Fuller’s reports that like for like sales rose by 5.2% in the year ‘against a successful prior year.’ The group says ‘our Tenanted Inns have had an excellent year and the business has never been in better shape.’

Current trading & outlook:

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COMPANY NEWS:

The Times reports that Diageo is considering selling its stake in India’s Royal Challengers Bengaluru cricket team as part of broader disposal plans as it strives to boost confidence amid weaker alcohol sales….

Keystone Brewing Group, which has in recent years acquired a number of breweries, has raised a further £2m from shareholders. The group says that the cash will support the next phase of its growth following a period of rapid expansion. The group includes brands such as Black Sheep, Purity Brewing, Hofmeister, North, FourPure and Magic Rock….

Restaurateur Thai Leisure, which operates the Chaophraya and Thaikhun restaurant brands, has reported numbers for the period to 30 January 2025 to Companies’ House saying that revenue slipped by 3.9% to £31.3m with operating profit slipping from £1.1m to £0,5m. The group has benefited from 3.3m of loans written off in the period under review meaning that PBT rose from £0.8m to £3.6m…

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This year’s National Restaurant Award for best restaurant has gone to The Ritz in London.

The Revel Collective (was Revolution Bar Company) has reported that it has appointed Matthew Fowler as Chief Financial Officer, effective from 16 June.

The Cornish Bakery, which is currently exploring options for a potential sale of the business and which has has appointed Tamweel Capital as an advisor to assist with the process, reports that ‘since the start of 2025, Cornish Bakery has recorded a 9% increase in like-for-like sales, bolstered by record-breaking trading over Easter and the May Bank Holiday weekends.’

HOLIDAYS & LEISURE TRAVEL:

OakNorth comments on the UK hotel industry saying that ‘London’s hotel market continues to lead the way in terms of demonstrating strong resilience and adaptability, with the capital boasting the second highest occupancy levels of all major cities in the world. In contrast, more rural hotels that offer golf & spa facilities, as well as upscale brands have also driven recovery over the past six months.’

Intercontinental Hotels Group has reported that it has hit ‘the significant milestone of 100 open hotels for its voco brand within just seven years.’

Eurostar has said it is to launch three new routes, including services from London to Frankfurt and Switzerland when it receives its fleet of c50 new trains, likely in the early 2030s.

FRONTIER DEVELOPMENTS – FULL YEAR TRADING UPDATE:

Frontier Developments has this morning updated on full year trading and our comments are set out below:

Today’s update in context: FDEV updated last as recently as 28 May, saying that revenue for FY25 was ‘expected to be approximately £90 million (FY24: £89.3 million), which is ahead of expectations through strong performances across Frontier’s game portfolio.’ It reported two weeks ago that ‘the better-than-expected revenue performance, further boosted with a gain of £3.5 million on the sale of the publishing rights for the Foundry game Stranded: Alien Dawn (which is not accounted for as revenue), will deliver stronger-than-expected profitability in FY25 and a higher-than-expected cash position.’

Headline numbers: Today’s update adds that revenue increased to £90.6 million (FY24: £89.3 million), with revenue from Frontier’s genre-leading Creative Management Simulation (CMS) games growing 25% year-on-year. It says that its three main CMS game franchises – Planet Coaster, Planet Zoo and Jurassic World Evolution – together generated 77% of total revenue in FY25 (FY24: 62%). The company adds that ‘profitability grew significantly, with Adjusted EBITDA expected to be in the range of £8 million to £9 million (FY24: £0.9 million) through higher revenue, a higher gross margin percentage, a lower operating cost base, and a £3.5 million gain on the sale of the publishing rights for a Foundry game (Stranded: Alien Dawn).’ It says cash grew by £13.0 million to £42.5 million at 31 May 2025 (31 May 2024: £29.5 million), reflecting trading performance, tax credits and the sale of publishing
rights. The company adds that ‘a share buyback programme of up to £10 million will be initiated, subject to shareholder approval, to enhance shareholder value.’

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OTHER LEISURE:

The Gym Group is hosting a presentation and site visit for analysts and investors at its Elephant & Castle gym today. It says ‘no material new financial information will be provided in today’s presentation.’ The company will provide an update on its financial performance for the six months ended 30 June 2025 on 9 July 2025.

The UK government’s Business & Industry Department reports that ‘former sports presenter Alan Bentley has received an 11-year directorship ban after his football betting firm collapsed owing investors over £10 million, having continued to collect £1.5 million in investments despite no evidence of trading activity…’

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Grip UK, which trades as the Climbing Hangar and which has 11 sites in operation, has reported numbers to 30 Sept 2024 to Companies’ House saying that revenue rose by 27% to £10.0m on the back of the opening of its Edinburgh site with losses before tax reduced to £1.4m from £1.7m in the prior year. The company has lost some £8.0m since its incorporation in 2010, leaving it with net worth of £2.1m versus £3.5m at the end of September in the previous year…

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FINANCE & MARKETS:

The World Bank reports that the 2020s could be the worst decade for global growth since the 1960s. It points the finger at President Trump’s tariff flip flopping and the resulting uncertainty….

Sterling lower at $1.3482 and €1.1812. Oil lower at $66.81 and the UK 10 year gilt yield down 7 basis points at 4.55%. Most markets better yesterday but London set to open around 13 points lower as at 6.30am.

RETAIL WITH NICK BUBB:

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