Langton House – 08-08-3019 – Coca Cola HBC, Zonal, Diageo, Other:
Coca Cola HBC, Zonal, Diageo, Other:
A DAY IN THE LIFE:
We can confirm that Slovenia’s Lake Bled is both 1) very pretty and 2) very busy. Lake Bohinj is arguably prettier and certainly less congested but the problem is that you’ve got to pass the one spot (with its accompanying hoards of tourists on foot, bicycle, skateboard and scooter) in order to get to the second.
And that’s a problem, because it turns what could be on a good day a very pleasant 50 minute jaunt into an hour and a half crawl. After which you have to fight with the visiting campers and their camper vans in order to secure a parking place but here driving an Italian hire car is an advantage as the incumbent German and Dutch tourists seem certain that you will crash into them if they don’t give way.
Anyway, we’ve got another stack of photos, have topped up the sunburn and nudged through 2,000km in the hire car, all of which must be good. Tomorrow it’s on to Padova (Padua) via Trieste and we’re into the final stretch. The sewage in Venice should be cooking nicely at 33 degrees in the shade and we will be there to experience it in full over bits of the weekend.
As previously mentioned, elements of Langton are on holiday this week. Back properly next Tuesday but, in the meantime, the email could be a little bit shorter than usual. On to the news:
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GENERAL NEWS – PUBS & RESTAURANTS:
Coca Cola HBC has seen H1 2019 currency-neutral sales increase by 3.4% to 3,352.4m, while volume increased 2.2% to 1,090.4m unit cases. Comparable earnings per share was €0.612, a 1.5% increase on the prior-year period, while basic earnings per share was €0.536, a 9.2% decrease.
Zoran Bogdanovic, Chief Executive Officer of Coca-Cola HBC AG, commented on the group’s H1 performance: ‘We are pleased with this solid first half given the challenging combination of tough comparators and unseasonably cold and wet weather. We grew revenue and volume across all three segments of our business and delivered further growth in comparable margins’.
Remarking on the trading outlook for Coca Cola HBC the group stated: ‘In the second half of 2019 we expect to see an improvement in revenue growth compared to the first half in all three segments and especially in Emerging. We would anticipate this improvement to be driven by faster volume growth in all segments, while the growth in revenue per case on a currency-neutral basis is expected to continue at the pace of the first half’.
The FT reports that the ‘costs of insuring PizzaExpress debt against default has jumped to its highest level amid concerns over the chain’s borrowing as it grapples with an increasingly difficult UK market and a costly overseas expansion.’ Langton commented last month that the group’s debt pile looked rather large and that the amount of debt owed, per restaurant, arguably exceeded their worth.
The FT says ‘as one of the oldest and largest casual-dining operators in the UK, PizzaExpress has been buffeted by slowing consumer spending and increased costs from a combination of rising business rates and increases to the national living wage.’
The Fulham Shore has announced that CFO Nicholas Wong has purchased another 33,000 ordinary shares in the Company at 11.44p per share. Mr Wong now has a total beneficial interest in 8,995,593 Ordinary Shares, equivalent to 1.57% of the Company’s issued share capital.
The hospitality tech group, Zonal has appointed Alison Vasey as its Group Product Director. Zonal’s chief operating officer, Peter Edwards, commented: ‘We are delighted to have Alison onboard to continue our drive in delivering product innovation for operators and their consumers, who increasingly expect technology excellence as an integral part of their hospitality experience’.
Diageo has increased its investment in the non-alcoholic spirit brand Seedlip to a majority holding, as the global spirits group looks to cater to the growing number of teetotallers.
The latest report from The Wine and Spirits Trade Association has shown that gin sales in the UK reached 76m bottles in the last 12 months to March 2019, worth £2.3bn. WSTA chief executive Miles Beale stated: ‘It’s been another phenomenal 12 months for gin and, despite recent reports suggesting the gin bubble may have burst, our numbers suggest the exact opposite – not only is gin’s popularity here to stay, it’s now worth over £3bn annually’.
The most recent retaliatory tariffs suggested by the US against EU products could see between 11,200 and 78,000 US jobs put at risk as a result. Alcohol trade groups have released a joint statement: ‘If beverage alcohol products remain on the final US list, the EU would certainly respond by keeping US beverage alcohol products on its list, thus inflicting more damage on US companies that export to this critically important market and hampering the export progress that has benefited our sectors and created good paying jobs across the US’.
Subway has become the latest restaurant chain to introduce a plant-based meat alternative, with the introduction of the vegan meatball from beyond meat. Len Van Popering, Subway’s chief brand and innovation officer commented: ‘Our guests want to feel good about what they eat and they also want to indulge in new flavors. With our new plant-based Beyond Meatball Marinara sub, we are giving them the best of both worlds’.
The Indian-Mexican burrito cahin Wrapchic has been bought out of administration by Zampor Limited, saving the ‘majority of its sites.
Greggs has announced plans to open a further 100 stores this year due to growing customer numbers and strong sales numbers. chief executive Roger Whiteside commented: ‘38 per cent of our shops now serve catchments wholly outside of traditional shopping locations and we anticipate that this proportion will continue to grow to more than 50 per cent in the longer term’.
Charles Wells has purchased The Oliver Cromwell in St. Ives, with Fleurets brokering the deal. Gareth Hatton of leisure property specialist Fleurets commented: ‘This has been a significant acquisition both for Charles Wells and the Cambridge town of St Ives. It goes to show that these thriving town centre pubs continue to generate interest, not just from independent operators, but notable regional breweries and pub companies’.
The UK food industry has asked the government to suspend certain aspects of the competiton law to allow firms to co-ordinate and direct supplies with each other after a no-deal Brexit. The Food and Drink Federation said: ‘We asked for these reassurances at the end of last year. But we’re still waiting’.
Stephen Welton, the head of the Business Growth Fund, the UK’s busiest investment vehicle has complained that VC funding is too hit-and-miss. Welton said: ‘The VC industry doesn’t work in my view. The venture-capital industry is all based on looking for a unicorn. Some will find them, but the vast majority will not. Venture capital as an asset class over a long period of time has shown some exceptional returns at the very top and then some poor-to-mediocre returns’.
HOLIDAYS & LEISURE TRAVEL:
Seaworld Entertainment has seen its revenue for the year increased by 3.6% to $406m during Q2 2019, with H1 sales at $626.6m up 2.9%.
Imperial London hotels and Hilton have been accused of ‘profiteering’ from the collapse of Super break, by hiking prices.
The UK’s membership to the Interrail scheme is set to come to an end on January 2020.
British Airways claims it has fixed the IT glitch which has resulted in more than 100 flights being cancelled and over 200 delays. A spokesperson for BA said: ‘We continue to advise customers to check ba.com for the latest flight information before coming to the airport, and to leave additional time’.
Ryanair’s UK-based pilots have voted in favour to strike in a row over pay and conditions. The British Airline Pilots Association commented: ‘We have had no formal offer from Ryanair and it is imperative that we resolve this dispute urgently to avoid strike action.No pilot wants to spoil the public’s travel plans but at the moment it seems we have no choice’.
Walt Disney has failed to meet expectations with its profit figures, sending shares down 5%. Profits at the entertainment giant fell 51% to $1.4bn in the last three months, despite revenues rising 33% to $20.2bn.
START THE DAY WITH A SONG:
Yesterday’s song was You Can Call Me Al by Paul Simon. Today who sang:
How many times have you been told if you don’t ask you don’t get?
How many lads have taken your money, your mother said you shouldn’t bet
And who has the fun?
RETAIL WITH NICK BUBB:
Naked Wines: If you’re wondering why today’s Majestic Wine AGM at 11.30am is being held in an office block in the centre of Norwich (rather than in, say, the Watford HQ of the company) it is because Norvic House in Chapelfield Road is the home of the Naked Wines business and shareholders are being asked, inter alia, to approve the change of name of the company to Naked Wines. We don’t know when that will take place, but judging by how quickly Findel became Studio Retail last week, it may be only a few days away, although the ticker will stay as WINE. Interestingly, after the AGM the new Chairman of the company will be the former Home Retail boss, the American John Walden.
Pendragon: We have been expecting the interims from the struggling Motor retailer Pendragon (best known for its Evans Halshaw and Stratstone brands) this week, but it has been pointed out to us that it announced with the profit warning in mid-June (flagging that there would be a significant loss in the six months to end June) that the results would be delayed from early August until late September, because of the complexities of the operational and financial review. It was subsequently announced two weeks later, on the back of the resignation of the new CEO Mark Herbert, that the strategic update expected with the interims, would be delayed until a new CEO was in place…The Pendragon share price drooped to c16p/17p after that news and is now trading at only around 12p…
Sports Direct: Tomorrow is the anniversary of Sports Direct’s disastrous acquisition of House of Fraser from the administrator last year and in the recent final results statement #MadMike gave himself only 1/5 for his stewardship of the business since then. In any other company he would have been sacked by now, but as the controlling founder shareholder his poor judgement doesn’t matter…and it was announced yesterday that his stake in Sports Direct has edged up from 61% to 62%, as result of the company share buyback programme.