A Day in the Life:

So apparently there’s a calculator being sold in joke shops that only ever gives incorrect answers.

And that has some appeal as a gift because, provided the numbers that the thing spat out didn’t look wildly inaccurate or obvious wrong, you could buy one for work-rivals and potentially fatally undermine their careers under the guise of being nice to them.

That should sell well in certain passive-aggressive neighbourhoods though a punch on the nose is still the favoured dislike-signal in many other areas.

Anyway, it feels like Friday but, and here’s the bad news; it isn’t. On to the news:

The News:

PUB, RESTAURANT & DRINKS PRODUCERS:

• Charles Wells has reported that its French business ‘has seen a massive increase in sales thanks to the European football Championships held in the country over June and July this year.’ It says ‘for the four week period (10 June-10July) the 13 pubs across France took a total of €1,545,574 – a 175% increase from the same period in 2015.’ The group reports that it used 136,800 plastic cups.

• Charles Wells says that its Charles Dickens pub in Bordeaux performed extremely well after BBC Wales set up their broadcast base at the pub. The group has 13 pubs across five cities in France.

• Chef Neil Rankin is to launch a new restaurant, temper, in Soho on 5 November. The 198-cover unit will seat guests around an open kitchen and fire pit where meat dishes will be barbecued and prepared in front of them. Rankin comments ‘I have often felt that some meat focused restaurants are overly masculine and put the emphasis too heavily on large cuts of meat. I wanted to create a restaurant that offered choice, not only in terms of portion size, but also in animal breeds, sides and sauces.’

• Moody’s has reported that Ruby Tuesday’s decision to close underperforming restaurants is credit positive. It says ‘the company expects that closing the 95 underperforming restaurants will improve EBITDA by $12-$14m annually.’ Moody’s says ‘we expect Ruby Tuesday to benefit from the proposed changes through a modest level of improved traffic and SRS. We have seen other restaurant companies such as El Pollo Loco (unrated) and California Pizza Kitchen (B3 positive) make changes to their menu and refresh restaurant interiors that have improved SRS trends.’ Is there a lesson here maybe for other, potentially over-extended restaurant operators in the UK?

• Crowdcube has raised c£7.3m for itself via a crowd-funded offer. The 10.08% stake values the entire group at around £72m. Launched in 2011, the platform has raised c£160m for c350 businesses.

• Ministers are reported to have watered down the UK’s much-anticipated childhood obesity strategy. Curbs on junk-food ads have been dropped. The focus is moving to school sports and exercise. Food producers have been asked to cut the sugar content of their products by 20% by 2020.

• Wandsworth has become the first local authority in Britain to seek to formally protect its pubs from redevelopment per The Times. Some 120 pubs across the borough will be impacted. They will not be eligible for demolition or for conversion into shops, offices, houses etc.

• The ALMR has said that the proposed sugar tax is ‘a backwards step’. It says it will increase administrative burdens without delivering results. ALMR CEO Kate Nicholls comments ‘the Government’s tax on sugary drinks is intended to tackle public obesity but there is a danger it will do little more than increase costs for both retailers and customers.’ She adds ‘for the majority of customers, eating-out is an occasional treat and pubs and restaurants have worked hard to reformulate menus, reduce calories and provide customers with greater choice and nutritional information.’

• Punch is to freeze prices to its tenants & lessees on its spirits until summer next year. The group says ‘we’re always looking for ways to support our publicans and provide them with that little bit extra, which is why we have decided to freeze spirits prices for a second year. This will help our publicans maximise the profit opportunities available to them on these products.’

• The ALMR has suggested that the London Night Tube will ‘provide greater access to London’s late-night economy and [provide] a boost to bars and nightclubs.’ The ALMR says ‘London is regarded as one of the world’s true 24-hour cities and an all-night tube service will give customers much improved access to some of the capital’s best nightspots.’

• The IWSR has reported that consumers ‘are continuing to trade up and experiment with premium and niche drinks’. Distinctions between categories are becoming blurred. The IWSR highlighted the increasing engagement of women in the drinks market in new and emerging markets.

• Epic Pubs has re-opened the Mill Street Pub & Kitchen in Oakham, its 3rd venue. He unit has undergone an extensive refurbishment ‘which has seen the interior and exterior totally remodelled to create a contemporary and light look that feels lived in, in all the best ways.’ MD Andrew Coath reports ‘we are really excited to be entering the next phase of Epic’s development with this new pub, which will build on the success of our two existing businesses.’

LEISURE TRAVEL & HOTELS:

• Thomas Cook has announced that it has signed a strategic hotel sourcing partnership with online services provider Webjet. Cook reports that ‘under the agreement Sunhotels, Webjet’s European online accommodation business, will take responsibility for sourcing and contracting hotels that account for the majority of Thomas Cook’s complementary business.’ Thomas Cook has an existing relationship with Sunhotels in its Nordic markets.

• TCG says sourcing partnership will allow it ‘to focus on growing its core differentiated holiday offering while at the same time providing customers with a wider range and choice of complementary hotels in a more efficient way.’ TCG CEO Peter Fankhauser reports ‘entering this new relationship with Webjet will transform the way in which Thomas Cook offers a wide choice of hotels to customers. It provides us with a low-cost production platform for our complementary offer across all our source markets, enabling us to streamline our systems and processes while at the same time ensuring greater certainty over the quality of hotels that we offer our customers. This frees us up to focus on growing our differentiated holiday offering, the area where we know Thomas Cook can really make a difference.’

• IHG has signed on a Holiday Inn in Gdansk City Centre saying that it is ‘reinforcing the company’s growing position in the Polish market.’

• The 11 blasts that rocked various Thai resorts last week were not the work of Islamic militants.

OTHER LEISURE:

• The FT reports ‘a resolution to the complex $18bn bankruptcy of sprawling US casino group Caesars Entertainment is, at best, months away but the endgame is now becoming clearer.’

• US gambling mogul Steve Wynn is soon to open his $4.2bn casino in Macau.

• Crown Resorts has reported a 3.8% increase in normalised PBT to AU$855.8m for the full year. Macau was weak but results overall came in ahead of expectations.

• The Original Bowling Co has invested £300k in the refurbishment of its Hollywood Bowl Centre in Middlebrook Retail Park.

FINANCE & MARKETS:

• Moody’s suggests that the UK economy will slow post the Brexit vote but will not enter recession. It sees 1.5% growth this year and 1.2% next. Moody’s says ‘uncertainty around the future of the economy outside the common market will continue to dampen business investment and consumer spending, as businesses hold back on hiring and making long-term investments, and as consumers postpone large spending decisions.’

• Moody’s says ‘fall in the sterling will mitigate some of the negative effect in the short term by providing a boost to exports.’ It should also choke off imports as these will be less affordable. The least good outcome would be if consumers cut back on domestic spending in order to spend more on a new BMW.

• Minutes from the Fed’s last meeting show policy-makers divided over the timing of the next US rate rise. The minutes say ‘members judged it appropriate to continue to leave their policy options open and maintain the flexibility to adjust the stance of policy based on incoming information.’ They add ‘a couple of members preferred also to wait for more evidence that inflation would rise to 2% on a sustained basis.’

• Japanese exports have fallen for the 10th consecutive month in July.

• Demand for farmland is said to have dropped sharply on fears that EU subsidies will not be replaced in full by the UK government. The RICS reports ‘for now, this [the 23 June vote] appears to be weighing heavily on demand and prices have begun to slide.’

• A Bank of America poll has suggested that European fund managers believe that low interest rates are doing more harm than good. Admittedly fund managers rely on savings, which are effectively being dissuaded by low interest rates.

• UK unemployment in Q2 fell by 52k to 1.64m leaving the rate at 4.9% per ONS data.

• Wages rose by 2.3% annually in Q2 reports the ONS. The ONS reports ‘the labour market continued on a strong trend in the second quarter of 2016, with a new record employment rate.’ It adds ‘however, little of today’s data cover the period since the result of the EU referendum became known.’ The BCC reports ‘labour market indicators tend to lag behind the wider economy, so it is likely to be some time before the full post-referendum employment picture emerges. However, more needs to be done to boost business confidence, so that firms can continue to grow and recruit.”

• World markets: UK & European markets lower yesterday, led down by miners. US up & Asia mostly up in Thursday trade

• Oil price off a bit but up over last 24hrs. Brent crude trading around $49.65 per barrel.

YESTERDAY IN A NUTSHELL – SEE LIVE TWEETS ON WEBSITE:

• Coffer Peach Business Tracker shows trading negative in regions in July but London keeping its head above water.

• Tracker suggests ‘post-vote Britain carries on eating and drinking out’. Regions negative but London busy

• Tracker: Says LfL sales +0.3% in July 2016 vs year ago. Says London outperforms rest of Britain at +2.9% vs minus 0.5%

• Tracker: London benefiting from tourist influx, rest of the country in negative territory post Brexit vote.

• Tracker: Total sales in July +4.0% vs LfL sales +0.3% shows impact of new openings. Capacity issues remain somewhat concerning.

• Carlsberg reports Q1 number, organic net revenue growth of 2% with total volumes down organically by 2%

• Carlsberg Q1: Says ‘2016 earnings expectation maintained’ & sees ‘operating profit growth by low-single-digit percentages’

• W Morrison has sold its stake in US online grocer FreshDirect for £45m in a further withdrawal from the US.

• Rising fuel prices helped to drive the UK’s inflation rate up to 0.6% in July according to ONS figures. Sterling up vs weak US$.

• Other Tweets: Sterling bouncing from lows vs Euro but impact on PPI now clear (and ongoing). PPI up to 4.3% in July (3yr high) with further to go.

• FTSE down from year highs yesterday. Bit of a bounce this morning. Scramble for yield making equities look cheap (when they’re not)

• Commodities. Corn, wheat & hogs’ prices sliding (in US$ terms). Gold steady (near highs) & oil giving a little back though still near $49

• Deathly quiet out there, feels like peak holiday week with a Bank Holiday impacted fortnight thereafter.

RETAIL NEWS WITH NICK BUBB:

• Planet ONS Watch: In the real world, July (the 4 weeks to July 30th) was a better month on the High Street, as per the BRC-KPMG Retail Sales survey, thanks to the warmer weather, but we will find out at 9.30am what it was like last month on that bizarre parallel world, the Planet ONS, via the Office of National Statistics Retail Sales figures for July. For what it’s worth, our friends at Capital Economics think July’s figures are likely to show a small slowdown in annual growth in the wake of the Referendum result and look for flat “seasonally adjusted sales volume” month-on-month (+4.2% year-on-year), despite the 0.9% month-on-month volume dip in June.

• Peach Tracker Watch: We are indebted to some more friends, the Leisure sector experts at Langton Capital, for flagging up yesterday’s monthly figures from the curiously named Coffer Peach Tracker of pub and restaurant sales. In total, the July figures looked OK, with LFL sales up by 0.3% and overall sales (including new openings) up by 4.0%, but there was a big regional split, with London outperforming the rest of the country…Helped by increased tourist trade, London sales were up by +2.9% LFL, but outside the M25 sales were down by 0.5% LFL, despite the better weather. CGA Peach’s Peter Martin commented “It’s been a fairly sluggish market so far this year and the Brexit vote doesn’t appear to have altered that trend one way or another – and July’s performance was actually stronger than April or May’s”.

• Asda PR Watch: The huge PR team at Asda will be spinning away this afternoon, on the back of the Wal-Mart Q2 results out in the US, although the continued poor LFL sales performance of Asda won’t be much to shout about and it is unclear whether the new CEO Sean Clarke will be sharing his views on the way forward, given Wal-Mart’s forthright view on the back of the Q1 results that the business needed to focus more on improving top-line sales than protecting bottom-line profits…

• Lookers: After Tuesday’s interims from Marshall Motors, yesterday has brought the interims from its Manchester-based rival Lookers and although there is no more acquisition news (having bought the Mercedes dealer, Draytons, for £55m cash on Monday), the results themselves make for good reading, with revenue up 33% to £2.34bn and adjusted PBT up 16% to £50m. In terms of the outlook, Lookers flag that “we have a healthy order book for the delivery of new cars in the important month of September” and say that “the result of the Referendum has created a degree of uncertainty in the UK economy, although it is fair to say that we have not noticed any significant difference in terms of customer behaviour so far, particularly in respect of orders for new and used cars. Notwithstanding the uncertainties over consumer confidence and the Pound : Euro exchange rate, the
board is confident that the group will make further progress during the rest of this year with revenue and profits ahead of last year’s performance”.

• Laura Ashley: It’s easy to forget about Laura Ashley, even though its Malaysian owners have kept the quote (it has a market cap of £160m), but it is doing well and has reported final results for the 74 weeks to June 30th (having changed its year-end last year). Underlying PBT was just under £26m on sales of £401m. LFL sales growth was 4.1%, with growth across-the board, in all categories, helped by 16% Online LFL growth.  And in terms of current trading and the outlook, the company says that “Trading for the six weeks to 13 August is performing in line with management expectations. We will continue to focus on enhancing the design and quality of our product ranges upon whose provenance the Brand has been built. In a time of uncertainty for retail and the global economy at large, we are optimistic and confident that Laura Ashley will remain a business with solid
foundations to withstand challenges as they arise”. And the brand values also stretch to running boutique hotels, with healthy-looking sales of £3.5m for the period (albeit that includes the second one opened on Lake Windermere, as well as the original Manor Hotel in Elstree).

• Sports Direct Share Buyback Watch: Having insinuated yesterday that Sports Direct’s “Mr Share Buyback Man” was so exhausted by his rather modest efforts so far that he had gone off on holiday on Monday (as no shares were bought that day), we can report that he burst back into action yesterday, to buy the sum total of c18,000 shares at c297p…He might just as well have stayed on holiday!

• John Lewis Partnership Sales Watch: That great Retail bellwether John Lewis kicked off the second half of their financial year (y/e January) in good form in the first week of August, but sales wilted in the heat last week, with sales down by 2.3% gross (nearly 4% down LFL) in w/e Aug 13th (“In what proved to be a challenging week, footfall was down as customers chose to enjoy the great outdoors, as well as making the most of the school holidays by heading abroad with their families”). Fashion was down 2.6% gross, Electricals were 2.2% down and the Home department was down by 1.4%. In the first half of the financial year, John Lewis sales were up by 4.7% (a shade over 3% up LFL), with Electricals up by 8.4%. The hot weather was more help to John Lewis’s sister company, Waitrose, last week, although overall gross sales were only up by 1.1% (c1% down LFL) in w/e Aug
13th. Waitrose sales in the first half were up by 2.6% gross (marginally up LFL).

• Kingfisher: Today’s Q2 update from Kingfisher (for the 13 weeks to end July) looks solid enough, with overall LFL sales growth of 3.0%, but it is very mixed, as that is driven by the UK and Poland, with the key French business 3.2% down LFL in the period (“widespread industrial action and exceptionally wet weather created a more challenging environment, after a more encouraging Q1”). The UK was up by as much as 7.2% LFL, although that was driven by 13.3% LFL growth from the trade business Screwfix, with B&Q up by 5.6% LFL, helped by surprisingly good seasonal sales

• Today’s Press and News: The main Retail story in today’s papers is that, as flagged on the front page of the Times, Philip Green lost his temper with a TV reporter from Sky News after being approached whilst holidaying on the Greek island of Ithaca.