R number, Covid passports, prices, Molson, staffing, RCL etc.:

A DAY IN THE LIFE:

The dog bullied me into sitting outside with him yesterday. It was nine degrees and drizzling.

He pulled his usual trick – insistent begging – but, when he was roundly ignored, he upped this to threatened incontinence.

I chanced it but, when he hit the nuclear button (explosive stomach upset, unpleasant events imminent north and south), I had to let him out and he wouldn’t come back in.

Needless to say, as I followed him out, he recovered immediately and lay happily in a puddle for an hour to watch me shiver. On to the news:

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PUBS & RESTAURANTS:

R number:

• The NIESR has reported that the R number in England is between 0.9 and 1.0. It says ‘for Northern Ireland the R number is in the range 0.80 – 0.95; for Wales, 0.80 – 0.95 and for Scotland, 0.90 – 1.00.’ It says that the path to indoor opening on 17 May remains open. The data includes ‘about two week’s data following step 2 of the roadmap out of lockdown’ i.e. the move to outdoor opening for pubs & restaurants and the reopening of non-essential retail.

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Covid passports:

• Michael Gove yesterday provided written statement to parliament following a trip to Israel. He says there are no plans to make vaccine certification compulsory in certain settings but gives no detail. He says ‘the Government will continue to explore the equity and ethical concerns about any form of COVID-status certification.’ The BBPA says ‘this empty statement gives our sector no long term clarity on whether it will be affected by COVID-status certificates or not.’ It adds ‘now more than ever our sector needs certainty as it looks forward to reopening indoors from May 17th and without any restrictions at all from June 21st.’

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Pricing:

• The MA reports that a number of its readers ‘have increased their prices amid reopening this month (April), following months of closure.’ It says ‘some 88 operators voted in the poll, with more than half (58%) saying they have increased their prices, less than a quarter (24%) haven’t pushed prices up but were planning to, and just 18% had no plans to implement a rise.’ There is no obvious split here between food (where publicans and restaurateurs are being funded by the taxpayer in that VAT is only 5% at the moment) and alcoholic drinks.

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Price gouging:

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The market:

• IGD reports its view that both eating in and dining out will grow in 2021. It says the ‘food and drink industry forecast to grow 12% in 2021, taking it to 97% of its 2019 pre-COVID level. IGD says ‘the reopening of the eating out sector and lifting of social restrictions will increase social dining both in and out of home and will give the market as a whole a significant boost. The value of retail is up £1.8bn on 2020 and £14.5bn on 2019.’ IGD says that discount retailers will see most rapid growth. The research has been produced in conjunction with foodservice analyst Peter Backman. He says ‘affordability and accessibility will be the two watchwords for the eating out market. Those under financial pressure will be less likely to eat out, but when they do, QSR and food-to-go are the most likely options. On the whole, operators in these sectors have been in a much stronger position than
most during the pandemic, thanks to takeaway and delivery and this continued demand will potentially enable them to prosper.’

Other Covid news:

• Staff: Journal The Caterer reports that the hospitality sector has seen a “significant” reduction in the number of EU workers over the last year, dropping from 43.4% of the workforce in the first quarter of 2019 to 39.4% this year. This may put upward pressure on wages. See above for pre-emptive moves on sales price. Inflation could be the result. Fourth reports ‘as restrictions ease further and indoor trading returns on 17 May, the necessity to recruit will heighten, placing a greater spotlight on the availability of workers.’

• The latest GO Technology report by Zonal & CGA finds that the speed and convenience offered by technology is appreciated by customers. The suggestion is that much of this will stick post Covid. The report says ‘technology not only removes pain points that have always existed, such as not being able to get the attention of a server or having to wait too long to settle the bill, but it also helps operators deliver more tailored and personalised experiences to their guests.’

Company news:

• Molson Coors yesterday reported Q1 numbers saying that it had made ‘meaningful progress’ in the quarter, despite headwinds. Reported sales fell by 9.7% and by 11.1% in constant currency terms. Net income was $84.1 million or $0.39 per share. CEO Gavin Hattersley says the company made progress despite the abovementioned headwinds. He says ‘the Company faced three major events that had material near-term impacts on the business: a system outage caused by a cybersecurity incident, an abnormal winter storm in Texas that forced utility companies to shut off power to the Fort Worth brewery for eleven days, and government restrictions that shut down the entire on-trade channel in the U.K.’

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• McDonald’s has reported Q1 numbers saying that Global LfL sales rose by 7.5% in Q1 and those in the US were up 13.6% against the same quarter last year. Langton comment – see premium email.

• Texas Roadhouse has reported Q1 numbers saying that revenues rose by 22.7% to $800.6m with net income up over 300% at $64.2m. CEO Jerry Morgan says ‘a year ago today, all of our dining rooms were still closed and while we knew brighter days were ahead, we never could have anticipated where we are today. Our operating results have exceeded even pre-pandemic levels thanks to our operators’ ability to navigate a number of factors, including the easing of dining room capacity restrictions, guest excitement to get back into our restaurants and the continued strength of our To-Go sales.’

• Amazon more than tripled profits to $8.1bn in Q1 this year.

• Australian wine exports to China are reported to have dropped by 97% to A$12m as a result of the 200% levied by the Chinese government last year.

HOTELS & LEISURE TRAVEL:

• Transport secretary Grant Shapps has suggested that destinations in danger of being moved from “green” to “amber” status could be given 2wks’ notice when international travel opens up again post 17 May. Two weeks isn’t very long at all when it comes to scheduling flights, booking holidays etc.

• Data from Travel Supermarket suggests that would-be holidaymakers are becoming a little more confident and that bookings in July are picking up. It says ‘as the vaccination rollout and the latest lockdown continues to be heralded a success, in the last week there has been increased interest in summer 2021 overseas getaways.’

• On the Go Tours owner Go Travelling has raised £4.25 million in capital.

• The European Parliament has said that travellers who have been vaccinated should not be subject to additional restrictions such as quarantine, self-isolation or testing. It further says that Covid testing should be free.

• Heathrow announced Q1 numbers yesterday and announced another £329m loss. The company has lost £2.4bn since the beginning of the Covid-19 pandemic. UK boss John Holland-Kaye told Sky News that he is “deeply concerned” the UK’s Border Force will not be able to cope with additional COVID checks after 17 May.

• Yotel is to open its fifth UK property in Glasgow in May.

• Royal Caribbean has reported Q1 numbers saying that ‘we are looking forward to resuming operations out of various ports around the world in the coming months.’ In Q1, the company reports a loss of $1.1bn vs a loss of $1.4bn in the same quarter last year. CEO Richard Fain says ‘we have had very constructive dialogues with the Centers for Disease Control and Prevention (CDC) in recent weeks about resuming cruising in the U.S. in a safe and healthy manner.’ The average monthly cash burn rate for the first quarter of 2021 was approximately $300 million. US newspaper USA Today reports that cruises from US ports could restart in mid-summer, a USA TODAY report suggests. It quotes the CDC as saying that it ‘looks forward to continued engagement with the industry and urges cruise lines to submit Phase 2A port agreements as soon as possible to maintain the timeline of passenger voyages by
mid-July.’

• Wyndham Hotels & Resorts has reported Q1 numbers saying that global comparable REVPAR fell 11% year over year in Q1 vs Q1 2020, and was down 31% compared to Q1 2019.’ It says REVPAR ‘improved significantly throughout the month of April’ at which time it was down by only 7% on 2019. The company signed 112 new sites in Q1 & is converting existing hotels to the Wyndham brand as well as catering for newly built units to join the flag. Wyndham says ‘we’re very happy with the progress we’ve been making in retaining our most valuable franchisees and I think it gives us great confidence in getting back to that 95% level. We’re not seeing anything out of the ordinary right now.’

• Travel management platform TravelPerk has raised US$160 million in equity and debt funding, bringing the total it has raised to date to US$294 million.

• Uber is reported set to sign on another 20,000 drivers in the UK this year if and when travel volumes pick up

OTHER LEISURE:

• BT has confirmed it is in talks regarding the sale of BT Sport. The Telegraph had earlier reported that ‘BT is in talks with Amazon, Disney and others to offload a stake in its television arm.’ It says investment bank Lazard is working on a sale.

• Spotify Technology has reported subscriber growth below Wall Street estimates for Q1. The pandemic is annualising and the company is facing enhanced competition from Applr and others.

FINANCE & MARKETS:

• The US economy is reported to have grown at an annualised rate of 6.4% in Q1. It had been growing at an annualised 4.3% in Q4 last year.

YESTERDAY’S TWEETS:

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RETAIL WITH NICK BUBB:

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TRADING STATEMENTS & EVENTS:

Upcoming results are set out below:

• 30 Apr 21 Safestay General Meeting

• 4 May 21 Campari Q1 numbers

• 5 May 21 Ten Entertainment AGM

• 6 May 21 Shake Shack Q1 numbers

• 6 May 21 Bank of England MPC meeting

• 7 May 21 Intercontinental Hotels Q1 numbers

• Est 9 May 21 Barclaycard Consumer Spending (Apr)

• 10 May 21 Marriott Q1 numbers

• 12 May 21 Compass Group H1 numbers

• 12 May 21 Stock Spirits H1 numbers

• 12 May 21 TUI H1 numbers

• 12 May 21 Just Eat AGM

• 14 May 21 Tasty AGM

• 15 May 21 Premier Foods FY numbers

• 18 May 21 Britvic H1 numbers

• 19 May 21 Marston’s H1 numbers

• 20 May 21 Fevertree AGM

• 20 May 21 888 AGM

• 25 May 21 Restaurant Group AGM

• 25 May 21 Shaftesbury H1 numbers

• 26 May 21 C&C FY numbers

• 3 Jun 21 New River full year numbers

• 8 Jun 21 DP Eurasia AGM

• 15 Jun 21 Vianet full year numbers

• 24 Jun 21 Bank of England MPC meeting

• 23 Jul 21 Premier Foods Q1 update

• 27 Jul 21 Campari H1 numbers

• 3 Aug 21 Domino’s Pizza H1 numbers

• 5 Aug 21 Bank of England MPC meeting

• 10 Aug 21 Intercontinental Hotels H1 numbers

• 12 Aug 21 TUI Q3 numbers

• 18 Aug 21 Carlsberg H1 numbers

• 19 Aug 21 Rank FY numbers

• 22 Oct 21 Intercontinental Hotels Q3 numbers

• 26 Oct 21 Campari Q3 numbers

• 8 Dec 21 TUI FY numbers

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