Langton Capital – 2022-11-16 – October Tracker, costs, employment, inflation, JDW & more:
October Tracker, costs, employment, inflation, JDW & more:A DAY IN THE LIFE: I’m pleased to report that the switch of internet providers in the office yesterday seemed to go relatively smoothly and at a saving of perhaps 60% per month, it was worth battling the ever-present suffocating inertia and getting off one’s behind to avoid being punished for one’s loyalty any longer than was strictly necessary. Although, having said that, it did the best part of a year or two for us to address the issue but, now that it’s done, it’s done. Of course our new supplier will wait for the status quo to become established and for our ‘doing-something-about-it’ energy to dissipate, and will then begin to charge us more and more hoping that we don’t notice until, going on previous form maybe towards the end of this decade, we’re once again spurred into a brief burst of activity to do something about it. Anyway, all good so far. On to the news: LANGTON EMAIL: The Free Email is now written in short form. Extended versions of many stories are in the Premium Email. Reply to this email if you would like to upgrade. Prices for the Premium at time of writing are £345 for one subscription, £595 for multiple, both plus VAT. Or sign up for easy in, easy out monthly option HERE https://www.paypal.com/cgi-bin/webscr?cmd=_s-xclick&hosted_button_id=87YUG2Z5W7PSN PUBS & RESTAURANTS: Current trading: The latest Coffer CGA Business Tracker has revealed that managed groups’ trading was up by 1.5% on October 2021 and rose some 4.3% on 2019 numbers. Both figures are well below accumulated inflation over the period… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Autumn statement: In an attempt to avoid shocks and promising there will be no more ‘rabbit out of the hat’ moments, much of the Autumn Statement seems to have been leaked. Or ‘flagged up for the benefit of the market’ if you prefer. Either way, it looks like a 40% windfall tax on electricity generators, rates bill increases of 5%, a maintenance of the triple lock, around a 9.5% increase in the national minimum wage and most allowances frozen so that wage inflation drags more people into taxation and into higher bands. Just possibly, the earnings level at which people get dragged into the 45% tax band could be reduced. Business costs: If the NMW rises by 9.5% to £10.40 per hour, the hospitality industry will have little option but to pass the bulk of the rise on… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Business confidence: Bad news spoiler alert. The cautious news just keeps on coming with the ICAEW this time releasing its Q4 2022 Business Confidence Monitor. This ‘shows business confidence falling further across the UK as difficult economic conditions combine with political turmoil…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Employment: As with much data, there was enough in yesterday’s employment numbers to keep most people happy. The jobs market appears to be firm, wage inflation was a little higher than expected and unemployment rose… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. The consumer: Whilst a rise in the NMW will hit the cost line for leisure operators, the workers beneficially impacted are also potential customers and, with 9.5% rises likely and the triple lock perhaps set to be maintained, there could be a little more cash in some pockets… Insolvencies: The UK Insolvency Service has updated on its monthly insolvency stats saying that in October 2022 there was a total of 1,948 registered company insolvencies across England and Wales. They comprised 1,594 creditors voluntary liquidations, 242 compulsory liquidations, 107 administrations and just 5 company voluntary arrangements (CVAs). The latter number is down 69% on October 2021 and it is 86% lower than in October 2019 Other news: The ONS has said that some 15,000 pubs and restaurants may be cutting back on opening times for one day a week or more because of rising costs. Energy bills may currently be to blame but, if the 9.5% increase in the NMW goes through, then wage costs will also become a major factor. Costs to the consumer. The Telegraph reports that the price of some of the most popular branded food products have increased by more than 100% over the last two years, far beyond the average 15% rise in food prices. An investigation by consumer group Which? found the cost of Dolmio Lasagne Sauce had risen 107% in one major supermarket… The Daily Mail has reported what it says is ‘the New Year 15% price hike on pints.’ It says ‘drinkers face forking out over £7 for draft beer and cider from 2023 as brewer Heineken passes on ‘unprecedented cost increases’ to landlords – amid cost-of-living crisis…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. The British Free Range Egg Producers Association (BFREPA) warns that British farmers could run out of eggs by Christmas as a result of rising costs and the ongoing outbreak of avian flu. The group says a third of hen farmers surveyed earlier this month have either ‘reduced their flock sizes, paused production temporarily or left the industry altogether’. COMPANY NEWS: Deliveroo has today announced that it has decided to end its operations in Australia. It reports ‘this decision is driven by the Company’s disciplined approach to capital allocation. Management is committed to driving growth and delivering on its path to profitability while aiming to have strong, profitable businesses in each of the markets in which it operates, built on the foundation of leading hyperlocal market positions…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. JD Wetherspoon is opening a new £3m pub in February 2023 at The O2. The pub will feature a 3,800 square foot beer garden, offering views across the Thames and Canary Wharf, and will create up to 70 jobs in the local area. The CMA has announced that it is investigating the merger between Capital & Counties Properties PLC and Shaftesbury PLC. Constellation Brands has succeeded in ending its B class of shares which carried 10 times the vote of ordinary shares in a coup for equal voting rights. The B shares had effectively given the Sands family vetoing powers in the company’s direction. Jubel has launched its ‘JUBELLINGHAM’ promotion where free JUBEL pints will be given to customers any game in which Jude Bellingham scores a goal for the England national team at the World Cup. The offer is only effective at participating pubs. Keurig Dr Pepper has acquired a minority stake in US alcohol-free brewer Athletic Brewing Company for $50m. Athletic Brewing Company, which was founded in 2017 by Bill Shufelt and John Walker, has a portfolio of more than 40 beers and has recently gained a Tesco store retail listing in the UK. The investment from KDP is set to assist in the brewer’s plans to roll out further across North America. EBF Holdings, parentco of Oddbins, reports revenue up £4m to £11.98m for the year ended 31 July 2021. The company reported losses for the year of £832k, down from £1.22m the year prior. It noted that it had decided not to restart its wider wine wholesaling activity ‘as the economic climate isn’t conducive to doing so’, however it said it was exploring avenues such as licensing to boost revenue. Popeyes is set to continue its UK rollout, opening in Cambridge, Croydon and Reading in early 2023. Sites in Rotherham, Cardiff and Glasgow are also planned for next year. Overall, Popeyes UK is expected to open 20 restaurants in 2023, which will bring the total number of UK restaurants to 31 by the end of 2023. Fuller’s has acquired two further pubs in the south-west of England, one in Bourton on the Water and the other in Wootton in Hampshire. The MA reports that KFC has launched its first pub – the Colonel’s Arms – in Hammersmith, west London. The unit will be open over the World Cup. Simon Spurrell, MD of Macclesfield-based Cheshire Cheese Company, has sold his business to larger rival Joseph Heler Cheese to regain access to customers in the European Union after Brexit left him with an estimated £600,000 black hole in lost EU sales… HOLIDAYS & LEISURE TRAVEL: Sky reports that the Chinese owner of Thomas Cook, Fosun, ‘is exploring the sale of a stake in the famous British holiday brand three years after its ignominious collapse.’ It says Fosun is ‘examining options including raising capital from an outside investor in the coming months.’ Jet2holidays CEO Steve Heapy warned flight prices will continue to rise for the foreseeable future due to government taxation. Heapy estimated the cost of carbon permits, used by airlines to offset emissions, has increased from £5 to £90, which is being funnelled back into the ticket price. Labour’s shadow tourism secretary, Jeff Smith MP, warns that the lack of government support means that the Travel sector faces a ‘perfect storm’. In a speech to the Tourism Alliance, Smith will also highlight Labour’s plans to support tourism businesses, including a pledge to cut and eventually scrap business rates, replacing them with a new system “fit for the 21st century” to provide vital relief to UK tourism businesses. The new boss of Uber UK has said that people are still booking Ubers in the UK despite the current downturn in the economy. OTHER LEISURE: Netflix is now advertising a service in the UK with adverts for £4.99 per month. Google has been ordered to pay $391.5m in order to settle allegations about how it collects data from users. FINANCE & MARKETS: The Evening Standard reports that average asking prices for houses in London ‘have fallen by almost two per cent — or £13,000 — in the past month’… Former Bank of England MPC member Michael Saunders has said that Brexit is the ultimate reason why the UK is now facing a fresh round of austerity. He says ‘the UK economy as a whole has been permanently damaged by Brexit.’ He says it has ‘reduced the economy’s potential output significantly, eroded business investment.’ The CBI says more should be done to boost workforce health. It says ‘health-related economic inactivity is costing the UK £180bn a year.’ It adds ‘labour market resilience is a precondition to growth. Without healthy, productive employees, the UK economy will be unable to achieve the growth it sorely needs.’ The BCC comments on yesterday’s employment stats and says ‘the challenges facing businesses in the UK labour market remain very much the same. We have a critical shortage of skills and labour that is damaging firms and holding back growth…’ London has slipped from no1 in Europe in terms of stock market valuations to no2. Paris, which has been closing the gap since Brexit, is now in poll position reports Bloomberg. Sterling up at $1.1869 and €1.1439. Oil higher at $93.16. UK 10yr gilt yield down 6bps at 3.29%. World markets broadly better yesterday but London set to open some 13pts lower at 6.30am. THE AQUIS MARKET: Broker VSA Capital is hosting an Aquis Day on Tues 29 November at the Royal College of Surgeons (38-43 Lincoln’s Inn Fields, London, WC1A 3PE). The event will feature around 20 companies, who will present to attendants and take part in a competition to win the ‘Britain’s Got Aquis’ title. Judges on the day will include Andy Brough (Schroders) and Judith Mackenzie of Downing LLP. Tickets and details are available HERE https://www.eventbrite.co.uk/e/the-vsa-capital-aquis-showcase-event-tickets-430890363677?aff=odeimcmailchimp&mc_eid=cfe56acbe0&mc_cid=cd83de005f Attendance costs £20 – but Langton has a number of complimentary tickets and we’re open to suggestions as to who we should give them to…. Drop us a line. RETAIL WITH NICK BUBB: • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. |
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