Langton Capital – 2022-11-30 – Loungers, service sector, inflation, turkeys, strikes, CCL & other.:
Loungers, service sector, inflation, turkeys, strikes, CCL & other.:A DAY IN THE LIFE: Sleuthing around the criminal underworld up in York at the weekend, Langton found out from teenaged daughter that there was a crook operating across the city’s ‘better’ supermarkets known as The Vicar. Said Vicar, apparently loaded up with sticky labels, was putting down prices on products in some of the higher-end outlets in order to rob national and in some cases international companies and give a few pennies to hard up working people. At least that was probably this particular Robin Hood’s idea though it all fell to pieces when the ‘lucky’ punters got to the till clutching a steak or whatever with 20p scrawled across it crayon. Anyway, with queues building up behind arguing customers and till staff, it’s likely that the odd manager, staring at heavily-loaded conveyor belts and acres of angry faces, pulled rank and said ‘let them have it’. And that, with hindsight, was probably as good a way of creating a moral hazard or of incentivising suboptimal behaviour as you’re ever likely to see and the story continues. Anyway, on a different note, just listening to a podcast in which Sam Bankman Fried was asked ‘what was it like to earn your first billion dollars?’ instead of saying ‘I’ll let you know in a thousand years’ like the rest of us would, he said ‘just, yeah, kind of neat’. 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 LOUNGERS H1 NUMBERS – SALES GOOD, MARGINS SHARPLY LOWER: Loungers has this morning reported H1 numbers for the 24-week period to 2 Oct 2022 and our comments thereon are set out below: Headline numbers: Loungers reports revenue up from £102.4m last year to £122.3m. Adjusted EBITDA is down from £27.1m to £19.3m as the margin has fallen from 26.5% to 15.8%. Revenues are up by 53.2% in total against H1 FY20, the last H1 period not impacted by Covid. The PBT is £2.8m against £12.8m last year and diluted EPS is 2.3p against 10.4p. In line with prior years, there is no dividend. • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. PUBS & RESTAURANTS: UK service sector: The CBI has reported that business optimism in the UK’s services sector fell in the quarter to November as profitability fell further. It says that ‘last quarter, business optimism continued to deteriorate for the third consecutive quarter across the service sector as a whole, the decline was particularly sharp in business and professional services where sentiment fell at the fastest pace since May 2020…’ • 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: No rush to spend. The Bank of England reports that British households set aside £6.4bn in savings last month, £1.6bn higher than the average monthly deposit flow before the pandemic… Inflation & costs: The BRC has reported that shop prices in shops are up by 12% in the year to November. This is the highest rate of inflation since the BRC started recording the data in 2005. The BRC says that rises in the price of energy, animal feed and transport are now feeding through to the shops… Working from home: There are strongly-held opinions going both ways but a new study has found that remote-first working policies have no detrimental impact on productivity, with those interviewed instead claiming flexible working policies have the potential to boost productivity significantly in providing greater efficiency at the team level. The report argues that in allowing for greater flexibility firms also have an opportunity to reduce staff turnover related to burnout and stress. World Cup: The Market Watch World Cup Tracker from Oxford Partnership reports that a total of 13.1 million pints were sold during the game across the UK, an increase of 32.7% vs the last four Fridays. The average pub served 430 pints of draught beer and cider, 106 pints more than the average Friday. Current trading: Regarding the current situation, the MCA reports that the hospitality sector has to ‘cope with the aftermath [of Covid] as well as the storm itself, and that much of the wreckage has a nasty habit of combining with other debris to make matters even worse…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Other news: Turkeys. Richard Griffiths, CEO of the British Poultry Council, has said that some 600,000 out of about 1.3m free range turkeys have now been lost as a result of bird flu. This amounts to around half of all free range birds in the UK. There are likely to be shortages, at least of free-range birds, later this month. Train Strikes. CEO of Fuller’s, Simon Emeny, has told the BBC that rail strikes could see Christmas parties cancelled unless there is a “speedy resolution”. He says that staff who rely on hours and tips over Christmas could suffer… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. This year’s Drinks List reports that Sharp’s Doom Bar took top slot in cask ales with Timothy Taylor’s Landlord in second position. Captain Morgan Spiced was the top rum, Jack Daniels was top whisky and Camden Town Hells Lager was the top craft beer and Carling was the top lager overall (followed by Foster’s). Smirnoff Red was the top spirit overall whilst Gordon’s was the highest placed gin. Strongbow was top cider. Fever Tree Tonic was the highest-placed mixer, WKD was the top ready-to-drink brand and Coca Cola was the top soft drink overall. Springboard reports that footfall was up 4.2% YoY for the week ended 26 November, but still down 14.1% on pre pandemic levels. Footfall peaked on Black Friday, with a double digit increase in footfall from the week before. UKHospitality has partnered with the Food Standards Agency (FSA) and Food Standards Scotland (FSS) to launch an updated version of the industry-recognised hygiene standards guide for all caterers. UKHospitality CEO Kate Nicholls said ‘this industry guide is the gold standard for industry to get their advice and guidance on complying with legislation.’ COMPANY NEWS: BrewDog is to open its largest bar to date in Las Vegas next month. CEO James Watt comments ‘Las Vegas is a city like no other, so we had to pull out all the stops. With nearly 100 taps of craft beer and killer views, this oasis in the desert is the biggest BrewDog Bar we have ever opened. It must be seen to be believed.’ The MCA quotes Darwin & Wallace MD Mel Marriott as saying that the bar chain has some sites outperforming expectations, with new openings under consideration in the new year… White Rabbit Projects has secured a multi-million-pound investment from McWin, the private investment firm that also backs high street bakery chain Gail’s. HOLIDAYS & LEISURE TRAVEL: An easyJet poll has found that holidays are at the top of the list of most important things people plan to spend money on in 2023… Former PM Theresa May has told the WTTC global summit in Riyadh that the government restrictions on travel during the Covid-19 pandemic caused “acute damage” to “a critical sector” of the economy. Carnival has reported that ‘it posted a record Cyber Monday booking day yesterday that was 50 percent above volume for Cyber Monday 2019.’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. BT4Europe is calling for the ‘full digitisation of business travel’ to improve efficiencies and uptake of multimodal travel across European borders. The union of associations has produced a series of recommendations to the EU ahead of new legislation to boost cross-border train travel in the region. HVS reports that during periods of high consumer price growth, as currently being experienced, hotels are able to raise room rates, effectively passing on rising costs to consumers… OTHER LEISURE: City AM reports Hassan Al-Thawadi, Secretary General of the Supreme Committee for Delivery and Legacy of the Qatar World Cup, has admitted that at least ‘400-500’ migrant workers died while building infrastructure for the tournament. • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. FINANCE & MARKETS: The British Chambers of Commerce has reported that smaller businesses do not see a ‘bonfire of regulations’ as a priority. It says ‘across all business areas, approximately half of firms said deregulation was either a low priority, or not a priority at all.’ The BCC is calling for rules currently in force to remain so until the end of 2026… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. The Bank of England has reported that mortgage approvals fell by 10% in October in the wake of the government’s disastrous mini-Budget. There were fewer mortgages offers available and prices had risen. Hopes of a pivot to a more dovish stance on interest rates in the US were dealt a blow when a number of Fed members suggested, amongst other things, that ‘we’re going to need to keep restrictive policy in place for some time’ and ‘we’ve got a ways to go to get restrictive… we want to get this inflation under control much sooner than in the 1970s.’ Sterling mixed at $1.1987 and €1.1573. Oil price lower at $83.90, UK 10yr gilt yield down 1bp at 3.12%. World markets mixed yesterday and London set to open up around 28pts as at 6.30am. 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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