Langton Capital – 2023-05-05 – The coronation, service sector, trains, IHG., US Q1s & other:
The coronation, service sector, trains, IHG., US Q1s & other:A DAY IN THE LIFE: Impatience is not a virtue but, when it comes to some spelling and grammar errors, because so many programmes and websites autocorrect text, it might not always have consequences. However, as I am wont to type my name as MArk and our firm as LAngton, secure in the knowledge that MS Word at least will correct the error, it’s always a nuisance when you come across something that doesn’t and a website or some-such persists in calling you mR MArk bRUmby for the next decade or so. And it doesn’t help that there’s no-one to blame out there but yourself. Anyway, it’s Friday, it’s another long weekend, it feels as though there’s something afoot for tomorrow at 11am but the weather’s not playing ball. Fourteen of the next fourteen days in York, for example, have a rain splodge next to them with one at least promising thunderstorms. Have a great one nonetheless and let’s move on to the news: LANGTON EMAIL: The Free Email is now written in short form. Extended versions of many stories (after the ellipses) are in the Premium Email. Reply to this email if you would like to upgrade. Prices for the Premium are £395 for one subscription, £695 for multiple, £995 for very large subscribers, all plus VAT. Or sign up for easy in, easy out monthly option per subscriber HERE https://www.paypal.com/cgi-bin/webscr?cmd=_s-xclick&hosted_button_id=87YUG2Z5W7PSN THE ECONOMIC IMPACT OF THE CORONATION: Summary: The coronation is unlikely to manufacture money. True, there will be an upsurge in foreign visitors but the bulk of those celebrating will be existing UK residents and they will be moving money from where they would have otherwise spent it rather than creating new wealth. That said, spend in some areas may go down – it is hard to see how dentists or tool manufacturers or funeral parlours will see a boost to revenues – it should be good for our sector, namely hospitality. Sectors: Arguably – and it is arguable as we haven’t had a coronation for 70yrs – there will be more losing sectors than winning… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. PUBS & RESTAURANTS: More on the coronation: Whatever one’s views, the above is hard to ignore. Springboard’s Marketing and Insights Director Diane Wehrle says ‘the Coronation weekend will be a once in a lifetime event for UK consumers, offering a spectacle never seen before by most of the population…’ • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Meanwhile Mike Watkins of Nielsen commented earlier this week that ‘the Coronation will be an event to celebrate, as we saw over the Jubilee weekend, when shoppers celebrated with fizz and teatime treats, so there could be a demand for similar products this year despite shoppers wanting to make savings. This means opportunities for premium own label products that complement the occasion and meet the price point of consumers. Moreover, Beers, Wines and Spirits could be a footfall driver as people look to commemorate and entertain.’ Service sector activity: S&P yesterday produced its April PMI reading for the UK services sector. Key takeaways were an upturn in confidence, better numbers, a strong labour market but also renewed (or continued) upward price pressure… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Trading: CGA by NIQ and Wireless Social reports that Edinburgh was the most ‘vibrant’ UK city, with sales and log-ins surging back since the end of COVID restrictions. London, which was hit hard by COVID lockdowns, soars to second on the list after welcoming back many office workers and visitors over the first quarter. • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Train strikes: It has been confirmed that RMT members have backed further strikes. It is likely that industrial action across 14 train operating companies will continue until November after 90% of voting union members backed action. RMT general secretary Mick Lynch says ‘this sends a clear message to the employers that the huge anger amongst rail workers is very real and they need to recognise that fact, face reality and make improved proposals.’ Other news: Smoking, drinking and eating chocolate. Former chancellor George Osbourne has said that smoking should be banned and the sugar tax extended to include fruit juice and milkshakes… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. The consumer: Regards to retail guru Nick Bubb for pointing out Retail Economics’ comments on the consumer. It says ‘key recessionary behaviours are set to persist in Q2 2023 as consumers make more considered purchases, including: (1) trading down to cheaper alternatives; (2) delaying large purchases; (3) focusing on essentials; and (4) discount hunting.’ The Night Time Industries Association has welcomed the appointment of restaurateur Alex Claridge as the first night-time economy adviser to the West Midlands Combined Authority. COMPANY NEWS: The Black Sheep Brewery is being circled by a range of financial and strategic investors who have until Friday to share their rescue offers. That’s today… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Shake Shack yesterday reported Q1 numbers saying that total revenue was of $253.3 million, up 24.5% versus 2022. Including franchisees, it says system-wide sales were $394.7 million, up 27.5% versus 2022. The operating loss is $3.2 million and the net loss is $1.6 million… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Arcade bar operator NQ64 has secured a £10m facility with alternative lender ThinCats, allowing the owners to buy back Imbiba Private Equity’s minority shareholding in the company. In February 2021, Imbiba invested £1.4m in the business to support its expansion. The new funding will also support NQ64’s expansion plans throughout the UK. Arc Inspirations is set to open its largest BOX Bar to date in Brindleyplace Birmingham, this June. The new venue will have capacity for 575 guests and is spread over two floors, featuring an upstairs bar and private dining room. McDonald’s has been fined nearly £500k by Thames Magistrates’ Court after pleading guilty to three charges of hygiene breaches. The verdict comes after a rodent infestation was discovered at one of its restaurants in Leytonstone. A customer was half-way through eating their cheeseburger when they noticed what they thought was a mouse dropping on the inside of the wrapper. Texas Roadhouse in the US yesterday reported Q1 numbers saying that total revenues in the period rose by 18.9% to $1.17bn with net income of $86m against $75m in the same quarter last year. The company delivered EPS of 128c (2022: 108c). The company reports that ‘comparable restaurant sales increased 12.9% at company restaurants and increased 13.3% at domestic franchise restaurants…’ • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Freedom Brewery has reported a record year in the period to end December 2022. Revenues came in at £5.3m ‘with volume exceeding 25,000HL for the first time in the company’s history. Sales were up 16% versus the previous year and 44% ahead of 2019.’ MD Matt Willson says ‘over the last 12 months we have seen strong double-digit growth in the On Trade channel as more pubs, bars and restaurants switch to Freedom 4% craft lager as their craft offering.’ He adds ‘we are perfectly positioned to maximise the opportunity within craft lager over the coming years.’ The MCA reports that Neil Sebba, managing director at Tossed claims that London is not as busy as it used to be, saying ‘The secondary streets still feel really quiet. Units are closed and there are not many people around… even if it still feels busy’ and that people have ‘forgotten how busy London used to be’. HOLIDAYS & LEISURE TRAVEL: Intercontinental Hotel Group has reported Q1 numbers saying that REVPAR in constant exchange rates in the quarter was up 33% vs 2022, with Americas +18%, EMEAA +64% and Greater China +75%. The average daily rate +11% vs 2022, +10% vs 2019; occupancy +10%pts vs 2022, minus 2%pts vs 2019. The group now has a worldwide estate of 915k rooms over 6,179 hotels. IHG CEO Keith Barr reports ‘we’ve seen a good start to the year, with continued strong trading in both the Americas and EMEAA, and an excellent rebound in demand in Greater China since the lifting of travel restrictions…’ • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. The coronation and the London hotel market: Unsurprisingly, the coronation has led to a spike in rates. STR says ‘hotel bookings across London are surging. … While the Friday and Saturday of coronation weekend have already hit a peak for the month of May, we expect these figures to increase in the coming days as excitement grows and the eyes of the world are once again on London.’ Ipsos UK & Ireland CEO Kelly Beaver has said that the UK public is “deeply conflicted about travel” due to its environmental impact. Air Plus International has said that business travel in the UK is continuing to recover. Royal Caribbean Group has reported Q1 numbers announcing an adjusted Q1 loss of 23c per share. It says ‘these results were significantly better than the company’s guidance primarily due to strong close-in bookings at higher prices, continued strength of onboard spend, and favourable timing of operating costs…’ Manchester Airport is planning a £1.3bn project to upgrade its Terminal Two with an extended departure lounge and shopping area with 27 new shops and restaurants. The company aims to announce the successful applicants by next April. The work is expected to be completed by 2025. TripAdvisor reports revenues of $371m in Q1 compared to $262m last year, with the company topping consensus revenue estimates four times over the last four quarters. EPS was $0.05 per share, beating the Zacks Consensus Estimate of $0.03 per share. This compares to loss of $0.09 per share a year ago. OTHER LEISURE: Apple has reported Q1 sales saying that revenues fell by 3% in the quarter compared with the same period in 2022 to $94.8bn. Sales also fell in Q4 last year. The decline was less bad than analysts had feared. CEO Tim Cook says of expansion in the market in India ‘overall I couldn’t be more delighted and excited by the enthusiasm I’m seeing for the brand there.’ The company cautioned that it is facing a ‘challenging macroeconomic environment.’ Gravity Fitness, an active entertainment company, is launching a new office in Merchant Gate, Wakefield after securing £30m funding. Victoria Harris of Knight Frank commented ‘The regeneration of Merchant Gate has provided a timely boost to Wakefield’s economy and has underlined the city’s importance and attraction as a strategic location for prime office, retail and leisure occupiers.’ FINANCE & MARKETS: S&P’s composite PMI for April rose to 54.9 from 52.2 in March. S&P says ‘a strong rate of service sector growth meant that the UK economy started the second quarter of 2023 in positive fashion. Overall private sector output expanded at the fastest pace for one year, despite another fall in manufacturing production during April.’ S&P says ‘service providers experienced the steepest upturn in new work for 13 months as resilient consumer spending combined with a turnaround in demand for business services to boost overall order books. Survey respondents often cited an improvement in clients’ willingness to spend, helped by greater confidence with regards to the near-term economic outlook….’ • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. The ECB yesterday raised rates by 25bps to 3.25%. UK mortgage approvals rose sharply, by 18%, between February and March this year. Sterling up at $1.2609 and €1.1417. Oil price higher at $73.21. UK 10yr gilt yield off 3bps at 3.66%. World markets weaker yesterday but Far East up in Friday trade and London set to open up around 26pts as at 6.30am. RETAIL WITH NICK BUBB: • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. |
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