Heavitree, Coffer Peach, Sparkling Wine, etc:

A DAY IN THE LIFE:

With BHS gone and M&S and Debenhams announcing job losses or shop closures or both, it might be opportune to ask just what the role of the department store in twenty-first century Britain is.

Maybe that’s a bit heavy for so early in the morning but here’s a question for you, if none of our High Street department stores currently existed, would you feel compelled to invent them?

I mean pubs & restaurants we still actually ‘need’. You probably would ‘invent’ them and dentists, chiropodists and even funeral directors have a role to play. And they unfortunately always will but, if we didn’t have an M&S, a Debenhams, a Fenwicks, a Hammonds (Hull store pron. anamonds) or even a John Lewis to ‘anchor’ a High Street or a shopping centre, would we care.

Harsh, maybe, but would we even notice that we couldn’t buy our perfume, toys, shoes and garlic presses under the same roof? Of course, inertia is a powerful force but some things are arguable, well, on the wrong side of history. On to the news:

PUB, RESTAURANT & DRINK PRODUCERS:

• Alexandre Ricard, head of spirits giant Pernod Ricard, has commented on the legalised cannabis market saying the group was  ‘watching it closely’. Consulting firm Bryan Garnier has recently stated that the legalised cannabis market could grow to $140bn from its current $12bn.

• Heavitree has reported preliminary statement of results for the year ended 31 October 2017, showing that turnover increased £0.15m to £7.3m and group operating profit was up 25% to £1.8m. Chairman of the group, Nicholas Tucker stated: ‘I am pleased to report that operating profit for the year under review has increased by 25.21% (£358,000) after a 2.01% increase in turnover on the previous year’. Mr Tucker commented about current trading saying: ‘ I can report that the new year has started satisfactorily as well’.

• January LfL sales for British managed pub and restaurant chains increased 0.6% nationally, data from the Coffer Peach Tracker has found. London traded better than the rest of Britain in January, with collective LfLs up 1.6% compared to 0.4% outside the capital. Phil Tate, chief executive of CGA, stated ‘A string of site closures announced by some of the sector’s more high profile casual dining brands has done little to bolster confidence in the sector lately, but these latest figures suggest that overall the market remains relatively stable’.

• Sparkling wine sales are set to rise, with UK sales having increased 89% in volume and 206% in value over the last five years. Sparkling wine sales across the on and off trade exceeded 140m bottles in the 12 months to September 2017. The chief executive of the Wine & Spirit Trade Association, Miles Beale said: ‘To allow consumers to enjoy a wide range of quality sparkling wines, the WSTA is calling on the Government to redress the UK’s excessively high duty rates, which have helped leave Britain with the fourth most expensive alcohol prices in Europe’.

• The Times points out that Square Pie’s collapse has led to concerns over its mini-bonds — marketed as 8% ‘pie bonds’ on Crowdcube in 2015 — with 324 investors likely to lose all of their £655,000 investment. Crowdcube told bondholders to contact administrator KPMG about the failure, however, KPMG does not view the bonds as its responsibility as they are held by a separate company called Square Pie Bonds Plc, which is not insolvent.

• Two directors of Handmade Burger Company filed for bankruptcy while owing £1.2m to the business, which is in administration. A third director is preparing to follow suit, according to Propel. According to Handmade’s former accountants, ‘the three current directors are joint and severally liable for the overdrawn balance’.

• Midlands-based Peach Pub Company has appointed advisors as it looks into options for further growth after recently securing its 19th site, per MCA. Co-founder Hamish Stoddart commented: ‘Our aim is to raise enough equity to allow existing shareholders to realise some of their share value and to have access to equity as well as debt to grow the business.’

• The York Roast Co. who transformed the YorkyPub Wrap into an overnight viral success, are turning their York Stonegate venue into a diner and shop, re-opening in March.

• The number of restaurants in the US fell 2% to 647,288 units from the previous year. Bonnie Riggs, restaurant industry analyst stated: ‘The U.S. restaurant count is reflective of what’s happening in the foodservice industry today overall. To expand or not expand units is a calculated decision on the part of restaurant operators’.

• Christie & Co has been hired to oversee the sale of The Jamie Oliver Group’s two Barbecoa sites in Central London. The units, at One New Change and the thoroughfare of Piccadilly, are expected to garner international interest and will be sold unbranded.

• Domino’s has teamed up with Tinder, meaning people can order an extra large stuffed crust pepperoni pizza as they try to sort out a last minute date for Valentine’s day.

HOLIDAYS & LEISURE TRAVEL:

• STR reports US hotel room construction down 1.6% yoy for January continuing from December’s yoy decline of 3.7%.

• Network Rail’s new £47bn five-year-plan will see £2bn spent on the route from Waterloo station to the south coast, a 22% increase in funding. Becky Lumlock, route managing director for Network Rail’s Wessex route, said ‘our stretch of railway is one the busiest and most congested in the UK – we’re already running at capacity with 230m passenger journey a year, and that number is only set to rise.’

• According to TravelSupermarket, interest in holidays to Tunisia has surged 55% amid Thomas Cook resuming flights to the country. The operator as so far taken 15,000 UK bookings up to the end of the summer. Tui is to return to Tunisia with flights from the UK in May.

Other Leisure:

• Sky and BT Sport will pay £4.464bn to broadcast three seasons of Premier League matches starting from 2019/2020. The figure is a little short of the £5.136bn paid for rights in the 2015 auction, though 42 more matches are available to broadcast per season. Speculation remains that online giants such as Amazon, Facebook, Twitter and Netflix have shown interest in the remaining rights for midweek and bank holiday fixtures

• A gambling regulator has said online bookmakers must make more affordability checks before upgrading customers to VIP status. The Gambling Commission said online gambling firms were not making enough checks to spot harmful behaviour in customers.

ADMIN ETC.

• Langton is between offices. There is some light at the end of the tunnel but, for the moment, please communicate via email. MIFID II is now in operation.

START THE DAY WITH A SONG:

Yesterday’s song was When the Sun Goes Down by Arctic Monkeys. But today who sang:

When I am king, you will be first against the wall,

With your opinion which is of no consequence at all

What’s that?

RETAIL NEWS WITH NICK BUBB:

• Laura Ashley: The Malaysian controlled Laura Ashley has reported that first half PBT slumped to £4.3m in the 26 weeks to 31 December from £7.8m a year ago, because of the strength of sterling, and the Chairman, Tan Sri Dr Khoo Kay Peng, warns that “given the continued market challenges, the Board considers that net pre-tax profit for the year will fall below market expectations”, although separately the company says that trading over the last 6 weeks has been “within expectations”.

• H&M Watch: The embattled H&M will have hoped to avoid a Valentine’s Day Massacre of its share price after telling investors that “2018 is expected to remain challenging”, ahead of its first ever Capital Markets Day in Stockholm. And at first the share price rallied slightly, on the back of the forecast of a long-term return to growth, but it soon tumbled, by c8%, as the stockmarket focused on the short-term Q1profit warning and it closed only a bit above its intra-day low, at SEK 135, nearly 5% down. Bloomberg had a good article about it all, headlined “H&M Sounds Sour Note as It Puts Turnaround Plans on Stage”. H&M said it convened the event in an effort to provide more clarity about its plans, following criticism that the family-controlled business lacked transparency, and it broke out the revenue contribution of Online and the non-H&M brands for the first time,
but investors were evidently unimpressed with the talk of “jam tomorrow”…

• Footasylum: We said yesterday, after the “teach-in” for analysts on Tuesday afternoon, that there is much to like about the Footasylum business and its youthful management team. We were interested to hear CEO Clare Nesbitt, the daughter of the co-founder David Makin, say that she very rarely spends much time in the office and prefers to be out and about staying close to the core 16-24 customer base in gyms, sports events, festivals and on public transport. She also spends a lot of time in shopping centres, judging footfall trends etc, and was off to have another look at Westfield London at Shepherd’s Bush on Tuesday evening, to assess whether their store is in the right location. Footasylum pride themselves on their store selection strategy and only 2 mistakes have been made: one a small unit in Wilmslow (which was opened early on as a brand showpiece and will close when the lease
expires this November) and the other the small Oxford Street flagship.

• Westfield London Watch: Talking of Westfield London, we were surprised to see the other day that the big extension on the north side of the centre (on the site of the former M&S warehouse) is opening very soon, with the much-awaited 230,000 sq ft John Lewis store due to open its doors on March 20th.