Deliveroo, Wales reopening, JDW, Loch Fyne, o/seas hols etc.:

A DAY IN THE LIFE:

The email has taken a bit more putting together than usual today due to a couple of factors:

• A lack of time yesterday as nobody, but nobody was available to clean and set up the BBQ. It had been sitting, forlorn, in the sleet and snow, half buried by leaves for six months or so and strangely, but not unexpectedly, its rescue was all down to me.

• And thereafter, having created my own mini-essay crisis by not getting down to any serious work, I then sat in the sun for several hours eating sausages and accidentally drank multiple beers.

And then the dog ate my homework but I would argue that none of the above was my fault. It was the weather, fate, the fact that we’re a quarter of the way through the year and I haven’t taken the Christmas cards down yet, something to do with the switch to British Summer Time etc but – as the news and Deliveroo’s IPO will wait for no man, let’s get down to it.

Anyway, as we’re gearing up for another Cultural Month summary next week and I’m just reading a book I should perhaps have read years ago, here’s a chance to ask about whom was it said: ‘He was rounder than the average undergraduate and wore more hats.’ Answer under Advertise With Us below.

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PUBS & RESTAURANTS:

Covid – the backdrop:

• With the weather rubbing it in that this is a major missed trading opportunity to fill beer gardens, UKH points out that more than a half of the UK population has immunity to the main strain(s) of Covid-19 either through having had the virus or having been immunised against it (or both, like Langton, which is both unlucky enough to have both had it and be old enough to have been vaccinated against it).

• Empty beer gardens look particularly lonely in the sunshine. UKH CEO Kate Nicholls tweets ‘over half the population estimated to be immune mid-March as acquired immunity through vaccines increases protection. Positive steps giving confidence in unlocking and removing restrictions 21 June.’ The ONS reports ‘we’ve published our latest antibody and vaccine data for the UK. We estimate that 1 in 2 people or 54.7% of the population in England tested positive for #COVID19 antibodies in the week ending 14 March 2021.’

• Langton comment. See premium email.

Covid-19 – Wales:

• The BBPA reports that ‘publicans and operators who run hundreds of pubs across Wales have today urged First Minister Mark Drakeford to provide them more support and clear dates on when they can expect to reopen once more.’ There are calls for more financial support and for a clear roadmap with dates. The operators ‘say they are at crisis point as they are not getting the financial support they need from the Welsh Government, nor have they been given dates yet or a roadmap on when they can expect to reopen their businesses as the vaccine rollout continues apace across Wales.’ Mr Drakeford has said that pubs may be able to open outdoors in late April, but the date for a full reopening indoors remains unknown.

• BBPA CEO Emma McClarkin says ‘Welsh pubs are in limbo, with no clarity on when they can expect to fully reopen nor the financial support they need to continue to survive in lockdown.’ She adds ‘we will continue to work closely with the Welsh Government but our pubs and publicans in Wales are suffering, and cash reserves are rapidly becoming exhausted.’ Ms McClarkin says ‘we need a clear indication with dates on when they can expect to fully reopen, as well as great increase in the level of support they are getting to ensure they can hold on.’

• Langton comment. See premium email.

Company lobbying:

• JD Wetherspoon has said it ‘is set to invest an initial £145 million developing new pubs and upgrading existing pubs – creating 2,000 new jobs in the process.’ But it says ‘the investment is conditional on the UK opening back up again on a long-term basis, with no further lockdowns or the constant changing of rules.’

• Langton comment. See premium email.

Companies & other news:

• Deliveroo Holdings plc has announced the price of its IPO as 390p per share. This is the bottom of the range of prices initially suggested. CEO Will Shu says ‘I am very proud that Deliveroo is going public in London – our home.’ He says ‘our aim is to build the definitive online food company and we’re very excited about the future ahead.’ The market cap will be £7.59 billion (including the new shares but excluding any over-allotment shares).

• Fuller’s has updated on trading and announced an accelerated book build to raise around £53m. There is also an issue of B shares. The company says it ‘started 2020 in an excellent position pre-Covid with a strong balance sheet, significant liquidity headroom and trading in line with expectations.’ This changed as a result of Covid. It says ‘revenues in the Group’s Managed Pubs and Hotels will be impacted accordingly and are expected to be c.80% less than the previous 12 months ended 28 March 2020.’ Fuller’s says ‘consumer confidence built quickly when the Group was permitted to reopen last summer and sales momentum returned rapidly with 79% of its pubs open by the end August which were trading at 78% of prior year levels, despite some restrictions remaining in place.’

• Pizza Union has reported delayed figures for the year to 29 Dec 2019 to Companies House. The numbers were signed in April 2020 and make little reference to Covid. The group operated 4 units for 11mths and opened a fifth in December 2019. Sales for the year rose from £6.7m to £7.7m with PBT up from £1.052m to £1.244m. Retained profits since incorporation in the balance sheet rose from £1.9m to £2.6m and shareholders’ funds rose from £3.4m to £4.1m.

• Manchester operator Hyde’s Brewery has reported yearly numbers to 29 March 2020 to Companies House. The figures were signed in June last year and make reference to Covid. Revenue for the year slipped to £29.4m from £31.4m with PBT up (on fewer exceptional items) to £0.82m from £0.43m in the prior year. Retained profits since incorporation (in 1912) were £21.7m and shareholders’ funds were £21.9m vs £20.7m in the prior year.

• Beds & Bars has reported full year numbers to 28 March 2020 to Companies House. The numbers are historic but the comments, as the accounts were signed off on 26 March this year, are not. Herewith the bald numbers, comment tomorrow. Revenue rose from £54.9m to £55.3m. EBITDA was down from £6.1m to £5.1m with PBT down from £10.4m to £1.0m. Retained profits are £8.7m and shareholders funds are broadly unchanged ta £17.5m.

• Time Out Group yesterday reported H1 numbers and announced its intention to raise c£15m via a share placing.

• DP Poland has updated on trading for 2020 saying that its performance has been in line with expectations. CEO Piotr Dzierżek comments ‘I’m very proud of the combined team of DP Poland and Dominium, and the pace of integration work that my fellow colleagues have progressed since January, despite the COVID-19 headwinds. We look to the future with optimism: we expect that fully integrating our IT infrastructure and systems will make the Enlarged Group more resilient to the ongoing impact of COVID-19, and we believe that we will be able to demonstrate the full potential of our combined business once dine-in services are allowed to resume in Poland.’

• Greene King has reportedly confirmed that it is in talks with the landlords of its Loch Fyne sites, ahead of making a formal decision as to whether or not to proceed with a company voluntary arrangement. A spokesperson from Greene King is reported as saying ‘Loch Fyne has been severely impacted by the Covid-19 pandemic and the resulting social restrictions. As such, we have started conversations with landlords ahead of making a decision to formally proceed with a CVA, which would enable us to hand back to landlords a number of sites which are already closed and no longer needed within the Greene King estate.’

• Langton comment. See premium email.

• Salcombe Brewery Co. says ‘while the last year has been incredibly challenging for our industry we have taken the opportunity presented by the lull in trade to open a second site.’ Yorkshire food manufacturer HECK says sales are up 21%. It is aiming for £50m of turnover.

• Alternative uses. Yesterday we commented on a closed Fenwick’s department store reopening as a hotel. Today, it’s a vacant former M&S department store in Hull that has been leased by the Dept of Work & Pensions to reopen as a large ‘temporary’ job centre. The story can be read in at least two ways, both indicative of current trends.

• Other news. Sales of sparkling wine in 2020 were reported to be down by around 8% on the back of the Covid-19 pandemic. The over-65s, now vaccinated, are reported to be ‘leading the way back to the supermarket aisles’ per Kantar. Online marketplace Everli has raised a $100 million in Series C funding. Staycation demand, see below.

The consumer:

• Opposing arguments are that either a wall of money will be spent by consumers in the next few months or consumers, worried by weakness in the jobs and housing markets, will pull in their horns still further. Bank of England economist Andy Haldane is in the former category. Tube fare rises and sluggish economic growth may suggest the latter. A short term bounce in spending is likely with a pause thereafter.

HOTELS & LEISURE TRAVEL:

• Holidays abroad arguably looking less and less likely this summer as The Guardian reports ‘the planet could have a year or less before first-generation Covid-19 vaccines are ineffective and modified formulations are needed, according to a survey of epidemiologists, virologists and infectious disease specialists.’ We get the picture. The more infections, the more mutations. Exposure to them for immunised people (e.g. Brits) self-selects for mutations that can bypass the vaccines (particularly the existing gen vaccines rather than the next-gen ones).

• The Guardian says ‘persistent low vaccine coverage in many countries would make it more likely for vaccine-resistant mutations to appear.’ This according to ‘88% of the respondents, who work across illustrious institutions such as Johns Hopkins, Yale, Imperial College, London School of Hygiene & Tropical Medicine and the University of Edinburgh.’ In relatively intelligible science-speak ‘new mutations arise every day. Sometimes they find a niche that makes them more fit than their predecessors. These lucky variants could transmit more efficiently and potentially evade immune responses to previous strains.’

• Langton comment. See premium email.

• There is plenty of lobbying going on ahead of the PM’s 5 April announcement. This had been expected on 12 April, but it has been brought forward. UK Inbound says there should be an attempt to encourage visitors to come to the UK (which could be a non-starter). It does point out that domestic tourists outlay just a third of the £685 on average a day in the UK spent by international travellers.

• Langton comment. See premium email.

• UK inbound CEO Joss Croft says ‘we have one chance to get the reopening of international travel right and the prime minister’s announcement on 12 April [this may now be 5 April] will be make or break for the inbound tourism industry.’ Mr Croft says ‘there is confidence to visit the UK in markets such as the US, and there is only a short window of opportunity to maximise this competitive position.’ The key decision will be whether overseas visitors are allowed to come or not.

• Other news. Spain has warned British second-home owners that they are not entitled to spend more than 90 days in the country. It has denied reports that they will be rounded up and deported, however. Fosun is to relaunch Thomas Cook’s millennial hotel brand Cook’s Club this summer. Analysts are predicting that Tube usage in London could fall permanently by a fifth. Moody’s says TfL will be hit far worse financially than peer operators in New York or Paris.

FINANCE & MARKETS:

• Consumer borrowing fell by 9.9% year on year in February as consumers paid back more than they borrowed. The drop was the largest fall in consumer borrowing in 27 years.

• The LSE has suggested that London house prices could fall. The LSE writes ‘there is a significant risk of policy trying to prop up house price growth. The implemented policies – such as the Stamp Duty holiday – are costly to the government and eventually are likely to be reversed.’ It says ‘if this coincides with an economic downturn there is a significant risk that the policy ends up triggering a housing market downturn, reinforcing the economic downturn.’

COMPANY ANNOUNCEMENTS (TUESDAY):

• Some company comment. For detail see yesterday’s Premium.

• AG Barr has reported full year numbers for the period to 24 January saying that revenues fell by 11.2% to £227.2m with PBT (before exceptional items) down by 12.3% at £32.8m. CEO Roger White says ‘we delivered a resilient financial performance in a year that was difficult for all.’ No dividend but ‘we remain committed to our plan to recommence dividend payments during the course of this financial year ending January 2022.’ Sky reports Rooney Anand close to buying ‘approximately 40 venues from Stonegate, owner of the Yates’s and Slug & Lettuce bar chains.’ The deal is said to be awaiting the approval of the Competition and Markets Authority. BrewDog says will open beer hotel in Edinburgh. Co-founder James Watt tweets the company believes it would be ‘great to open a beer hotel in the capital of our home country. Watch this space.’

RETAIL WITH NICK BUBB:

• See premium email.

TRADING STATEMENTS & EVENTS:

Upcoming results are set out below:

• 29 Mar 21 Ten Entertainment FY numbers

• 29 Mar 21 Brighton Pier Group H1 numbers

• 30 Mar 21 AG Barr FY numbers

• Est. 30 Mar 21 Time Out H1 numbers

• 31 Mar 21 Various Eateries AGM

• 1 Apr 21 Sportech FY numbers

• 7 Apr 21 Saga FY numbers

• 8 Apr 21 Sportech FY numbers

• 8 Apr 21 Constellation Brands FY numbers

• Est. 9 Apr 21 Barclaycard Consumer Spending (March)

• 13 Apr 21 Just Eat Q1 numbers

• 15 Apr 21 Pepsi Q1 numbers

• 15 Apr 21 Naked Wines FY trading update

• 22 Apr 21 Domino’s Pizza PLC AGM

• 23 Apr 21 Gear4Music results

• 28 Apr 21 Carlsberg Q1 numbers

• 28 Apr 21 YUM Brands Q1 results

• 29 Apr 21 Molson Coors Q1 numbers

• 4 May 21 Campari 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)

• 12 May 21 Compass Group H1 numbers

• 12 May 21 Stock Spirits H1 numbers

• 12 May 21 TUI H1 numbers

• 18 May 21 Britvic H1 numbers

• Est 19 May 21 Marston’s H1 numbers

• 26 May 21 C&C FY numbers

• 24 Jun 21 Bank of England MPC meeting

• 27 Jul 21 Campari 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

• 22 Oct 21 Intercontinental Hotels Q3 numbers

• 26 Oct 21 Campari Q3 numbers

• 8 Dec 21 TUI FY numbers

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