Langton Capital – 2021-04-23 – PREMIUM – Co accounts, R number, Fulham Shore, Deliveroo, Pernod, Heineken etc.:
Co accounts, R number, Fulham Shore, Deliveroo, Pernod, Heineken etc.:
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A DAY IN THE LIFE:
Well, I’m back in York and the frost’s killed my runner beans.
I mean, fifteen degrees and sunny during the day and minus three at night, what’s all that about? But more fool me for putting them out but when the packet said that in the north of England they should only be planted out in late-May. Of course, I thought ‘nah, I won’t do that, I’ll do this’ and, as is so often the case when overconfidence collides with ignorance, death and destruction has been the result.
Still, this is the death and destruction of a few beans we’re talking about. It’s not as though I was organising the response to Covid or the economic future of the country or whatever. That would have been harder to live down but, as we’ve a sunny weekend coming up, that’s quite enough of that. On to the news:
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PRIVATE COMPANY ACCOUNTS:
NEW WORLD TRADING CO:
• Christopher Topco, the parent company of 29-strong bar restaurant company New World Trading Co, (which includes the Botanist units) has reported full year numbers to 31 March 2020 to Companies’ House. The accounts may be rather ancient but the comment is more contemporary as they were only signed on 29 March this year.
• The numbers. The group reports revenues of £55.3m, up from £51.8m in the prior year. The group made an operating loss of £4.0m (2019: loss £430k) and there was a £27.8m goodwill impairment charge. This led to a 2020 loss before tax of £37.3m (2019: loss £5.7m. The prior year loss was largely caused by the £5.3m interest charge (repeated, broadly, in 2020) which is a function of how the group is financed.
• Regarding the write-down, the company says ‘at each reporting date the value of goodwill is reviewed to determine whether there is any indication that those assets have suffered an impairment loss. An impairment loss of £25,832,076 has been recognised in the year where the directors believe the carrying value of goodwill does not exceed the recoverable future cashflows relating to such goodwill. An impairment loss of £2,009,753 has been recognised in the year in respect of a small number of sites in New World Trading Company (UK) Limited.’
• Post the write off, Christopher Topco has a negative net worth of £50.9m, caused by accumulated losses since incorporation of £51.0m. Again, this is a function of how the group has been financed, but it is not altogether positive.
• Re Covid, the group says ‘in March 2020, the UK was placed in a national lockdown which required all sites to cease trading for a period of time. This placed considerable and unforeseen pressure on the group’s liquidity. Since then, we have communicated and negotiated with our debt providers, trade creditors, landlords and other creditors to ensure their support and to ensure our continued ability to trade and operate as a going concern.’
• The company says ‘this includes a renegotiation of our bank financing and an issue of Deep Discounted Bonds in December 2020. We have also benefited from government stimulus programmes, including the Job Retention Scheme, the reduction in VAT on food and non-alcoholic beverages, the suspension of business rates and business support grants.
• Going concern. This is exercising auditors at present. Christopher Topco’s accounts are prepared under the Going Concern basis. The company says ‘the directors have reviewed the group’s forecasts, projections and liquidity. Trading results have been significantly impacted in the subsequent financial year as a result of lockdowns, restricted trading circumstances and enforced closures, and these have continued into the first half of 2021. There remains uncertainty about the possibility of future lockdowns and the pace of recovery.’
• The company says it ‘is funded by a combination of bank loans, shareholder loans and cash from operations. As disclosed in the directors’ report, the banking facilities and the shareholder loans were refinanced in December 2020, providing an injection of new capital, and the directors now have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The government stimulus package, including a temporary reduction in the rate of VAT on food and non-alcoholic drinks, the suspension of business rates and the availability of grants to support re-opening will also provide headroom in the coming months. The Group continues therefore to adopt the going concern basis in preparing its financial statements.’
• The auditors, Grant Thornton, have not objected. But they have firmly passed the buck in saying ‘in preparing the financial statements, the directors are responsible for assessing the Group’s and the parent Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.’
• Pie Minister has reported numbers for the 12mths to 31 March 2020 to Companies’ House. Although the numbers are rather dated, the accounts were signed in November 2020 and make reference to Covid.
• The company reports revenue up to £17.3m from £16.6m in FY2019. The group made a profit before tax of £78k (2019: profit £349k). The group has shareholders’ funds of £1.5m, which didn’t move much as a result of the year’s trading. Trading will have deteriorated sharply towards the end of the period under review and the accounts to March 2021, when reported, will illustrate this.
• The company says that it closed its restaurants in March 2020 as mandated by the government. It says ‘in July 2020 we took the decision to reopen many of our restaurants and bring back to work many or our colleagues.’ The company adds ‘whilst we are able to operate under social distancing, it is clear that it will be sometime before the high street and footfall returns to pre Covid-19 levels.’
• The company says ‘the second national lock down in November has further impacted our restaurant sales during the busiest period and it remains to be seen whether there will be further lock down situations during 2021.’
• Well, we have news for the company, because there was.
• The company says ‘Pieminister has shown resilience and innovation even during these very difficult times and the Directors remain confident of our ability to operate under social distancing and continue to serve our existing and ever more important retail and digital channels.’
• The company has adopted the Going Concern principle and the auditors say they have ‘nothing to report’ on this (i.e. they agree. Or don’t disagree. There may be little legal difference)
• The auditors ‘draw attention’ to the company’s comments on the impact of Covid-19 but they leave it at that.
• Wordy legalese warning: In the note that the auditors make specific reference to, Pieminister says ‘when evaluating the issue of going concern, the Directors have considered not only the base profit and cash flow forecast for the next eighteen month period but have also considered extreme scenarios of further disruption to trading in the medium term that could pose a risk to the business. The Directors are satisfied with the results from those scenarios and are confident that with the multifaceted nature of the business; the excellent relationship with its lenders; the resources available to it; and the agility and adaptability of the management team that the company has adequate resources to continue in operational existence for the foreseeable future and therefore it is appropriate to adopt a going concern basis in preparing the financial statements.’
MARKET TOWN TAVERNS:
• Now owned by Heron & Brearley, Market Town Taverns has reported small company accounts (with no P&L) for the year to 30 Jan 2021, to Companies’ House. The financial year, which has only recently ended, includes a sustained period of closure with the rest of the year also impacted by Covid.
• The balance sheet shows that retained profits of £150k have been extinguished and replaced by a retained loss since incorporation of £2.2m. The company now has negative shareholders’ funds of £1.5m. In the prior year, the funds were a positive £780k. The numbers are not audited.
FULHAM SHORE – TRADING UPDATE & NEW SITE PLANS…
The Fulham Shore has updated on trading post reopening (outdoors only) our comments are set out below:
• Fulham Shore says that it has 70 of its 72 units open.
• Some are open for outside dining and others for delivery & collection (and some for both). The Company says ‘currently, 37 out of the 52 operational Franco Manca pizzeria and 16 out of the 18 operational The Real Greek restaurants have outside tables.’
• Fulham Shore says that ‘group sales in the week ended Sunday 18 April 2021 were very encouraging, being not only ahead of the previous week, but also ahead of the same week two years ago in April 2019 (as April 2020 was in the first lockdown, it is not comparable).’
• The company says ‘these trading results were achieved without any inside seating and our colleagues in the restaurants deserve great credit as demand has far exceeded the number of seats available at peak times.’
Ahead of 2019:
• Fulham Shore is ahead of 2019. Open Table has elsewhere today reported that reservations and diner numbers are still well below pre-covid levels.
• Speaking for the wider industry, it says ‘this encouraging trend continued throughout the first week of opening, with UK wide figures showing that on average, seated diner numbers were only down by 38% over the first seven days compared to the same period in 2019.’
• Fulham Shore is, as it has said, up on 2019
Re site opening programme:
• FUL says that ‘encouraged by these figures, the Group continues to identify potential new locations for our two businesses. In the last two weeks, we have inspected sites in many towns and cities across the UK including London, York, Durham, Newcastle, Edinburgh, Glasgow, Cardiff, Liverpool and Manchester, for either new or additional sites.’
• The company says ‘many of the restaurant locations we are seeing are available as a result of insolvency events and, as a result, are typically pre-existing fitted units. Sites of this nature have a lower opening cost to the Group compared to shell units.’
• It says ‘we therefore expect a reduction in the Group’s average capital expenditure per new site in the short term, and that this should improve our return on capital.’
• FUL adds ‘the Group continues to be presented with a number of excellent potential retail locations, almost on a daily basis. The Board hopes that Fulham Shore can contribute towards the revival of town centres with new restaurant openings as the COVID-19 restrictions ease.’
• In the very short term, the company says ‘we are currently in the process of building two new Franco Manca pizzeria: on High Holborn in London and on Mitchell Street in the Merchant City, Glasgow, with opening dates scheduled for June 2021.’
• FUL concludes ‘the Board believes that the next few months may be the most exciting in the Group’s short history and looks forward to opening our restaurants fully once permitted and capitalising on the property opportunities that are being presented to us.’
• The fact that Fulham Shore’s sales are ahead of the same period two years ago with maybe only 30% of its space open (and delivery) is very positive.
• And remarkable but, as we have commented on a number of occasions, there will be winners within what is a currently-troubled restaurant sector.
• The sector had been suffering from overcapacity (as witnessed by the CVAs in 2018) before Covid struck but the pandemic has put a number of companies out of business
• Others will slim down their estates and moderate their new opening programme going forward whilst some others, Fulham Shore amongst them, will be a beneficiary
• Sites are now more available and cheaper and the group’s track record of providing what customers want, where they want it and at a price they are prepared to pay, is paying off
• Provenance, authenticity, value for money etc. will remain important factors going forward
• The company is a winner in its field & now has now decided to step up its opening programme at a time when sites are more widely available and competitors are unable to step up to the plate
• The group has the flexibility to reduce debt but it has decided that the time is right to increase outlet numbers. This is a sign of confidence.
• Over the longer term, we expect FUL to prosper. It is selling an attractive product at an attractive price. The company has suggested in the past that both its Franco Manca and its Real Greek chains could triple in size and we believe that this remains a reasonable ambition over the medium term.
PUBS & RESTAURANTS:
• The NIESR has produced its weekly estimate of the R number in the England, saying that they believe it is in the range 0.8 to 0.9 in the period up to 20 April. The NIESR says that the number in Northern Ireland is higher, at around 1.025 and in Wales it is 0.875. In Scotland, it is in the range 0.8 to 0.9. The NIESR says ‘based on our model, by 17th May when step 3 re-opening is due to restart, we expect the trend value of daily cases to be around 600; admissions to be below 50, and deaths to be well below 25.’
• Langton comment. This is unchanged and in line with expectations and also in line with the continued opening up of the economy. No change to the belief that indoor hospitality will be allowed to reopen on 17 May.
Covid inspired changes:
• Alix Partners suggests that Covid-19 anxieties are driving significant changes in consumer behaviour. It says ‘consumers across the board have had to learn new behaviours and adopt new habits in their everyday lives.’ It says ‘while many will go back to spending through familiar pre-pandemic mechanisms, others will not abandon behaviours learned during this period anytime soon.’
• Alix Partners says ‘people have been riddled with anxieties about finances and physical as well as mental health over the last year. Our study has found that consumers who have felt the most vulnerable are more likely to exhibit permanently changed habits. Significantly, the survey found that these consumers span all age groups, genders, income levels, and locations.’ Just how this will impact behaviour going forward is one of the most important questions facing the hospitality industry as it emerges from the pandemic.
• Langton comment: There are plenty of questions and quite a few observations at the moment – but arguably precious few answers. It is self-evident that Covid has been a shock to the collective system and it has forced changed habits over the recent past and into the short term future. It is conjecture to say much else. Wanting something (a wall of money, pent up demand etc) isn’t proof that it actually exists though we believe, fingers crossed, this is a reasonable belief at the current time.
• It is true that pandemics have happened in the past and pubs, restaurants, hotels and leisure travel always bounced back. So is it different this time? Possibly – but what does that mean and what grounds have we to believe that it would it be?
o Certainly the pace of technological change is faster now than perhaps at any time since the 1900-1920 period when motor cars, planes, radio and telephones became an everyday reality.
o Coincidence, correlation and causality. The Spanish Flu didn’t finish off horse drawn carriages, but it did coincide with it. Other things are correlated but not causal – so where does Covid 19 fit in? We would suggest that the move to delivery, cashless trading, remote ordering apps and the like is coincidental. The trends were in place already.
o On a more positive (at least for the tenant) note, Covid could actually have been causal in accelerating if not actually causing the swing away from upward only, five year rent reviews where all of the economic risk was taken by the tenant. CVAs were numerous in 2018 but Covid is in a different league.
• Some changes thought to be permanent. Alix Partners says ‘in every industry, COVID-19 has changed the way business is done.’ It quotes executives as saying the Covid forces ‘are permanently altering their strategies to succeed in this new normal.’ It says, re the consumer, that ‘behaviours learned during this period will have long-term implications across demographic categories and geographies.’
Returning to venues:
• Lumina Intelligence reports ‘as coronavirus cases fall and some semblance of normality returns, consumers feel increasingly confident heading to store, resulting in online retail losing share of breakfast, lunch and dinner occasions.’
• Langton comment: There are no numbers that we have seen yet – but this is the $64,000 question for the delivery companies (see comments on Just Eat, Deliveroo and Uber Eats below). Will delivery fall when sit-down eating goes up – or will it expand the market.
• We think both things will happen. Delivery will have expanded the market but delivery sales will also fall when consumers have more choice (they can spend in restaurants) and less money (they have spent it in restaurants). Extrapolating revenues from a pandemic trading period may prove to have been based on faulty logic. That said, and we have only had a little feedback, delivery is holding up remarkably well with some operators.
• Lumina says ‘pent up demand has led to a successful first couple of weeks of trading for the hospitality industry. This looks set to continue as restaurants, pubs, bars and cafés all record a positive channel opportunity which is a first since data collection began.’ It says ‘despite cooler weather, operators have responded creatively.’
• Langton comment. Two things here, a) yes, there is some pent up demand and 2) it was cold in Granary Square on Wednesday evening and the pub’s heating broke down. That said, Lumina is right, many (though by no means all) operators have made a real effort and, as the sun returned yesterday, it seems to be paying off. Regarding the pent up demand, we believe that this is a) real but b) finite. This is why, amongst other reasons, we are very confused as to why operators that are able to reopen their units, have not already done so. As some of the supermarkets say about products remains true about consumers’ spending power – when it’s gone, it’s gone.
• Lumina reports that ‘online supermarkets saw a -8ppt decline in channel opportunity as consumer routines change, resulting in more shoppers returning to in-store shopping.’ They have always been able to shop in-store for food, of course, so this seems to be coincidental with the reopening of restaurants rather than having been caused by it.
• Open Table has reported that restaurateurs are feeding back that their eateries are at full capacity, as diners return while the UK eases out of lockdown. Capacity is down, of course, and Open Table goes on to say that reservations and diner numbers are still well below pre-covid levels. It says ‘this encouraging trend continued throughout the first week of opening, with UK wide figures showing that on average, seated diner numbers were only down by 38% over the first seven days compared to the same period in 2019.’
• Open Table3 says ‘over the weekend (Friday 16th April – Sunday 18th April), seated diner numbers were at minus 36% on Friday, minus 40% on Saturday and minus 38% on Sunday compared to the same period in 2019, as diners enjoyed much missed brunches, lunches and dinners on the first full weekend of opening outdoor spaces.’ In Manchester, however, numbers were ahead of 2019. It says ‘on average throughout the week, the restaurant reservations in Manchester were up 5% compared to 2019 levels.’
• GfK has updated on UK Consumer Confidence saying that its Index increased one point to minus 15 in April. It says ‘confidence has edged up one point in April with consumers taking a more guarded view on the future. The picture for personal finances in the coming year remains strong at +10 and there is another big uptick in our view of the general economic situation in the next 12 months, with a six-point boost in April following the 13-point increase in March and the 14-point jump in February.’
• GfK says ‘this clear trend of growing confidence reflects the forecast of a rebound for our economy during the second half of the year. The improvement in the consumer mood since January is welcome but the pandemic has hit household finances hard and, on the road ahead, we will still see concerns over new variants, rising inflation and the debt overhang. Nevertheless, there’s every chance that as the recovery gains momentum and the numbers get stronger, confident consumers will continue to spend and drive the wheels of UK finances into the summer and beyond.”
Other Covid news:
• Alix Partners reports that ‘disruption is the new economic driver.’ It says that ‘cycles of disruption, which displace existing businesses, markets, and value networks in favour of newer ecosystems and relationships, have emerged as the central strategic challenge for business leaders today.’ It says ‘new technologies accelerate the pace of change at a rate not previously experienced in history. New business models and entrants, unburdened by the past, upend the status quo.’
• Langton comment. This seems to be true but, at the end of the day, the new business models will need to be able to make money. Just ask Deliveroo. Alix Partners goes on to say that accelerated change means losers are perhaps going to the wall quicker (or at least with a greater degree of certainty) than they were in the past. It says there are ‘forces that are driving greater disparities between the top and bottom performers in industry.’
• Other worries. Alix Partners says that ‘COVID-19 wasn’t the top concern for most businesses. Despite the pandemic’s immediate and pervasive dislocations, numerous disruptors (such as new and evolving competition, technology-impacted processes, AI, and regulation) are viewed by executives globally as having higher magnitude and longer-term impact . This underscores how far-ranging and dynamic the forces of disruption are in today’s business climate.’
Company & other news:
• The Pubs Governing Body Scotland says that The Tied Pubs (Scotland) Bill, which has now passed into law ‘gives about 700 Scottish tied pubs similar rights to those in England and Wales. It will also lead to the publication of a statutory Scottish Pubs Code and the appointment of a Pubs Code Adjudicator to enforce the rules.’ It says that it (The Pub Governing Body Scotland) ‘is the organisation responsible for promoting the advancement and improvement of landlord (pub-owning companies) and tied tenant relationships in the Scottish licensed retail sector.’
• Deliveroo. The FT reports that ‘Odey Asset Management has revealed to clients that it took a short position against Deliveroo’. It says this is ‘the first sign that hedge funds are targeting the food delivery company after last month’s disastrous initial public offering.’ The FT goes on to say ‘Advisers said at least three hedge funds had taken an early short position immediately after the float, in what one banker described as “the worst IPO in London’s history”’
• Langton comment: In terms of money ‘lost’ the Deliveroo IPO is perhaps the worst in London’s history. The shares fell another 1.3p yesterday to a new low of 231.7p. It seems unfair to blame shorters. They, the shorters, simply take a negative position on companies towards which they hold negative financial feelings. They only do this if they think that the company is bad or overpriced or both. In the short term, at least, they have got this one right.
• Uber is to launch in Germany for the first time shortly in an attempt to break what it calls Just Eat Takeaway.com’s “monopolistic” stranglehold on the delivery market there. Uber told the FT ‘Europe in particular has been a bright spot for [Eats], both in terms of some of the growth we’ve seen, but also, frankly, in terms of the strengthening of our market position.’ Some 24m people in Europe used Uber Eats to order meals from more than 126,000 restaurants last year.
• Langton comment: the outlook for Deliveroo. Combine a few of the above stories. We have delivery facing a resurgent restaurant industry and therefore potentially about to see its market shrink (or at least growth stall), we have the shorters betting real money that Deliveroo’s shares will fall and we have Uber entering the German market in a sign that, even if it remains a growth market for some time to come, delivery is also an extremely competitive space.
• Pernod Ricard has reported a return to organic sales growth in its financial Q3 and expects 10% profit growth in FY21. The company says sales growth picked up sharply in Q3 vs Q2. Pernod Ricard says ‘our Q3 was excellent, marking a return to organic Sales growth for 9M FY21. This confirms the strength of our business, with strong dynamism of our domestic Must-win markets and good resilience throughout. In a still uncertain and volatile global context, with the current information available on the pandemic, we will continue to implement our strategy while actively managing resources, in particular strongly reinvesting where efficient.’
• Heineken has reported flat beer sales in Q1 this year with increases in Africa and Asia offsetting lower on-trade volume in Europe. Net profit for Q1 was €168m, up 79% on Q1 last year but still down by 44% on Q1 2019. On-trade volumes in Europe in Q1 were down by around two thirds. Comps will be much easier in Q2. The company says ‘we had a solid start to the year, despite facing severe restrictions across many markets and the closure of the on-trade in Europe due to the pandemic. Overall beer volume was in line with last year, with strong growth in Africa, Middle East & Eastern Europe and Asia Pacific and modest growth in the Americas.’
• Oakman Group has reported on current, post-reopening trading saying that the company ‘has been encouraged by an excellent first full week of trading figures since customers were allowed to return to a pub environment, albeit for outdoor-only service.’ It says LfL sales were up 34.3% on the same week in 2019. That is impressive. Chairman Peter Borg Neal says ‘these sales are way above our expectations, particularly given that the Like-For-Likes are against Easter 2019.’ CEO Dermot King says ‘whilst it is difficult to make direct comparisons, given the locational and spatial advantages our sites enjoy, we have clearly outperformed the wider market which was 21% down on like-for-like sales.’
• Yorkshire drinks manufacturer Corinthian Brands reports that it has received an eight-figure funding package to support a management buyout.
• Silent Pool Distillers has released “the world’s first commercially available” gin in a paper bottle – Green Man Woodland Gin.
HOTELS & LEISURE TRAVEL:
Domestic holidays booming:
• Travel Weekly says ‘domestic operators have reported a return to pre-pandemic sales levels for UK holidays amid a lack of clarity on overseas travel and strong agent support.’ Hoseasons says 2021 bookings are up 22% on last year and Shearings is seeing ‘very strong’ bookings. TW says ‘agents expect the dramatic increase in demand for UK breaks this summer to lead to a long-term shift to more domestic travel sales through the trade.’ It quotes one operator as saying some customers, who might formerly have booked an overseas holiday, are ‘looking for ‘nostalgia travel’.
Overseas markets etc.
• Spain’s tourism minister, Fernando Valdes, has told Sky News ‘we are desperate to welcome you [British tourists] this summer so I think we will be ready here in Spain.’ He adds ‘certificates are going to help us. Since the beginning of the pandemic we have tried to put in place different means to help safe tourism.’
• Ryanair’s Eddie Wilson says he believes consumers are “going to demand to travel” as vaccination programmes roll out. He says ‘it’s going to happen very suddenly. There’s no doubt that once death rates go down and the pressure comes off hospitals, people will want action fairly quickly.’
• IATA has said that a slow global vaccine rollout programme has meant that airlines will lose $10bn (£7.2bn) more than previously predicted
• Costa, owned by Carnival Cruises, has announced its 2021 Mediterranean cruises with summer itineraries starting in May
• Music Magpie finished its first day’s trade as a public company at 196.5p, up some 3.5p on the issue price.
FINANCE & MARKETS:
• A Reuters’ poll of economists suggests the US economy, the largest in the world, will grow by 6.2% this year. The IMF says 6.4%.
• Norway’s sovereign wealth fund says that the Covid-19 pandemic is becoming less of a fear in world markets with other risks, such as inflation, coming to the fore
• The number of homes sold in the UK hit a record in March of over 180,000 sales.
• Sterling weaker at $1.3862 and €1.1524. Oil higher at $65.80. UK 10yr gilt yield unchanged at 0.74%. World markets heading lower yesterday and London set to open down around 31pts.
RETAIL WITH NICK BUBB:
Planet ONS Watch: We noted yesterday that, in the real world, as per the BRC-KPMG figures for March (the 5 weeks to April 3rd), underlying Retail Sales were strong last month, given the anniversary of the first “lockdown” of “non-essential” Non-Food shops on March 23rd last year and the boost from the earlier Easter this year, and “seasonally adjusted” life was also strong on that strange parallel world, the Planet ONS (aka the Office of National Statistics in Newport), via their official Retail Sales figures, which were released at 7am this morning…City economists (who treat the ONS figures as the gospel truth, alas) will be very pleased by the 5.4% jump in month-on-month seasonally adjusted sales volume (inc fuel), as that was much better than expected, helped by a useful recovery in fuel sales. The ONS non-seasonally adjusted value sales (ex-fuel) were as much as 9.3% up in March
Consumer Confidence Watch: After today’s latest survey from the widely followed monthly GFK Consumer Confidence index, it’s again worth noting that the record -39 index low seen in July 2008, during the financial crisis, was not tested in the pandemic crisis…The overall April 2021 index only edged up to -15, from the -16 level that was seen in the report for last month (versus the -36 low seen in the early June 2020 “flash” report), despite the successful COVID vaccine roll-out. A Reuters poll of economists had pointed to a bigger improvement in the overall index. GfK’s Client Strategy Director Joe Staton says in the press release that “The pandemic has hit household finances hard and, on the road ahead, we will still see concerns over new variants, rising inflation and the debt overhang”.
BDO High Street Sales Tracker: Given the impact of the first lockdown on “non-essential” stores a year ago, Retail Sales figures are hard to measure at present and although today’s BDO High Street Sales Tracker for medium-sized Non-Food chains was bound to paint another very strong picture for w/e April 18th, since the comps were very soft, BDO continues to let itself down with its suspect methodology…The BDO index is just an unweighted average of the percentage changes in the sales of their reporting retailers and so it shouldn’t be taken too literally, as the reported outcome for last week was again very silly! BDO Fashion LFL sales were up c82% (with Fashion Store sales said to be up by 482%) …and Total BDO LFL sales (including a handful of Homewares and Lifestyle retailers, as well as the Fashion retailers) were, laughably, said to be up by no less than c998% (up c26,588% in Store
Next Week’s News: A busy week kicks off on Tuesday morning with the latest monthly Kantar grocery sales figures, closely followed by the Travis Perkins AGM/EGM. Wednesday then brings the first dealings in the demerged Wickes, along with the Sainsbury finals, the Dixons Carphone pre-close update, the French Connection finals, the Pendragon AGM and the Apple Q2 results (in the US). On Thursday we then get the Howden Q1, the WH Smith interims and the Inchcape Q1.