Langton Capital – 2021-06-09 – Corporate Long Covid, rent overhangs, WFH, Carluccio, staycations etc.:
Corporate Long Covid, rent overhangs, WFH, Carluccio, staycations etc.:
A DAY IN THE LIFE:
Holidaying in the UK is always an experience.
Good, usually. The pubs are predictable and they sell what you think they are going to sell – but there are some areas where the Lycra can get a bit visibly painful and the backpacks and walking sticks seem to be some kind of virtue signal rather than an aid to any serious walking.
Or, indeed, any serious pottering from pub to pub which, in our opinion, is much more virtuous in any case. Still, we’d better draw those type of comments to a close before we upset any walkers or cyclists out there. On to the news:
ADVERTISE WITH US:
Langton’s free email now carries adverts. See front page of website for today’s copy & contact us for further details.
CHANGED EMAIL FORMAT:
The Premium Email is unchanged. The Free Email is written and pre-sent the evening before. It may not include breaking stories nor Langton comment. See Twitter for in-day comment. Let us know if you would like an example of the Premium Email.
Prices: £295 for one subscription, £495 for multiple, both plus VAT. Or sign up for easy in, easy out monthly option:
LATE BREAKING NEWS – See premium email for detail.
SSP Group – H1 numbers: SSP Group, which in March launched a fully underwritten Rights Issue to raise £475m on a 12 shares for 25 held at 184p per share basis, has this morning reported H1 numbers. The group says revenue of £256.7m was down 78.8% at constant currency; down 78.9% at actual exchange rates.
• Confidence. The ONS reports that ‘pub landlords’ “high confidence” about their future business survival has peaked above 20% for the first time…since November 2020.
• 21 June relaxation. Sky reports ‘pub bosses have appealed for the easing of COVID restrictions across the UK, saying the delayed Euro 2020 football championship offers the perfect opportunity to help the industry and beyond recover.’
• Re staffing, the ONS comments on furlough.
• The Telegraph reports the labour crisis is ‘deepening.’
• Move online. The covid pandemic, perhaps unsurprisingly, has led to a surge in online shopping, browsing and the like.
• The Inn Collection Group has opened its first Wearside site, The Seaburn Inn on Sunderland seafront.
• Travel Weekly research has suggested that ‘uncertainty about the restrictions on outbound travel had little impact on UK consumers’ intention to take overseas holidays this year.’
• The BBC says that camp site rules should be relaxed to allow pop-up sites if the demand is there (as it may well be).
• Travel restrictions have been eased somewhat in the US for several countries but not for the UK.
PUBS & RESTAURANTS:
Covid overhang fears:
• UKH has coined the “economic long covid” phrase in referring to the overhang of financial and other issues facing the sector. It says the crisis could have a lasting legacy if the government does not provide more support. UKH’s Kate Nicholls says ‘current government support is not sufficient to cover the sustained hit on revenues that businesses in the sector have suffered following months of lockdown and more than a year of tough trading restrictions. Average hospitality monthly costs are between £10,000 and £20,000, while the average government support is £3,000 per month.”’ UKH calls for the government to stick to its own roadmap towards lifting restrictions.
• Langton comment: See premium email
• UKH has commented on the proposal to create a new watchdog to protect workers’ rights saying this ‘is a positive step and we look forward to working closely with officials, to help shape best practice guidance. The vast majority of hospitality businesses are good employers and treat their employees with respect, so any moves that prevent them being undercut by the few companies who aren’t treating their workers in the right manner is welcome.’
• The MA writes ‘UKH boss Kate Nicholls has defended pub bosses who have had to lay off staff since the start of the pandemic despite job support schemes.’ Ms Nicholls says ‘hospitality remains in a fragile state with a quarter of venues still closed and it will need time to recover fully.’
• No-shows and deposits. The BBC reports that no-shows are impacting hospitality businesses and says that deposits are in some cases being introduced in order to incentives bookers to actually turn up.
Rents & debt:
• See Long Covid above. UKH has said that failure to oblige landlords to forgive some rental debts could lead to a long covid impact on hospitality.
• Langton comment: See premium email
• Talking about the lifting of the moratorium on commercial evictions due to take place at the end of this month, UKH says ‘we have a very real problem on our hands if the moratorium is lifted without a resolution being put in place.’
Working from home:
• The debate as to what commuters could, should and will do continues to rage. The US is facing similar issues. There, Restaurant Dive days ‘Manhattan employers expect 29% of employees to return to the office by the end of July, a number that is expected to rise to 62% by the end of September.’
• Langton comment: See premium email
Company & other news:
• Boparan Restaurant Group says it plans to launch 500 sites under its new Caffè Carluccio’s coffee shop concept in the next five years.
• Gordon Ramsay is reported set to open his biggest Street Burger restaurant to date in July at the O2.
• Waitrose is reportedly considering the sale of The Good Food Guide.
• Oakman Inns has updated on trading saying that it has seen strong trading and good staff retention. Talking about sales, CIO Steve Kenee says ‘without wanting to oversell it, [sales] have been nothing short of phenomenal.’
• Bloomberg’s Business Insider reports that the mighty Starbucks is to cut 25 menu items and ingredients due to supply issues.
HOTELS & LEISURE TRAVEL:
• Cabinet minister George Eustice has said Britons should “holiday at home” for a second successive summer. He told Sky “I will be staying at home. I have no intention of travelling or going on a holiday abroad this summer. Some people may, but they have to understand that there are obviously risks in doing so because it is a dynamic situation. I think most people will probably decide this year to stay at home, holiday at home.”
• Sky, which has warmed to its task, says that ‘Downing Street has not ruled out the prospect of the prime minister embarking on a foreign break this summer, as the travel industry reacted with dismay to a minister telling Britons to holiday at home this summer.’ George Eustice has said he will not holiday abroad but no10 says ‘we wouldn’t speculate on the PM’s plans and will set out any details in the normal manner.’ This could be read either way.
• Matt Hancock has said there will be no significant additions to the green list of countries (returning from which you do not need to self-isolate) in the “medium term.”
• RBH Hospitality Management says that daycations could be a big thing this summer (rather than staycations) as capacity may run out. The comment was based on analysis of Google search terms such as ‘day trips near me’ and ‘day trips from London.’
• STR reports that the CEOs of global hotel brands expect hotel demand to come back ‘more quickly than outside observers would expect.’
FINANCE & MARKETS:
RETAIL WITH NICK BUBB:
TRADING STATEMENTS & EVENTS:
Upcoming results are set out below:
• 8 Jun 21 DP Eurasia AGM
• Est 13 Jun 21 Barclaycard Consumer Spending report
• 15 Jun 21 Vianet full year numbers
• 15 Jun 21 On the Beach H1 numbers
• 22 Jun 21 Coca Cola HBC AGM
• 24 Jun 21 Bank of England MPC meeting
• 8 Jul 21 Fuller’s FY numbers
• 13 Jul 21 Pepsi Q2 numbers
• 23 Jul 21 Premier Foods AGM & Q1 update
• 27 Jul 21 Campari H1 numbers
• 27 Jul 21 Games Workshop FY numbers
• 3 Aug 21 Domino’s Pizza 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
• 19 Aug 21 Rank FY numbers
• 22 Oct 21 Intercontinental Hotels Q3 numbers
• 26 Oct 21 Campari Q3 numbers
• 8 Dec 21 TUI FY numbers
LANGTON CAPITAL: Made in Hull. Like all the best things. Langton Capital is a financial advisory company providing insightful views on the UK and global leisure industry and the wider consumer sector in general. Subscription to the daily email is free. Unsubscribing is painless. We provide daily off the shelf and bespoke research. We have helped with transactions, fund-raisings, disposals and other corporate issues. We have a good ear, we are impartial, independent and not half bad at what we do. If you think that we could help you or your business, drop us a line.