Whitbread update, jobs, vacancies, Thwaites, DP Poland, holiday demand & other:

A DAY IN THE LIFE:

I can’t make my mind up whether ‘no-mow-may’ is a boon for wildlife or a charter for the lazy.

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Anyway, a bit tied up with admin today & so pushed for time. On to the news:

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WHITBREAD – Q1 TRADING UPDATE:

Whitbread has updated on trading during its first quarter and our comments thereon are set out below.

Headline comments:

• Whitbread says it has seen ‘continued market outperformance in the UK with Premier Inn total accommodation sales 27.2pp ahead of the market1, driven by the strength of our commercial and operational initiatives combined with the inherent strengths of our brand, scale and direct distribution.’

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EMPLOYMENT STATISTICS – UNEMPLOYMENT, VACANCY RATES, AVERAGE EARNINGS:

These numbers matter because, to a consumer-facing sector such as hospitality, labour is both a cost and a source of income for potential customers.

Real wage declines – depending on how you view it:

The ONS has reported that a material gap has opened up between the rate of increase of basic pay versus the rate of increase of basic pay plus bonuses. In the three month period to April 2022. This is a somewhat historic number but is important because the former is 2.2% below the rate of inflation for the year to the same date and the latter is marginally ahead.

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Unemployment numbers:

The rate of unemployment actually rose from 3.7% to 3.8% in the three months to April compared to the three months to March. On anything other than a very short view, this looks like a blip. The rate of joblessness remains near historic lows.

Vacancy rates:

The number of job vacancies in the country rose to a new record of 1.3 million from March to May per the ONS. Sourcing and retaining labour has been a major issue for hospitality for some time.

Comments:

The BCC says ‘an increasingly tight labour market means it’s much harder for employers to fill job vacancies – impacting on their ability to operate normally and retain skills in the business.’

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UKHospitality has said it is ‘concerning’ that the industry is facing 83% more vacancies across the board compared to March to May 2019.  Chief executive Kate Nicholls said ‘high vacancy rates are impeding our ability to trade. This is particularly concerning as we enter the summer, a key trading period for much of the sector.’

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PUBS & RESTAURANTS:

Lumina’s latest Eating Out Market Report has suggested that the UK eating out market is set to total some £95.2 billion in 2022, up 4% on its 2019 value. Whilst it’s a positive number, the pace of inflation means that costs are outpacing market growth.

Accountant Deloitte says that there has been a surge in London office refurbishment work…

Fleet Street communications agency has undergone a management buyout and changed its visual brand identity. The process saw co-founders Francis Patton and Arti Halai step away from the business, with Tess Pennington,  Mark Stretton and Steve Dann taking control.

Cost of living crisis:

With real wages now falling at their fastest rate in many years, the first of two payments to help the UK’s poorest households with the cost of living will be received from this week. The government says that over eight million UK homes on benefits will receive £326 by the end of July.

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COMPANY NEWS:

JD Wetherspoon has called on the govt to make sure tax between the on and off-trade is equal. The company outlined in the 12 months to July 2019, it generated £764.4m in tax, equating to about £1 in every £1,000 of all UK Government taxes.

Daniel Thwaites PLC has reported full year results for the year to end-March 2022 saying that revenues rose from a Covid-impacted £32.2m in FY21 to £96.0m in FY22. Operating profit was £13.3m (FY21: operating loss £9.4m) and PBT was £12.7m (FY21: loss £12.4m).

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DP Poland plc has reported full year numbers to end-dec 2021 along with a trading update…

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Pernod Ricard will invest €50m to make Irish Distillers’ Midleton Distillery carbon-neutral. The project will set out to eliminate scope 1 and scope 2 carbon emissions by the end of 2026.

Pret A Manger is set to launch in Spain and Portugal after reaching an agreement with Ibersol Group. Headquartered in Portugal, Ibersol operates more than 600 restaurants across Portugal, Spain and Angola.

Freedom Brewery, which launched its crowdfunding campaign yesterday morning, was able to announce that it had exceeded its £500k target later in the day.

Tonge Leisure, the Bolton based public house operator, led by Derek Tonge, has confirmed the sale of nine community pubs in the Bolton and Wigan area to Inglenook Inns and Taverns. Inglenook now operates some 55 units.

HOLIDAYS & LEISURE TRAVEL:

Maintained holiday demand:

A survey from Holiday Extras has found that just 14% of potential holidaymakers have considered changing their holiday plans this summer because of higher prices, with less than a third (31%) saying price was the most significant factor when choosing the location for their break.

But supply may be cut back.

Yesterday we commented on ‘pre-emptive’ capacity cuts by EasyJet. Thereafter, Tui UK MD Andrew Flintham has issued an apology for holiday disruption and pledged to support affected customers, saying ‘Our planes cannot take to the skies when the ecosystem is not working as it should be…the ecosystem experienced capacity issues’.

Other travel news:

A survey commissioned by World Travel Protection has found that  22% of corporate travellers were now on the road more often than they were before Covid-19 struck – although  larger organisations have been slower than SMEs to get back to previous levels of travel, with 71% currently travelling less frequently.

Unite is threatening summer strike action by cabin crew and ground staff at British Airways, claiming that BA went back on a pay deal. The union is also balloting 500 check-in staff on walk-outs that could be staged next month at the start of the summer peak.

FINANCE & MARKETS:

See Pubs & Restaurants for comment on labour market.

Sterling considerably weaker on stagflation fears. Fed announces today & Bank of England MPC rate announcement tomorrow. Oil price lower at $121.47. UK 10yr gilt yield up 5bps at 2.55%. World markets mixed to lower yesterday. London set to open around level.

FORTHCOMING NEWS:

Whitbread updates on Q1 trading today. Tortilla’s AGM is also Wednesday and 888 Holdings also hosts its annual meeting. Thursday will see the Bank of England’s MPC update on its latest interest rate decision.

RETAIL WITH NICK BUBB:

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