Langton Capital – 2022-07-20 – CPI numbers, Tracker, labour issues, Shepherd Neame, NFX & other:
CPI numbers, Tracker, labour issues, Shepherd Neame, NFX & other:A DAY IN THE LIFE: We’ve got a puppy and, as passport renewal problems and a dearth of people willing to dog-sit for us will be keeping us in the UK, we’re looking at staycation cottages. Many of which say they’ll allow one well-behaved, small dog to stay in the property hence we’re working on the basis that two out of three isn’t bad. Or maybe even three out of four because there’s only one of her, she’s definitely a dog and she is, at the moment at least, small. The well-behaved bit perhaps not so much but, if you view that as an aspiration rather than a demand, we’re home and dry with all four requirements met. Anyway, we’ll continue to do our bit for the domestic hospitality industry this summer and, with that in mind, we’d better get on and book something. Here’s to a somewhat cooler day and on to the news. LANGTON EMAIL: The Free Email is now written in short form. Extended versions of many stories are in the Premium Email. Reply to this email if you would like to upgrade. Prices for the Premium at time of writing are £345 for one subscription, £595 for multiple, both plus VAT. Or sign up for easy in, easy out monthly option HERE TRACKER NUMBERS FOR JUNE: CGA has reported that ‘hospitality groups’ like-for-like sales up 5% in June, but inflation bites.’ It says that the Jubilee holidays helped restaurants, pubs and bars to solid growth but it adds that London trading dipped back below pre-COVID-19 levels after the rail strikes. This ‘represents the strongest month of like-for-like growth since the start of 2022. However, June’s figures are skewed by the Queen’s Platinum Jubilee, which provided two Bank Holidays against none in June 2019. The growth is also below inflation as measured by the Consumer Price Index, which recently topped 9%…’ • See premium. Reply to this e/m to see a sample of the full email and / or to upgrade. PUBS & RESTAURANTS: Labour & real wages : Although views may differ about which inflation figure to use to deflate nominal earnings, the press seems in no doubt that ‘regular pay is falling at the fastest rate since 2001 when taking into account rising prices, official figures show.’ That from the BBC. The above is not lost on organised labour, which is responding in a predictable though untried-for-decades manner, namely by going on strike. • See premium. Reply to this e/m to see a sample of the full email and / or to upgrade. Inflation: The ONS this morning has announced that the Consumer Prices Index (CPI) rose by 9.4% in the 12 months to June 2022, up from 9.1% in May. It says ‘on a monthly basis, CPI rose by 0.8% in June 2022, compared with a rise of 0.5% in June 2021.’ The ONS adds ‘food and non-alcoholic beverage prices have risen by 9.8% in the year to June 2022, up from 8.7% in May, and the highest rate since March 2009…’ • See premium. Reply to this e/m to see a sample of the full email and / or to upgrade. In addition to today’s news on the CPI from the ONS, Kantar reports that annual grocery bills have risen by £454. Kantar Worldpane4l says that grocery price inflation was 9.9% in early July, the second-highest level it had ever recorded since comparable records began in 2008. • See premium. Reply to this e/m to see a sample of the full email and / or to upgrade. Other news: Giving a view as to what the main drivers are in the off-trade, Premier Foods has updated on Q1 trading today saying that sales are up 6% and that the co remains ‘firmly on track to deliver full year expectations…’ The co says that ‘we have made good progress in recovering our input cost inflation through a range of measures, including cost efficiencies and pricing, and we continue to monitor the situation closely. Consumers are increasingly looking to cook tasty affordable meals at home; this fits well with our broad portfolio of brands and was illustrated by the strong performance of Batchelors and Nissin in the quarter. With this positive trading momentum behind us, we remain firmly on track to deliver our expectations for the year…’ Sacha Lord, NTIA Chairman and one of the UK’s four Night Time Economy Advisers, has called on the Government to ease visa rules to stem the jobs crisis hitting the hospitality sector… The latest Bloomberg Pret index concentrates on the bigger picture, saying the purpose of it was always ‘to track the economy’s return to normality using transactions at Pret A Manger Ltd.’ It says numbers showed ‘whether hundreds of thousands of bankers, asset managers and corporate lawyers were repopulating those areas [city centres] as firms recalled workers to the office’. WFH. Whilst Pret data above shows the West End lagging, Shaftesbury Capital CEO Brian Bickell has told City AM that the West End will bounce back quickly after what could be a quiet period as a result of the heat… The BII has said the heat has obliged a number of pubs to close in order to keep staff sate. Travel will have been difficult yesterday (and rolling stock will be out of place today) as a result of cancellations of rail services due to the hot weather. There were no services into or out of King’s Cross and cancellations yesterday pushed what should have been a 2hr journey out to around 5hrs… The FT reports that leading retailers have urged the UK government to pass on an expected reduction in business rates as a result or re- and de-valuations of assets immediately. One property consultancy believes around £1bn in excess rates should be handed back to retail. Sunscreen and ice cream sales have shot up. Wet sales should have been good though with the temperatures as high as they were, many consumers may have stayed at home. Subscriptions, one of the un-lockdown losers. Netflix is reported to be expanding its push to charge people for sharing accounts. COMPANY NEWS: Shepherd Neame has announce that it has ‘expanded its estate with the acquisition of contemporary Bournemouth seaside bar and restaurant Urban Reef.’ It says ‘located next to the beach on Boscombe Promenade, Urban Reef opened in 2009 and is a stylish two-storey venue comprising a bar, café, deli and restaurant, boasting stunning panoramic views of Bournemouth Bay, from the Isle of Wight to the Purbecks and beyond. RedCat Pub Company has acquired The Meynell Ingram Arms and The Cock Inn Mugginton from Berkeley Inns Limited. Chipotle in the US has closed its first store in the country to unionise. The co says ‘despite the considerable time and resources we’ve spent trying to staff the restaurant, we don’t have management necessary to reopen and, combined with the ongoing callouts and lack of availability of existing staff, we won’t be able to open the restaurant for the foreseeable future.’ Risk reduction. Stonegate has told the MCA that its investments in the short term will focus on conversions. Fever-Tree has announced that NED Kevin Havelock has bought 30,816 ordinary shares in the Company at a volume weighted average price of GBP £8.90 per ordinary share. HOLIDAYS & LEISURE TRAVEL: Luton airport reopened yesterday after mending its melted runway. Train services to the airport remained subject to substantial disruption. Eurostar says it has seen a “robust return” of business travellers. It says 75% of the pre-pandemic timetable is now running and business travel is up to 70% of 2019 levels. OTHER LEISURE: Apple is planning to slow hiring and spending growth next year reports Bloomberg. Netflix yesterday reported better-than-expected Q2 earnings seeing a smaller fall in subscriptions than had been originally forecast. The Guardian reports that ‘Twitter has won the first legal skirmish in its attempt to force Elon Musk to complete a $44bn (£36.7bn) takeover of the social media company, after a judge ruled that a trial will take place in October.’ FINANCE & MARKETS: Inflation numbers from the ONS. See Pubs & Restaurants above. Commenting on the latest Labour Market statistics, the BCC says ‘the labour market remains incredibly tight, in many cases affecting firms’ ability to maintain normal operations.’ • See premium. Reply to this e/m to see a sample of the full email and / or to upgrade. Bank of England governor Andrew Bailey, who had earlier maintained that inflation was transient, seems to have changed his mind. He says that bigger interest rate hikes (i.e. larger than 0.25%) could be on the cards. He said that such a move is “not locked in.” Sterling mixed at $1.2031 and €1.1741. Oil higher at $106.76. UK 10yr gilt yield up 4bps at 2.20%. World markets better yesterday and London set to open around 39pts higher as at 6.30am. FORTHCOMING NEWS: Deliveroo and Tortilla update on trading on Monday and Loungers hosts investor presentations on Tuesday. Fuller’s hosts its AGM (and will update on trading) on Wednesday and Premier Foods also updates on Q1 on Wednesday and Fulham Shore reports full year numbers on Thursday. DPEU will update on H1 trading, also on Thursday. Big week for economic releases. We have Unemployment and Average Earnings numbers on Tuesday then Inflation numbers on Wednesday. Thursday sees the ONS admit to how much the government is Borrowing on behalf of taxpayers and on Friday we have a triple whammy of Retail Sales numbers, the GfK Consumer Confidence Index and Flash PMIs for July. RETAIL WITH NICK BUBB: • See premium. Reply to this e/m to see a sample of the full email and / or to upgrade. |
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