Langton Capital – 2022-11-04 – Mortgages, service sector, SBUX, FUL, Arc, Shake Shack, Marriott etc.:
Mortgages, service sector, SBUX, FUL, Arc, Shake Shack, Marriott etc.:A DAY IN THE LIFE: Frost on the grass this morning but it wasn’t like that overnight. Indeed, I can’t remember where we are with the drought but what I do know is that rain nearly punched a bunch of holes in our roof yesterday evening. And the wind brought most of the last of the apples down but, returning to precipitation, the grass is sodden, the pond that is meant to be a pond is overflowing and we have become reacquainted with the several seasonal ponds that appear wherever the ground sags. As, once again, the Vale of York has quickly proved beyond reasonable doubt both that water will quickly find the lowest point in any environment and, in this case, that means it tootles quickly down from the Dales and the Moors in order to make an impassable quagmire out of my back garden. Anyway, it really is nearly the weekend so, without further ado, let’s move 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 https://www.paypal.com/cgi-bin/webscr?cmd=_s-xclick&hosted_button_id=87YUG2Z5W7PSN PUBS & RESTAURANTS: Service sector activity: S&P has reported its UK Services PMI number for October saying that output declined in the month. The reading was 48.8 against 50.0 in September. This is the lowest reading since January last year. S&P says that ‘survey respondents often commented on shrinking demand and greater risk aversion among clients, largely due to heightened political and economic uncertainty….’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Disposable income: The RAC reports that consumers faced a ‘severe shock’ after the price of diesel shot up in October after Opec+ decided to cut production. The price of diesel rose by 10p a litre to 190.5p on average, meaning that the cost of a full tank of diesel, often seen as a necessity, rose by more than £5 to £105… Interest rates: The British Beer & Pub Association has responded to the Bank of England’s interest rate hike yesterday saying ’the last thing pubs and brewers want to do is put prices up for loyal customers but are stuck between a rock and hard place.’ Other news: The Night-Time Industries Association has said that the Government is “ripping the heart out of nightlife” as the sector awaits the upcoming budget that has already “failed them twice before.” The NTIA sources CGA data to suggest that some 123 nightclubs have closed in the year to end-September. COMPANY NEWS: Starbucks yesterday reported Q4 and full year 2022 numbers to 2 October saying that Q4 revenues rose by 3% with same store sales up 7%. There was an 8% increase in ‘average ticket’ suggesting that the stores saw a small volume decline. The sales were up by 11% in the US. Results elsewhere will have been impacted by a strong US dollar on conversion. Starbucks says that ‘international comparable store sales decreased 5%, driven by a 5% decline in comparable transactions and a 1% decline in average ticket; China comparable store sales decreased 16%, driven by a 17% decline in comparable transactions, partially offset by a 1% increase in average ticket…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Fulham Shore chairman David Page tells the MCA that the group’s move to sell pizzas through supermarkets will not cannibalise restaurant sales. He says a similar move by Pizza Express some 20yrs ago had ‘no effect on the restaurant’ and ‘made a lot of money for no capital expenditure.’ He says the decision whether to eat at home or to eat out are completely different. • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Sainsbury says it is raising prices at a slower pace than its rivals. Arc Inspirations, operator of Banyan, BOX and Manahatta, has appointed Mike Tye as Chairman… WSH Group has acquired 11-strong London-based boutique café chain Notes for an undisclosed sum… Just Eat has launched a new partnership with Five Guys, offering nationwide delivery from almost all of its restaurant sites across the UK… Shake Shack has reported Q3 revenue up 17.5% YoY to $227.8m, including $219.5m of Shack sales and $8.3m of Licensing revenue. System-wide sales were $353.2m, up 18.3% versus 2021, with an operating loss of $4.8m. The company opened 2 new domestic Company-operated Shacks. Opened 6 new licensed Shacks, including locations in China and Korea. Caffè Nero has launched its brand-new Christmas range featuring the Vegan Festive Feast, Cinnamon Swirl Latte and Chocolate Hazelnut Chouxnut among others. In addition to being listed in New Zealand, Cooks Coffee Company announces that it has ‘completed its dual listing on the Access Segment of the Aquis Stock Exchange’. The company says its ‘Esquires and Triple Two brands [in the UK] continue to perform well…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Iconic City chophouse Simpson’s Tavern is reported to have launched a crowdfund campaign as it seeks funds to ensure its survival. City AM reports that the company was served with a winding-up petition by its landlord last week. Diageo has announced that it has bought super-premium, Texas-based whiskey producer Balcones Distilling for an undisclosed sum. HOLIDAYS & LEISURE TRAVEL: Accountant PwC has forecast that average hotel rates in London could reach up to £212.60 in 2023, up around 18 per cent on last year (2021)’s rates… Meanwhile STR reports that US hotel performance slipped a little in the week to 29 October but it does say that occupancy was 65.8%, some 5.2pps higher than the pre-Covid year of 2019. Somewhat spoiling the party, it adds ‘the occupancy increase from 2019 reflected the positive side of the Halloween calendar shift, as the holiday fell during the comparable week in 2019.’ A Transport & Environment survey has concluded that 74% of employees believe travel policies should be set to combat climate change with 62% of frequent fliers saying that they have cut back on flights. Transport & Environment says ‘corporate flying habits have changed and employees want a new normal where businesses take responsibility for reducing their share of emissions.’ Sabre has reported Q3 numbers with net air bookings near 60% of 2019 levels by the end of the period. Bookings were only at 50% at the start of the quarter. Travel Weekly reports that travel agents saw another robust week last week, with notably strong long-haul, luxury and cruise sales, despite an increasingly gloomy macroeconomic picture… Homeworking agency Not Just Travel is claiming a record October… Royal Caribbean reports Q3 revenue of $3bn, with net income of $33m and adjusted EBITDA $742.3m. Booking volumes in Q3 accelerated versus Q2 of 2022 and remained significantly higher than booking volumes received in Q3 of 2019 for all future sailings…. Marriott International reports Q3 ‘comparable systemwide constant dollar RevPAR’ up 36.3% worldwide compared to 2021, and up 1.8% worldwide against 2019 comparatives. Q3 net income was $630m, up from $220m in the same period last year. The company added roughly 14,000 rooms globally in Q3, including approximately 8,700 rooms in international markets and nearly 3,900 conversion rooms… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Brittany Ferries reports a slump in traffic carried on the English Channel in the year to October as post-Brexit bureaucracy hit travel flows… OTHER LEISURE: Twitter is likely to inform some staff today about layoffs. The company says in an email ‘we will go through the difficult process of reducing our global workforce on Friday.’ It adds ‘we recognise this will impact a number of individuals who have made valuable contributions to Twitter, but this action is unfortunately necessary to ensure the company’s success moving forward.’ Changpeng Zhao, CEO & founder of Binance and a leading Twitter investor, has backed Elon Musk’s plans to axe half of the Twitter workforce. Zhao said ‘a slimmer workforce would make more sense’ with Musk reportedly planning to cut about 3,800 jobs. FINANCE & MARKETS: Interest rates: The Bank of England’s Monetary Policy Committee has voted 7-2 to raise the Bank Base Rate by 75bps to 3.00%. One of the dissenting members wanted to raise rates by 50bps and the other by 25bps. Rates may peak around 4.5%, somewhat lower than the 6.0% expected a month ago (the latter on the basis that the disastrous Truss mini-Budget would not be U-turned and the upcoming recession would be milder). • Recession, Inflation, Labour, See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Trade body comment: The CBI says this is a ‘bumper rate rise’ and says that ‘fiscal sustainability and lifting trend growth are both priorities.’ The BCC says the rate rise is ‘a very blunt instrument to control inflation that is largely the result of global factors, including soaring energy costs and supply chain disruption.’ Sterling weaker at $1.122 and €1.1468. Oil higher at $96.66. UK 10yr gilt yield up 11bps at 3.50%. World markets generally weaker yesterday but London set to open up around 45pts as at 6.30am. THE AQUIS MARKET: Broker VSA Capital is hosting an Aquis Day on Tues 29 November at the Royal College of Surgeons (38-43 Lincoln’s Inn Fields, London, WC1A 3PE). The event will feature around 20 companies, who will present to attendants and take part in a competition to win the ‘Britain’s Got Aquis’ title. Judges on the day will include Andy Brough (Schroders) and Judith Mackenzie of Downing LLP. Tickets and details are available HERE Attendance costs £20 – but Langton has a number of complimentary tickets and we’re open to suggestions as to who we should give them to…. Drop us a line. RETAIL WITH NICK BUBB: • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. |
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