Budget, Fuller’s H1 meeting, confidence, Parsleybox, Everyman etc.:

A DAY IN THE LIFE:

It’s the end of the week and it’s felt like a long one.

Most of them seem to be these days, of course, but, after a week of grim economic and so-so company news, it’s good to see GfK this morning saying that there has been a slight bounce in consumer confidence in November.

True, its number has only ‘risen’ three points to minus 44 from minus 47 (think of drowning in 44 feet of water as being slightly ‘better’ than drowning in 47 feet), but at least it’s a move in the right direction.

However, if that’s the way you want to interpret it, it’s best not to read the blurb that accompanies the release. But it’s Friday, it isn’t raining and we’ll let that slip.

Have a good weekend and let’s move on to the news:

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THE CHANCELLOR’S AUTUMN STATEMENT:

Summary:

• Trying hard not to overdose on this. Mr Hunt said there would be no surprises and, indeed, there are not.

• The chancellor says we are in recession, it will be tough, he will freeze income tax bands until 2028 (stealth tax) and cut allowances for capital gains & dividend receipts.

• He will clobber the energy companies. And the oil companies and cut the salary level at which income tax is paid from £150k to around £125k.

• On the positive side, at least for workers if not for their employers, the National Living Wage will rise from £9.50 to £10.40. Pensioners will benefit relative to other consumers in that the triple lock is to be maintained.

This can be viewed in two ways:

• Business. Some comments from business organisations are included below.

• The consumer. Here, pensioners and those on lower wages have been ‘protected’, albeit at a cost to business for the latter via increases in the NLW.

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FULLER’S H1 NUMBERS:

Fuller’s (FSTA) yesterday held its H1 analysts’ meeting and our comments thereon are set out below:

The numbers:

• Fuller’s reports that sales in the first 26wks of the year rose from £116.3m in the Covid-impacted last year to £168.9m (+45%)

• EBITDA is up from £22.8m to £28.9m (better trading but less help from government & higher VAT) and adjusted PBT is more than doubled from £4.6m to £9.8m

• FSTA says that LfL sales in H1 were up by 20%

o Central London (which has been slower to recover and which has suffered from rail strikes and the like) up as much as 67%

o Sites not in central London but within the M25 had LfL sales up 38%

o Sites outside the M25 had LfLs that were broadly flat

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PUBS & RESTAURANTS:

The consumer:

GfK comments on November UK consumer confidence saying its number, at minus 44, is up 3pts on the October measure, but it remains near all-time lows. GfK says ‘despite the three-point rise in confidence to minus 44 this month, and improvements in all measures registering the financial and economic mood of the nation, November’s Overall Index Score remains at a near historic low.’ It adds ‘this month’s fillip is likely to reflect nothing more than a collective sigh of relief as a new prime minister takes charge following the alarming fiscal antics we saw in September…’

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The Office for Budget Responsibility has warned the disposable incomes of UK households would fall by 7.1% over the next two years – the lowest level since records began in 1956/7, and taking incomes down to 2013 levels. The Resolution Foundation and the Institute for Fiscal Studies will provide their own analysis of the plans later this morning.

The Autumn Statement and the consumer. The triple lock is maintained and help with fuel bills will be extended. But Government stats suggest that real incomes could fall by 7% in the next 2-3 years. Living standards may not recover to the levels they were last year, when they briefly blipped above pre-Covid levels, for six years. The ONS suggests that real incomes will still not have recovered to pre-Brexit referendum levels by 2027…

Other news:

The Mayor of London, Sadiq Khan, has announced new Night Time Enterprise Zones in Bromley town centre, Vauxhall and Woolwich. The £500,000 programme will help boost the selected high streets after 6pm with innovative events and business support to drive the economic recovery.

Other news:

Research from GoDaddy shows that 52% of consumers are turning to second-hand shopping to reduce expenditures during the cost-of-living crisis, with 62% saying they’re more likely to ‘upcycle’ clothes and furniture to conserve cash.

The New York City Department of Consumer and Worker Protection has issued a report outlining suggested minimum wage levels for food delivery workers in New York City. It is calling for a $17.87 hourly wage rate for workers from the beginning of next year.

Black Box Intelligence suggests that there has been a strong rebound in restaurant sales in the US between August and October. It says October’s same-store sales growth of +5.2% year-over-year matched September’s…

Remit Consulting has suggested that the major ‘return to work’ has taken place and it suggests that UK offices may not now get much fuller than they are already. It says the number returning seems to ‘have plateaued’ in the last couple of months. Remit Consulting, tracks card key fob usage.

COMPANY NEWS:

Parsley Box Group, the direct to consumer provider of ready meals and other products focused on the 65+ demographic, has announced that it intends to de-list from AIM. It says this will be followed by the re-registration of the Company as a private limited company. The company only listed its shares last year. They traded briefly above 200p but they are currently 1.65p.

Unionized Starbucks workers in the US are set to strike in 100 stores on what they are calling “Red Cup Rebellion Day.”

Asahi will close Dark Star Brewery at its Partridge Green site due to the brewery operating ‘significantly below capacity’.

Nightcap CEO Sarah Willingham claims that the company will not miss out on property opportunities despite pausing the company’s roll-out.  Willingham said ‘I think there is going to be more property available at better prices, more incentives, in three to six months’ time than there are today.’

The Alchemist is set to open a site in Berlin, Germany, located in Potsdamer Platz and set to open in Spring 2023.

Northern England-based The Coffee House plans to double its estate to 25 sites by 2025. The independent speciality coffee shop operator has just opened its 12th site, in Bolton.

HOLIDAYS & LEISURE TRAVEL:

Jet2.com and Jet2holidays CEO Steve Heapy has warned agents not to gamble on having a strong January as the industry continues to face uncertainty, saying it would be ‘foolish’ to assume January 2023 will be typical. Heapy cited the war in Ukraine, the cost-of-living crisis and the explosion in Poland as reasons for global uncertainty.

STR reports that London daily room rates rose to £199.95 last month, compared to £162.07 in October 2019. REVPAR was up some 18% on 2019 at £167.60. STR says ‘when looking at daily data, the market continued to show high occupancy levels on Tuesdays and Wednesdays, pointing to business demand, with the highest daily occupancy for the month – 93 per cent – recorded on Wednesday, 12 October.’

Jet2’s Steve Heapy also claimed the travel industry is in for a ‘rough ride’ over the next 12 months due to increased interest rates leaving people with less disposable income to spend on holidays. Heapy said ‘I don’t agree with the action the Bank of England are taking, I think it’s the wrong thing putting interest rates up as it will push the country into a recession’.

Heapy also declared the company will never open its own travel agency, instead saying the firm will ‘concentrate on what we’re good at…We will never open our own travel agency.’

OTHER LEISURE:

Everyman Media Group has announced that Executive Chairman Paul Wise ‘has decided to step down from the Board to pursue other interests.’ It says ‘Paul will remain in his role until 28 February 2023, at which point Philip Jacobson, currently a Non-Executive Director of the Company, will assume the role of Non-Executive Chairman.’ CEO Alex Scrimgeour says ‘on behalf of the Board and everyone at Everyman I would like to thank Paul for his contribution during his tenure.’

Twitter has reportedly told employees that the company’s office buildings will be temporarily closed from today and will reopen on Monday 21 November. A message to staff says ‘please continue to comply with company policy by refraining from discussing confidential company information on social media, with the press or elsewhere.’

YESTERDAY’S TWEETS:

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FINANCE & MARKETS:

Bank of England governor Andrew Bailey has said that a shrinking labour force could keep interest rates high. He says ‘the UK is the only OECD country showing this pattern of labour force shock.’

MPC member Catherine Mann has said that Britain is a “dramatic outlier” when it comes to labour market shortfalls. She says ‘higher wages…would tend to bring people back into work.’

The governor of the Bank of England says that factors including Brexit had led to a slowdown in the UK economy. MPC member Swati Dhingra cited a study by the London School of Economics suggesting that a “Brexit effect” was responsible for around 6pps on the price of food.

Sterling very little changed at $1.1897 and €1,1473. Oil down at $90.23. UK 10yr gilt yield up 4bps at 3.19%. World markets broadly lower yesterday. London set to open up around 7pts 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

https://www.eventbrite.co.uk/e/the-vsa-capital-aquis-showcase-event-tickets-430890363677?aff=odeimcmailchimp&mc_eid=cfe56acbe0&mc_cid=cd83de005f

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:

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