Langton Capital – 2023-01-23 – Fuller’s update, Everyman, delivery, the consumer, prices & other:
Fuller’s update, Everyman, delivery, the consumer, prices & other:A DAY IN THE LIFE: Whilst I don’t really give a monkey’s, it’s hard to feel flattered when the automatic air freshener in a shopping centre loo registers your presence by squirting scent into the air. I mean is it anticipatory or is it a comment on your current condition? Or is it simply motion sensitive or is it just on a timer? So many questions, the answer to any one of which could ruin the day for anyone with a nascent persecution complex. On to the news: LANGTON EMAIL: The Free Email is now written in short form. Extended versions of many stories (after the ellipses) 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 FULLER’S 43 WEEK UPDATE – CAUTIONS ON IMPACT OF STRIKES: Fuller’s has this morning updated on trading for the first 43wks of its current financial year and our comments thereon are set out below: Trading: Fuller’s reports ‘the underlying positive sales momentum of the business has continued with like for like sales for the 43 weeks to 21 January 2023 up 20% on last year, despite the challenging consumer backdrop.’ The company says ‘in comparison to pre-pandemic levels, our like for like sales for the 43 weeks are at 97% against the same period in FY 2020.’ It adds ‘sales… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. PUBS & RESTAURANTS: Delivery: The latest Hospitality at Home Tracker produced by CGA suggests that ‘managed restaurant groups’ delivery and takeaway sales ended 2022 at twice their pre-COVID level.’ It says ‘combined sales in December 2022 were 104% higher than in December 2019, with deliveries up 238% and takeaway and click-and-collect orders 53% ahead…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Discounting. Certain M&B Vintage Pub units are offering 50% off mains, Monday to Thursday, for the rest of this week. Cost of living crisis. Morrisons is reported to be cutting prices on hundreds more products. The Telegraph says ‘the grocer is this week pushing through price cuts on 820 products on its shelves, taking the total number of products that it has reduced prices on this month to more than 1,000.’ It says the average price reduction is 20%… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Business outlook: Christie & Co’s Business Outlook 2023 claims that demand for convenience, consistency and value since the pandemic has ‘fundamentally reshaped’ the restaurant industry. QSR restaurants are using franchised models and drive-thrus to achieve growth in a tough macroeconomic environment. Christie & Co reports that there was a 30% increase in transactional volumes of freehold restaurants, with prices achieved within 10% of the final asking price. Distressed transactions remain at low levels due to the fact that, with no value to be gained, many keys went back to landlords… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Bottle return scheme: UKHospitality CEO Kate Nicholls has responded to Defra’s Deposit Return Scheme plans by saying ‘As we have seen in Scotland, the introduction of a Deposit Return Scheme is a colossal and complex undertaking…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Inflation: John Allan, chairman of Tesco, has told the BBC’s Laura Kuenssberg programme that some food firms may be using inflation as an excuse to hike prices further than warranted. Tesco is trying “very hard” to challenge some price hikes… Other news: South Africa reports that its wine exports fell by 5% YoY in 2022, selling 20 million fewer litres of wine than in the previous year. However, the UK continued to be South Africa’s largest wine export market, and last year bucked the wider global trend by snapping up 8% more wine YoY from SA. COMPANY NEWS: Fitch Ratings last week affirmed its B- rating on the Stonegate Pub Company. It says it has a ‘negative outlook’. Fitch reports… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Junkyard Golf Club is reported to have invested £2.7m to open in London’s Camden this year. The FT reports that Hong Kong-based activist hedge fund Oasis Management has taken a 5% stake in The Restaurant Group. The stake may have been built up around November last year. The owner of KFC, Pizza Hut & Taco Bell, Yum! Brands, reports that it had to shut less than 300 of its UK restaurants following a ransomware attack earlier last week… MCA reports that Revolution Bars Group CEO Rob Pitcher is focusing on integrating Peach Pubs into the business. Pitcher also said ‘we continue to review potential new sites and when the time is right, we will look to significantly expand the business.’ Pizza East, owned by Soho House, has closed both of its restaurants, but claims the Shoreditch site is only temporarily closed. However, the group failed to offer any sort of timeframe as to when it expects the restaurant to reopen. Doner Shack is reported to have added two new franchisees to its system. BrewDog’s James Watt warns the price of a pint of Punk IPA would go to £27.50 if the company’s prices rose in line with its energy bills. The figures suggest that Watt has multiplied their current prices by the percentage increase of energy bills, which is perhaps not a worthwhile comparison. HOLIDAYS & LEISURE TRAVEL: The Mail reports that ‘On the Beach is heading for a showdown with investors over plans to drop performance targets for its long-term bonus scheme.’ The Lloyds Bank UK Sector Tracker reports that the UK’s tourism and recreation sector grew slightly in December, with a reading of 50.2, compared to 44.6 in November (anything below 50 marks a contraction). However, overall UK economic activity saw a slight decline, with a reading of 49, compared to 48.2 in November… The Sunday Times reports that ‘Saga is sounding out buyers for its in-house insurance business in the hope of raising up to £90 million to pay down debt at the over-50s travel and insurance group.’ It adds the CEO ‘is exploring the sale of the underwriting business as part of his strategy to take risk out of the troubled business and reduce its £721 million debt.’ Saga has responded to the coverage above saying that it ‘confirms that it is in discussions with regard to a possible disposal of this business.’ It says it ‘remains committed to providing a best-in-class insurance offer to its customers. The Board has looked at the opportunities to optimise Saga’s operational and strategic position in the insurance market, in line with the evolution to a capital-light business model and the stated objective to reduce debt. It has concluded that a potential disposal of its Underwriting business is consistent with Group strategy and would crystalise value and enhance long-term returns for shareholders. AICL currently underwrites approximately 25-30% of Saga’s insurance business.’ Saga adds ‘discussions are ongoing and there can be no certainty that any transaction will occur. Any disposal of AICL would require regulatory and shareholder approvals. A further announcement will be made in due course.’ OTHER LEISURE: Everyman Media Group has updated on trading for its year to 29 December, saying that group revenue will be £79.7m, up 62.5% versus the prior year (2021: £49.0m). The company adds group EBITDA should be ‘ahead of market expectations at approximately £14.5m, an increase of 74.7% vs. the prior year (2021: £8.3m).’ The company says it has maintained market share at 4.5% and says that two new venues were opened in the year, Edinburgh and Egham. The Group now operates 38 venues with a total of 130 screens (2021: 36 venues with a total of 119 screens)… • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Alphabet has announced that it will cut 6% of its global workforce, around 12,000 people. MGM Resorts is reported to be considering another takeover bid for Entain, owner of Ladbrokes, Coral and Gala Bingo. FINANCE & MARKETS: Employers’ organisation the CBI suggests that the Tory Party could take its eye off the ball if it descends into internal conflict over tax rises (or cuts). DG of the CBI Tony Danker says that it is the ‘wrong time for [a] Tory tax war’ and says ‘big economic decisions [are] needed now for the UK to catch up with rivals.’ The CBI says the ‘UK is getting less competitive: it has lost out on estimated £4.3bn of green growth market value in Europe alone and in April will fall from 5th to 30th place in OECD table on tax competitiveness overnight.’ It adds that the ‘PM is right to resist calls for mass tax cuts’ but says sustainable growth ‘depends on taking some very big decisions right now, not waiting until 2024…’ • See premium. Reply for sample or to upgrade. Single £345, multiple £595. Limited time offer: PayPal monthly £25 + VAT. Easy in, easy out. Bank of England governor Andrew Bailey suggested last week that, whilst he was ‘not endorsing 4.5%’ as where the current round of interest rate rises would top out, he added ‘you may have noticed in December is that we did not include the comment… about the market being… out of line.’ Sterling mixed at $1.2424 and €1.14. Oil price higher at $87.56. UK 10yr gilt yield up 3bps at 3.35%. World markets better on Friday & London set to open 12 pts higher as at 6.30am. 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. |
|
