Langton Capital – 2023-03-08 – Restaurant Group, MARS, FBG, Hotel Chocolat, rail strikes & other:
Restaurant Group, MARS, FBG, Hotel Chocolat, rail strikes & other:A DAY IN THE LIFE: Bit busy today. 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 are £395 for one subscription, £695 for multiple, £995 for very large subscribers, all plus VAT. Or sign up for easy in, easy out monthly option per subscriber HERE https://www.paypal.com/cgi-bin/webscr?cmd=_s-xclick&hosted_button_id=87YUG2Z5W7PSN RESTAURANT GROUP – FULL YEAR NUMBERS: The Restaurant Group has this morning released FY numbers and our comments thereon are set out below: The numbers: RTN reports total sales of £883.0m (up from £636.6m) with adjusted EBITDA (pre-IFRS16) of £83.0m (vs £81.2m). The company says PBT was £20.3m against a profit of £16.6m last year (both pre-IFRS16). There are additionally exceptional charges of £117.5m. The company says ‘these costs in the main relate to the reduced forecast earnings within our Leisure division and the subsequent planned restructuring.’ Net debt pre-IFRS16 is £185.7m against £171.6m in the prior year. Debt is 2.2x EBITDA against 2.1x last year. Diluted EPS pre-exceptional costs is 3.3p and there is no dividend in either financial year. The group has prepared accounts on a going concern basis. It reports ‘the Board has a reasonable expectation that the Group, and Company, have adequate resources to continue in operational existence for the period to 31 March 2024. On this basis, the Directors continue to adopt the going concern basis of preparation. • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. PUBS & RESTAURANTS: Rail strikes: The RMT union has called off the strike action at Network Rail planned for next week on 16 March (and potentially thereafter), after the employer made a revised pay offer. If this leads to a settlement, it would be very positive for hospitality business, particularly in London. The BBC says the development was a ‘surprise’. Sky says it ‘understands there is to be a referendum of members on the latest Network Rail offer…’ • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Hotel Chocolat has reported H1 numbers to 25 December saying that revenue was £129.8m vs £142.9m and underlying PBT was £10.2m against £25.4m last year. EPS is 4.5p against 12.0p and the H1 dividend is zero in both years… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Pre-Budget lobbying: Some 155 hospitality businesses come together to sign an open letter to Chancellor Jeremy Hunt calling on him to help the sector in his upcoming Budget. UKH co-ordinated the letter which warns that inflation along with debt pressures are holding the sector back… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Optimising trading: KAM has been looking at midweek trading and suggests that sports can be used to drive trade… Geography. The State of the North study from CGA suggests that northern cities such as York and Newcastle are recovering sales more rapidly than some other locations… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. The consumer: Foxton’s CEO Guy Gittins has said that the lack of rental options in London means that younger people may have to move further out. Rents have risen and there is said to be a mismatch between supply and demand… REVOLUTION BARS: Revolution Bars Group yesterday morning held its H1 analyst meeting and our comments are set out below: Headline numbers & points: RBG reports total sales in the 6mths of £76.0m against £74.1m in the same period last year. Operating profit is £3.1m (2022: £6.7m) and adjusted EBITDA is £9.8m against £12.2m. • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. COMPANY NEWS: Marston’s is reported to have placed some 61 pubs on the market. Propel reports that the assets, which are a selection of Marston’s non-core properties, include a mix of leased, tenanted, retail and managed pubs and are available to purchase individually, in small groups or as a group package… Arc Inspirations has opened its first site of 2023. The opening, in Sheffield, will be ‘followed by multi-million pound venue launches in Birmingham, Newcastle and Nottingham.’ Arc says Christmas trade was strong with LfL sales for the six weeks to the end of 2022 across Manahatta, BOX and Banyan up by 3.2% on 2021, and 25.5% on 2020… Big Mamma is to open its latest unit, in Marylebone, in May. Restaurant Group. The FT yesterday reported that activist shareholder Oasis Management had threatened to push for the removal of Andy Hornby as The Restaurant Group’s CEO unless he puts the company into a ‘virtuous circle’ whereby it can ‘reduce debt, reduce interest, resume dividends . . . get a higher stock rating, better market cap [and] attract better people’. Hello Fresh disappointed analysts yesterday when it missed expectations. The company says it now expects 2023 revenue to rise 2%-10% on constant currency and sees ‘relatively muted’ order growth in 2023… Gregg’s. Numbers yesterday saw the shares slip 2% to £26.90. The Press focuses on plans to open 150 stores this year, to aim for perhaps 3,000 (and possibly more further down the line) and to test drive thru demand. Salcombe Brewery Co. has announced that it has ‘secured an agreement with John Lewis to sell an exclusive gift pack of their beer online and in John Lewis stores nationwide’. HOLIDAYS & LEISURE TRAVEL: The government has warned that strike action by the Public and Commercial Services union has could delay arrivals in the UK on 15 March. TUI has added 1,500 hotels across 22 destinations for summer 2024 as a result of the current rebound in holiday bookings from the UK. The Telegraph has reported that, post Brexit, ‘British travellers face another 18 months of queues for visa stamps at EU borders.’ The Business Travel Association has reported that 95% of UK firms believe that resuming business travel is important to their business. The BTA says ‘our report unequivocally shows that business travel is so much more than suited executives turning left on a plane. It impacts the entire business network across the UK and worldwide.’ Nationwide strikes in France have adversely impacted travel. REVPAR is not the be-all and end-all. HVS reports that ‘hotel operators need to learn to manage the entire building they operate and start thinking of performance in terms of the total revenue or profit per available square metre, giving a more accurate assessment of the property’s success…’ • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. OTHER LEISURE: Sky reports that ‘the founder of Picturehouse, the boutique cinema chain, is hatching a plan to buy it back as part of a potential break-up of Cineworld, the stricken London-listed group…’ FINANCE & MARKETS: The Halifax Building Society yesterday reported that UK house prices rose by 1.1% in February to leave the annual rate of increase at 2.1% for the third month running. Prices rose by 0.2% in January and fell by 1.3% in December… • See premium. Reply for sample or to upgrade. Single £395, multiple £695. Limited time offer: PayPal alternative monthly £25 + VAT per sub. Easy in, easy out. Federal Reserve boss Jerome Powell has indicated that the US central bank may have to raise interest rates farther and faster than previously indicated… Sterling weaker at $1.1821 and €1.122. Oil lower at $83.35. UK 10yr gilt yield down 4bps at 3.82%. World markets broadly lower yesterday and London set to open down around 16pts. RETAIL WITH NICK BUBB: • See premium. 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