Punch, Soho House, BrewDog, trading, food supply, city breaks & other:

A DAY IN THE LIFE:

Well that was a pretty pleasant weekend.

Dry and sunny, which makes a change to be sure, and the Northern Lights giving us a show across much of the country although, I must admit, some of the bits that I dragged myself away from Eurovision to goggle at resembled streaky clouds rather than anything more dramatic.

And, speaking of Eurovision, whilst I have to register a protest in principle against the show, I regularly find myself foot-tapping and humming, swept along by the baffling enthusiasm of all concerned, in equal measures horrified and entertained.

Indeed, horrified at the thought of being entertained, left scrabbling for a Radiohead album or the like but it is what it is and at least we didn’t come last.

Anyway, I got a bit of the grass cut, too. A small triangle alongside the drive, perhaps 5% of the whole garden but at least it’s a start. But it’s another one of those pesky, five-day weeks so, without further ado, let’s move on to the news:

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PUBS & RESTAURANTS:

Labour costs:

Upward pressure on wages, driven by the NLW and competitor action (in the widest sense of the word). Labour costs are on the increase as discount supermarket chain Lidl has increased its basic wages to £12.40 per hour for workers outside greater London and £13.65 within the M25 motorway, aligning them with Aldi’s rates.

Trading:

CGA has updated on on-trade drink saying that ‘on Premise drinks sales have fallen year-on-year for the fifth week in a row’ but it adds that ‘there are welcome signs that May will be a brighter month for operators and suppliers.’ CGA reports that sales to 4 May were 4% behind last year before taking into account the impact of inflation…

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Food supply issues:

The Agriculture and Horticulture Development Board (AHDB) and the Soil Association have expressed concerns over the financial and mental toll on farm owners from the recent prolonged wet weather. The AHDB highlighted the urgent need to address the sector’s challenges to ensure food security….

Other news:

UK beer sales, including both craft and non-craft categories, showed positive growth in 2023, with craft beer seeing its three-year CAGR increase from minus 10.2% in 2022 to 2.7% in 2023. With the market showing signs of recovery, analysts suggest that this could be an opportune moment for UK craft brewers like BrewDog to consider an IPO….

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The Sunday Times has published its list of Best Places to Work 2024. Amongst F&B operators, it names Moto, Dishoom, Wagamama and Drake and Morgan amongst others including Hall & Woodhouse, Red Engine, Bella Italia and Las Iguanas.

COMPANY NEWS:

Punch Pubs reported Q2 revenue up 4.4% YoY to £165.1m with underlying EBITDA up 12% to £58.6m. For  the 28 weeks ended 25 February 2024, all three divisions of the pub company – Leased and Tenanted, Management Partnership and Laine – delivered LfL sales growth. Capital expenditure focused on expansion and maintenance, with investments in energy efficiency also being prioritised….

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Q1 results from Soho House reported on Friday afternoon. In Q1 2024, Soho House & Co Inc. saw a 9.9% YoY increase in total members, reaching 261,571, with membership revenues rising by 20.4%. Despite a slight decline in in-house revenues, down 5% to $110.4m, the company remains confident in its performance and is set to open Soho House Sao Paulo soon. Adjusted EBITDA was $19.3m, down $(0.8)m from first quarter 2023….

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Per Restaurant Online, The Rum Kitchen, a Caribbean-themed bar and restaurant brand with locations in London and Brighton, has closed its entire estate without making an official announcement. All locations have ceased operations within the last month, with one trading subsidiary being wound up in April.

Commenting on the resignation of James Watt as CEO of BrewDog, The Sunday Times quotes the former business leader as saying that a stock market flotation is ‘not on the immediate horizon’ and his decision is ‘independent’ of that possibility. He says ‘there’s absolutely no link or correlation…’

The MCA reports after a conversation with CEO Roy Ellis that Mission Mars plans to expand its Albert’s Schenke concept across the UK, aiming for 50-60 sites due to its smaller scale compared to Albert’s Schloss….

JD Wetherspoon will continue selling stronger Carlsberg in its pubs, defying the brewer’s plan to reduce the alcohol content in response to tax changes. This decision follows criticism from Wetherspoon’s chairman, Sir Tim Martin, who had previously expressed concerns about brewers diluting their beers.

PizzaExpress will debut its inaugural UK airport restaurant at London’s Gatwick on 20 May, featuring breakfast offerings available from 3:30am to 11am.

HOLIDAYS, HOTELS & LEISURE TRAVEL:

A survey conducted by Post Office Travel Money has found that prices are down in as many as 60% of popular city break destinations, at least when denominated in Sterling (which has been relatively strong…)

Manchester airport has reported that some 2.4m passengers passed through it in April, up from 2.2m last year and some 25,000 more than the previous high recorded pre-pandemic, in 2019…

Sky News reports that Pinewood Studios shareholder Aermont is among the suitors vying to buy Village Hotels, one of Britain’s biggest mid-market hotel chains. It suggests that PE house Blackstone is considering making an offer but has yet to do so.

IAG observed a 4.4% increase YoY in Q1 passenger revenue per available seat kilometre (ASK), driven by the timing of Easter and a robust recovery in leisure travel, although business travel rebounded more gradually. Capacity growth to Europe increased by 9.0%, leading to a 5.7% growth in unit revenue, fueled by strong demand for leisure travel.

Inbound travel into the US. Tourism leaders at IPW highlighted several challenges hindering the US tourism industry’s performance despite being on track to reach its target of 90 million visitors and spending of $279bn by 2027….

OTHER LEISURE:

Newbury Racecourse plc reported full year numbers on Friday saying that revenue had risen by 9% to £18.96m. It said that PBT was £0.72m (2022: £0.13m), though the number did include an exceptional profit of £0.7m being the release of a provision in connection with an obligation relating to the sale and redevelopment of the racecourse….

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FINANCE & MARKETS:

The BBC reports that recent ONS growth numbers, if sustained, ‘show an economy returning to a normal rate of growth. The UK is now growing joint fastest in the G7, equal with Canada and outpacing France, Germany, Italy, Japan and the United States….’

CBRE updates on its view for the UK economy saying that ‘the headline inflation rate will continue down towards the Bank’s 2% target rate. However, the trajectory will not be smooth’. It says ‘while it will likely first reach 2% in the summer, it may oscillate around this level for the remainder of the year before stabilising at the target in early 2025…’

Sterling up at $1.2525 and €1.1632. Oil lower at $82.54. UK 10 year gilt yield up 2bps at 4.17%. World markets broadly better on Friday but London set to open down a modest 14 points or so as at 6.30am.

RETAIL WITH NICK BUBB:

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