Saga, BOWL, JDW, Rank, delivery, the High Street & other:

A DAY IN THE LIFE:

I was persuaded to drive a chunk of the family up to the Gateshead Metro Centre last weekend so that, at least on my part, I would never, ever, ever have to go there again.

Having said that, it wasn’t too bad and Newcastle, blessedly, were playing away.

The centre is huge, of course and, as my interests, such that they are in shopping centres, are more around the F&B offer, I spent a bit of time mooching around the ‘Town Square’ and the various casual dining brands, coffee shops and the like that infest the place.

Although it’s easier to see which brands are there rather than visualise those that are not, most players seem to have a presence.

Right from BK through to Wagamama, Wingstop, Yo Sushi and Zizzi, the alphabet was covered and noteworthy, perhaps was the relatively muted presence of burgers and pizza and the growth of chicken, kebab & noodle offers.

Anyway, not sure I want to go to Meadowhall or The Trafford Centre any time soon but, occasionally, these things need to be done.

On to the news:

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PUBS & RESTAURANTS:

Delivery & takeaway:

CGA’s latest Home Tracker, which monitors restaurants’ sales for consumption at-home, i.e. takeaway & delivery sales, suggests that sales flattened in December as consumers made the decision to go out to celebrate. The Tracker points to year on year growth of only 1.9%, below the rate of inflation, in December this year compared to the same month last year…

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The High Street:

Lloyds Banking Group, which operates the Lloyds and Bank of Scotland banking brands as well as owning the Halifax Building Society, has said it is to close a further 136 branches. The lender will shut 61 Lloyds, 61 Halifax and 14 Bank of Scotland sites between May this year and March 2026. Depending on what happens to the sites, this could depress footfall in some areas…

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Food prices:

Morrison’s has become one of the latest retailers to report that the upcoming increases in National Insurance Contributions will oblige it to put prices up. The company says it will attempt to keep prices low for shoppers, despite the ‘significant costs coming at us’. In addition, ASDA has said that it will be dropping its Aldi and Lidl price-match scheme having only introduced it a year ago…

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Other consumer costs:

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Growth plans:

UKH is calling on the government to ensure that hospitality is included withing its plans for growing the UK economy. CEO Kate Nicholls says ‘driving economic growth is rightly the Government’s top priority, but we need to see a plan for growth that reaches the whole economy.’ She says ‘big infrastructure projects are much-needed but the benefits won’t be realised for years’ and adds that ‘hospitality was the biggest driver of economic growth in November, demonstrating that we are already on the strongest growth path, despite the intense cost pressures our businesses face….’

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Late night:

Michael Kill, CEO of the NTIA, has said that the chancellor needs to introduce long term support for operators or risk the ‘collapse of the hospitality sector’. Mr Kill says ‘the rhetoric from the Chancellor may focus on cost-saving measures, but this is meaningless for businesses already buckling under the strain of rising costs and taxation, who have already cost-saved to extremes….’

Covid loans:

This is getting real. Handouts were loans rather than gifts and repayment could cause cash flow difficulties for some operators. In addition, the government is advertising actions it has taken against a number of directors for misrepresentation in the process of taking out the loans in the first place…

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Other news:

Jobs market: Tesco is to cut c400 jobs in ongoing moves to ‘simplify’ its business. Morrison’s is reported to be cutting 200 jobs.

COMPANY NEWS:

JD Wetherspoons is reported to have raised the price of a host of popular drinks and menu items in pubs from yesterday. The Sun reports it means the price of drinks have gone up by 15p and meal deals by 30p. The rise will take the cost of a Guinness at The London and South Western branch in South-West London move from £4.66 to £4.81, while the cost of a Strongbow will increase from £3.24 to £3.39, reports the ‘paper.

Vianet has updated on trading for the nine months to end-December saying that ‘during the period, the Group displayed a strong performance, achieving consistent margins and increased recurring revenue growth by securing valuable long-term contracts.’ However, the company says ‘it has become increasingly evident that the general economic uncertainty and shifts in the economic landscape have impacted several contracts during the conversion phase. This has resulted in a different mix of orders and products and some delays in contract completions and pipeline conversion….’

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Lidl has been given approval in the High Court to open a pub in its store in Dundonald, near Belfast.

The CMA is to investigate the proposed acquisition of The Famous Grouse by William Grant & Sons. The deal, which was announced in September 2024, has triggered an investigation with the CMA inviting submissions up to 12 February.

Sacha Lord has resigned as nighttime advisor to Greater Manchester council. A grant of £400,000 given to an events company co-owned Mr Lord has been reportedly pulled following a review. Mr Lord says the funds were used in the way intended, but there had been “a small number of unintended oversights”.

Rémy Cointreau yesterday updated on revenues for calendar 2024 saying that the drop in revenues it has been projecting will be at the lower end of expectations (of around 18%).

McMullen’s has concluded a third freehold purchase from pub company Oakman Inns. McMullen says ‘we are delighted to acquire the Anchor, the third of the pubs that Oakman have entrusted us with. The process has been well supported by the Oakman team, making it as smooth as possible for the team and guests. In addition to this, we expect to end our first month of 2025 by acquiring a separate London freehold….’

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Butcombe Group has updated on trading saying that it has seen ‘continued strong group performance, with sector leading Full Year LFL’s at 7.8% growth, including 23% LFL across the two week Christmas period.’ The group says that London contributed strongly to H2 trading at +27%….

Crêpeaffaire has reportedly been acquired out of administration by directors Daniel Spinath and Allen Kerslake for a total consideration of £149,000. Restaurant Online reports that ‘the pair acquired it under two new vehicles, Crepe Union and Crepe Trading, with seven UK sites remaining open as part of the deal.’

US restaurant chain Brinker International has reported Q4 LFL sales at Chili’s Grill & Bar up 31.4% on the same quarter last year.

SAGA GROUP FY UPDATE

Saga has this morning updated on trading for the period 1 August 2024 to 29 January 2025 and for the full year and our comments thereon are set out below:

Headline numbers: Saga reports that it ‘expects to report an Underlying Profit Before Tax that is marginally higher than the prior year, on a like-for-like basis, and ahead of our previous guidance.’ It says ‘Ocean Cruise has had another excellent year and, building on the momentum of 2023/24, delivered a load factor of 91%, 3ppts ahead of the 88% achieved in the prior year, and a per diem of £358, 8% ahead.’

The company says that ‘River Cruise Underlying Profit Before Tax continued to grow, supported by a load factor of 89% and per diem of £327, 4ppts and 15% higher than the prior year.’ Overall, ‘travel is expected to report an Underlying Profit Before Tax in the high single-digit millions, compared with £1.5m in the prior year, reflecting revenue growth of around 15% and passenger growth of 9% on a comparable basis.’ The insurance side of the business has continued in line with guidance. The company reports that ‘underlying Profit Before Tax will be materially lower than in 2023/24, with both the number of policies in force and policy sales across all products around 15% lower.’

Outlook:

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HOLIDAYS & LEISURE TRAVEL:

Chancellor Rachel Reeves has announced that the government is to back a third runway at Heathrow in order to ‘kickstart economic growth.’ The government reports that the ‘plan could create over 100,000 direct jobs….’

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The Aito Travel Insights 2025 report finds that 27.5% of respondents said they would take more holidays this year than they did last while 60.7% said they would take the same amount. Around 11.8% said they would take fewer holidays.

OTHER LEISURE:

The Hollywood Bowl Group has updated on Q1 trading ahead of its AGM later today saying that ‘trading over the period has been strong, including a record revenue month in both the UK and Canada in December. Total revenue growth over the period was up 11.3% and in line with Board expectations.’ The company adds that total UK revenue was up 8.0% with LFL revenues up 4.5% over the period. Total Canada revenue (on a constant currency basis) was up 40.8% (LFL revenues up 14.2% over the period)…

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The Rank Group has reported H1 numbers to end-December this morning saying that underlying net gaming revenue rose by 13% to £401.8m with underlying operating profit up 55% at £32.9m and underlying EPS up 66% at 4.8p…..

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Meta, owner of Facebook, Instagram and WhatsApp, has reported Q4 numbers and said that its Q1 numbers may not meet expectations. Meta expects Q1 revenue between $39.5 billion and $41.8 billion, compared with analysts’ average estimate of $41.72 billion.

Microsoft has reported Q4 numbers at the lower end of estimates. The group’s shares fell by 3.3% in after-hours trading.

FINANCE & MARKETS:

The SMMT is reporting that British car and van production will fall to a 70-year low this year.

The Resolution Foundation has warned that higher government borrowing costs could trigger further tax rises.

US President Donald Trump has criticised the US Fed after it left rates unchanged despite his calls to cut them.

Sterling mixed at $1.2442 and €1.1952. Oil lower at $76.82. UK 10 year gilt yield down two basis points at 4.60%. World markets mixed yesterday and London set to open down around 8 points as at 6.30am.

RETAIL WITH NICK BUBB:

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