PREMIUM – Jet2, RBI, Gail’s, inflation, insolvencies, trading & other:

A DAY IN THE LIFE:

I was thinking about the evolution of language the other day, the process whereby words, such as Wi-Fi, laptop, internet, metaverse etc come into usage and other words, like Gammon (as a pejorative) get a retread and come out to play again.

And other words die out.

And, re the latter, whilst I’m just about aware of what a cobbler’s last is, it’s redundant information as I’m more likely to be announced as the beleaguered Rachel Reeve’s replacement than I am to be found making shoes in future.

Similarly the verb to darn and its derivatives, and scuttle, noun, vessel, coal, for the carrying of are also likely to be on the way out, to feature in future only as Trivial Pursuit questions or some such.

Or, in the same way that measures such as Firkin, admittedly with a bit more of an obvious link, have made it into pub names, maybe there will be a Rusty Scuttle serving beer at some point in the future.

On to the news:

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PUBS & RESTAURANTS:

Trading.

The Oxford Partnership has reported that the UK hospitality industry is seeing ‘encouraging signs of recovery and changing consumer trends’. The Partnership says its latest Market Watch Snapshot reveals a shifting landscape in UK hospitality, with some sectors showing resilience and even growth, despite challenges in trading conditions….

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Disposable incomes:

Whilst real incomes seem to be rising at a healthy pace, it’s beginning to look as though energy prices will rise again in April. Cornwall Insight says bills should rise by 5% or an average of £85 a year per household from Q2. Bills remain around 50% higher than pre-Covid levels but they are markedly below the peak seen in the wake of Russia’s invasion of Ukraine in 2022.

Inflation:

The ONS has updated on CPI (for January) in the UK saying that CPI rose by 3.0% in the 12 months to January 2025, up from 2.5% in the 12 months to December 2024. It says that ‘on a monthly basis, CPI fell by 0.1% in January 2025, compared with a 0.6% fall in January 2024.’ The ONS adds ‘the largest upward contribution to the monthly change in both CPIH and CPI annual rates came from transport, and food and non-alcoholic beverages; the largest downward contribution to both came from housing and household services….’

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Insolvencies:

The Insolvency Service has released company failure numbers for January 2025 for both corporations and for individuals. The Service reports that, in the month of January, there were 1,971 registered insolvencies, 6% higher than in December 2024 (1,852) and 11% higher than the same month in the previous year (1,780 in January 2024)….

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Other news:

Waste management company Biffa has commissioned a report that suggests around 47% of UK adults still admit to being baffled when it comes to recycling. Biffa says that the widespread confusion means broken glass (36 per cent) and aerosol cans (21 per cent) are regularly ending up in the general waste bin when they could be recycled….

COMPANY NEWS:

Speaking on the Hungry podcast, Gail’s co-founder Tom Molnar says that the company uses a computer algorithm to examine demographics and target neighbourhoods for new stores….

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Restaurant Brands International has outlined its plans for Burger King in China saying that it has acquired its current partners’ stakes and will now set out to ‘identify a new local operating partner….’

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Writing in the MCA, former Times leisure correspondent Dominic Walsh comments on C&C saying that ‘Roger White, who is only a few weeks into the role [of CEO], is a terrific catch for C&C.’ he says ‘White is expected to waste no time taking up the C&C baton and chipping away further unsuitable brands and products as he drives the group’s cash-generative qualities to strengthen the balance sheet.’

Wendy’s in the US saw consumer demand slackening towards the end of 2024…

Costa Coffee is to raise the pay of its baristas by 5% across all its stores. The basic rate rises from £12 per hour to £12.60 from 1 April 2025.

JET2 TRADING UPDATE:

Jet2 has this morning updated on trading for the FY to end-March 2025 to date and our comments thereon are set out below:

Company update: Winter 2024/25 – JET2 reports that capacity for winter is up 14% on last year with the ‘later booking profile experienced during Summer 2024 having continued’. The company says ‘season to date booked average load factor is down by 2.2ppts, with the month of March and the later timing of Easter year-on-year contributing 1.3ppts of this decrease. Overall pricing for the season has remained competitive.’ Jet2 reports that ‘the Board expects to report a Group profit before foreign exchange revaluation and taxation for the year ending 31 March 2025 of between £560m and £570m, an 8% to 10% increase on the prior year.’ It adds ‘this range excludes gains from asset disposals, including the ongoing sale of our recently retired Boeing 757-200 fleet, details of which will be provided in our April post-close trading update.’

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HOLIDAYS & LEISURE TRAVEL:

The latest European tourism statistics suggest that consumers are prioritising shorter breaks in value for money destinations.

Visit Britain has reported that spending by international visitors in the UK should rise by 7% year-on-year to £33.7 billion in 2025. The body suggests that some 43.4 million visits will be made to this country this year, up 5% on the 41.2 million expected in 2024…

The RMT has welcomed the government’s plans to unify Britain’s railways but says further action is needed to tackle inefficiencies and ensure long-term improvements for passengers and rail workers.

The CMA is reported likely to soften its stance on the proposed $570 million purchase of CWT by Amex. The CMA has published a supplementary interim report assaying that it ‘provisionally considers that the deal should be allowed to proceed.’

FINANCE & MARKETS:

For inflation, see Pubs & Restaurants above.

Governor of the Bank of England Andrew Bailey has said that the UK economy is becalmed in a ‘weak growth environment’. He suggest that trade issues, with the EU post Brexit and potentially with the US in the face of tariffs, could exacerbate the situation.

The acceleration in UK pay growth may restrict the number of rate cuts the Bank of England will be able to make this year.

Glenigan’s February 2025 Construction Review has signalled a sharp slowdown in construction activity. It says this is down 19% y-o-y in the three months to January.

Sterling up at $1.2622 and €1.2076. Oil higher at $76.06. UK 10 year gilt yield up 5 basis points at 4.56%. World markets mixed yesterday and London set to open barely changed as at 6.30am.

RETAIL WITH NICK BUBB:

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