Marston’s, On the Beach, consumer spending, labour market & other:

A DAY IN THE LIFE:

Living in York as we do, you quickly find out that the plays on the place name are legion.

Indeed, a ten minute drive across town turned up YorMed (on an ambulance), Yorvale (on an ice-cream ad) and Yorsexualhealth (on a building, no comment, ‘discretion assured’).

And the latter spurned, for some unknown reason, readily-available and nicely alliterative alternatives that I’m too polite to mention but it did make me think that Langton Capital should change its name to Yorcapital or even the painfully trendy YorCap or some such.

Or even JorCap to play on the name inclusive of its Nordic heritage but the prospect of having to spell the name (“really, yes, no U and a J, yes, I know it doesn’t make sense’’) has thus far put me off.

Something that those companies with deliberately misspelled names out there probably have to face every day. Let’s move 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

PUBS & RESTAURANTS:

Consumer Spending:

Barclaycard has produced spending data for April saying that ‘consumer card spending grew by 4.5% compared with the same month a year ago. The card issuer reports that this is the fastest rate of growth since June 2023. It adds that ‘the month saw spending boosted by the warm weather and a late Easter weekend, with both essential and non-essential categories seeing strong uplifts.’ Barclaycard reports that ‘essential spending returned to growth at 3.1% (up from minus 2.9% in March), while non-essential spending rose by 5.1% – a 21-month high.’ It adds that ‘retail spending rose by 6.8% year-on-year, with every retail subcategory reporting growth for the first time since tracking of these categories began in 2019….’

• 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.

QSR and food-to-go.

Lumina Intelligence’s latest Operator Data Index has suggested that the UK’s QSR and food-to-go sectors should outperform other eating-out channels this year. The MCA reports Lumina as saying that QSR turnover is expected to grow 3.4% to £17.7bn this year, with outlet numbers up 1.5%….

• 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.

London al fresco eating:

The Mayor of London’s office has announced a new £300,000 “Summer Streets” Fund to boost al fresco dining across the capital this summer. It says that the pilot fund is ‘now open for London’s hospitality sector to boost al fresco dining and extend opening hours’ and adds that the ‘action comes as the Government gives new strategic licensing powers to the Mayor of London as part of a national first to boost hospitality, culture and nightlife….’

• 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.

Migration:

The government has announced an overhaul of the legal immigration system that will see recruitment criteria tightened. Sky News reports ‘’Get out there and do those jobs,’ Britons told – as government cracks down on foreign workers…’

• 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 news:

Celebrity chef Michel Roux has said that the situation facing the UK restaurant industry is ‘dire’. He says

MARSTON’S H1 RESULTS:

Marston’s reports underlying H1 revenue down 0.2% at £427.4m. EBITDA is up 13.8% at £85.9m and PBT has turned around from a loss of £0.2m to a profit of £19.0m. H1 this year does not include Easter whilst, in H1-FY24, which ended on 30th March, Good Friday fell on 29 March. EPS is up from zero to 2.2p and, as expected, there is no dividend. The company focuses on LFL sales that include Easter in both periods.

It says that LFL sales rose by 2.9% in the 31 weeks to 3 May, ‘with strong growth of 10.5% in the 5 weeks since the period end.’ Underlying revenue for the reported period is impacted by Easter and MARS says that ‘underlying pub operating profit increased by 20.1% to £63.3 million (H1 2024: £52.7 million), underpinned by strong operational delivery and strategic cost-saving measures’. The EBITDA margin ‘expanded by approximately 250bps supported by data and technology-led improvements in labour deployment and procurement efficiency which form a core part of our refreshed strategy.’

Strategic issues (and debt): MARS reports that recurring free cash flow came in at £5.9 million (H1 2024: £7.1 million), ‘reflecting the timing of working capital in H1, which we expect to largely unwind by the year end, and increased investment capex aligned to our strategic growth priorities.’ It says that capex was £31.0 million (H1 2024: £21.7 million) and says that debt has come down to £881.1 million (H1 2024: £1,160.9 million), largely due to the CMBC sale proceeds.

The leverage ration has fallen to 4.9x, down from 5.2x at FY2024. The group adds that ‘in line with net debt reduction, net interest costs have reduced to £42.8m (H1 2024: £48.3m). MARS adds that its pub format rollout is ‘progressing well, supporting broader appeal across guest segments. Of the 30 new openings planned for FY2025, 18 have already been delivered on time and on budget, with strong early trading and guest feedback.’

Outlook: MARS reports that ‘LFL sales in the 5 weeks since 29 March up 10.5%, demonstrating the Group’s strategic progress and the growing impact of revenue-driving initiatives.’ Easter and the good weather will clearly have helped. The company reports that it has seen ‘strong trading across key occasions – including Christmas, Mother’s Day, and Easter.’ It says that this ‘alongside the continued rollout of strategic initiatives with a strong pipeline of demand driving events, such as Trivial Pursuit ‘Win a Wedge’, reinforces confidence in encouraging H2 outlook.’

The group is ‘confident in delivering recurring free cash flow of over £50 million a year in the near-to-medium term, supporting further investment and deleveraging.’ It says it is ‘on track to deliver targets outlined at the October 2024 Capital Markets Day, with FY2025 performance expected to be in line with current market expectations.’

Company comment: CEO Justin Platt says ‘the first half has been a period of significant momentum for Marston’s, with the execution of a market leading pub operating model, investment in our differentiated pub formats and progress in our digital transformation driving strong margin and profit growth.’ He adds ‘we continue to deliver great guest experiences every day, powering our industry-leading guest reputation scores. With strong recent trading across our nationwide estate of great local pubs, we are excited for the summer months ahead.’ Mr Platt concludes ‘we remain confident in achieving our financial goals for the full year and focused on executing our strategy as a pure play hospitality company to deliver sustainable growth and increasing returns for our shareholders.’

COMPANY NEWS:

Marston’s has partnered with renewable energy solutions provider Two Blues Solar and installer Nuvolt to deploy solar across 120 of the Group’s community-based pubs over the next 12 months.

City AM reports that Iconic Square Mile dining spot M Restaurant, which is owned by Rare Restaurants, the owner of the Gaucho chain, is to shut for good next week after 10 years serving steak to the City.

Cranswick owned Northmoor Farm in Lincolnshire is facing cruelty allegations after an investigation by the Animal Justice Project, first reported by The Mail on Sunday. Britain’s biggest supermarkets have suspended their relationship with the farm in response to undercover footage showing workers illegally killing animals with their bare hands.

The MCA reports that Boss Pizza is planning to open 20 new UK restaurants over the next 18 months, with a further 50 sites in the pipeline.

Luckin Coffee, which is now the largest coffee chain in China, is reported set to make its U.S. debut in New York City, at 755 Broadway. A note on the property says ‘opening Soon Luck In New York.’ It is thought that the company has been considering a move into the US for some time.

HOLIDAYS & LEISURE TRAVEL:

On the Beach has reported H1 numbers saying that revenue rose by 7% to £64.2m. The group reports adjusted PBT up 23% at £3.3m. CEO Shaun Morton says ‘this record interim performance was driven by increased passenger bookings and reflects the strength of the On the Beach holiday proposition.’ He adds that ‘demand for holidays remains strong as our customers continue to prioritise travel….’

Heathrow Airport yesterday released traffic stats for April showing that 7.1 million people passed through the airport last month, compared to 6.7 million in April 2024. CEO Thomas Woldbye says ‘we’re now firmly focused on the busy summer ahead and work is underway across the airport to ensure we continue delivering for our customers.’

IHG Hotels & Resorts has announced the signing of three new hotels in the Kingdom of Saudi Arabia.

FINANCE & MARKETS:

The US and China have agreed to cut tariffs for a 90-day period to 30% on Chinese goods coming into the US and 10% in the case of US goods coming into China. US sector-specific tariffs, such as the 25% tax on cars, aluminium and steel, remain in force….

The ONS has updated on the UK jobs market saying that ‘annual growth in employees’ average earnings for regular earnings (excluding bonuses) was 5.6% and total earnings (including bonuses) was 5.5%.’ it adds that ‘annual growth in real terms was 2.6% for both regular and total pay.’

Re employment levels, the ONS says that ‘estimates for payrolled employees in the UK decreased by 47,000 (0.2%) between February and March 2025 and fell by 63,000 (0.2%) between March 2024 and March 2025.’

Economist Joseph Stiglitz has told Sunday Morning with Trevor Phillips that the UK-US trade agreement is not ‘a great achievement.’ He says ‘any agreement with Trump isn’t worth the paper it’s written on’ and says he would view the agreement ‘as playing into Trump’s strategy.’

City AM reports that several members on the Bank of England’s Monetary Policy Committee have warned that sticky inflation could stall further interest rate cuts this year in marked contrast to current analyst expectations.

Sterling mixed at $1.3192 and €1.1878. Oil higher at $64.87. UK 10 year gilt yield up 8 basis points at 4.65%. World markets mixed yesterday and London set to open down around 25 points as at 6.30am.

RETAIL WITH NICK BUBB:

• 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.