PFD, RedCat, Butcombe, Flutter, trading, cost inflation, GDP & other:

A DAY IN THE LIFE:

I have it on good authority that Human Beings smell bad but look good.

Or, actually, the truth is that humans have the worst sense of smell across all mammals but the best vision and, if that’s the deal, I’m pretty OK with it.

Because, though the dog knows when I’ve got a biscuit in my pocket and, for all I know, will have a sense of every person, animal or thing that’s passed a certain spot in the last few minutes or hours, she can’t see a rabbit unless it moves and has been known to walk past a stationary cat without blinking only to jump back in terror when faced with a wind-blown cardboard box.

Maybe the latter looked like a snake – check out cats & cucumbers – but, to my mind, avoiding virtually weightless paper objects is a waste of time and it’s definitely sub-optimal if you jump into traffic to do so.

Still, watching the dog’s nose twitch as she sleeps, I tend to think that she’s happy with the deal as well. On to the news:

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PUBS & RESTAURANTS:

Trading:

The Oxford Partnership’s April 2025 Market Watch Snapshot reports that there has been ‘a positive upswing in the UK’s on-trade hospitality sector, as warmer weather and Easter trading delivered a much-needed lift in performance across pubs, bars, and restaurants.’ It says that ‘after a slow start to the year, draught beer sales rebounded strongly, with total volumes rising by 5.0% in the latest four weeks….’

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Further on trading:

Lumina Intelligence has also commented on trading saying that warm weather has fuelled a 9.2% increase in visit frequency, with customers now averaging 1.6 pub visits weekly. Speaking to the MCA, it says its latest Eating and Drinking Out Panel snapshot for the four weeks to 13 April 2025 found that pubs and bars captured the largest share growth of any sector, up 2.7ppts year-on-year….

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Foodservice price inflation:

The latest CGA Prestige Foodservice Price Index has revealed ‘a marginal increase in year-on-year inflation in the hospitality sector, rising to +2.0% in March from February’s +1.8%.’ The Index reports that ‘while overall year-on-year inflation remains relatively low, the latest data presents a nuanced picture. The oils & fats category continues to be the most inflationary category, with a significant +5.8% increase compared to March 2024. Sugar, jams, syrups and chocolate also remain subject to inflationary pressures, with a +2.4% year-on-year rise—partly due to ongoing volatility in cocoa pricing….’

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COMPANY NEWS:

Compass Group shares slipped a little yesterday on the back of the company’s H1 results, ending the day down by around 2.8% at £25.33.

Sky News reports that RedCat Pub Group, ‘founded by the ex-boss of Greene King is in advanced talks to buy a swathe of sites from his former employer in a £90m deal.’ It says that RedCat is ‘close to finalising the purchase of 39 pub-hotels from Greene King’ and adds that ‘sources’ say a deal could be struck within days….

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Stonegate Group has reported that sales of low and no beers and ciders rose by 32% in Q1 this year compared with the same quarter last year….

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Butcombe Group has reported numbers for the year to 25 January 2025 saying that it has achieved ‘record results and strong start to new financial year.’ The company reports record revenues of £149m versus £144.4m in the previous year and managed pubs ‘strongly outperformed the sector with like-for-like revenue of +7.8%.’ The company adds that it ‘enhanced EBITDA margins across the group, with 150 bps improvement in the managed estate.’ It reports ‘7.4% growth in underlying group EBITDA and 8.1% growth in Divisional EBITDA….’

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PREMIER FOODS FULL YEAR NUMBERS:

Premier Foods reports revenues up by 3.5% at £1.15bn with adjusted PBT up by 8.8% at £169.3p, The group reports EPS up from 13.5p on an adjusted basis to 14.5p and there has been a ‘step up’ in the level of dividend payments for the full year from 1.728p to 2.8p (+62%). The company reports that branded revenue rose by 5.2% ‘due to strong branded volume growth’ with headline revenue up 3.5%. It says that Grocery branded revenue rose by 4.6% and Sweet Treats branded revenue rose by 7.3%. The group says that it has taken market share in both volume and value. Net debt is down by £92.0m on last year and net debt to EBITDA has been reduced to 0.7x. The group has ‘agreed [a] full pensions merger’ and the ‘dividend match’ limitation has been removed. The group says that it is ‘on track to achieve full [pension fund] resolution by end of 2026.’

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HOLIDAYS & LEISURE TRAVEL:

TUI AG shares closed down around 10% yesterday on the back of what were considered to be disappointing H1 numbers.

Speaking at the Advantage Travel Partnership 2025 Conference, director John Sullivan has said that consumers appear to be focusing on value. He says that sales are up despite a slow start to the year…

Also at the 2025 Conference, CEO Julia Lo Bue-Said has warned President Trump’s aggressive comment towards allies and tariff flip-flopping could ‘reshape’ demand when it comes to international travel…

OTHER LEISURE:

Flutter Entertainment has announced that it has ‘completed the acquisition of an initial 56% stake in NSX Group, a leading Brazilian operator of the Betnacional brand for cash consideration of approximately $350m’. it says ‘the transaction aligns with Flutter’s strategy to invest in leadership positions in attractive international markets and is expected to create shareholder value.’

Rank Group yesterday commented that legal changes regarding the number of gaming machines and the opportunity to provide sports betting in casinos in England and Wales should be very positive for the group. Rank’s shares rose around 7% on the news…

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The Guardian reports that ‘senior figures in horse racing’ have broken ranks with other gambling companies and have ‘signalled they would no longer object to tougher taxes and regulation of online casinos…’

Oak View Group, which co-owns the UK’s largest indoor arena, Co-op Live, has told City AM that it is looking at building up to two new venues in London at a cost of around £1.5bn.

FINANCE & MARKETS:

The ONS reports today that ‘UK gross domestic product is estimated to have grown by 0.7% in Quarter 1 (Jan to Mar) 2025, following growth of 0.1% in the previous quarter.’ It says service production rose by 0.7% with manufacturing up 1.1%. It adds that ‘real GDP per head is estimated to have grown by 0.5% in Quarter 1 2025, following two consecutive quarterly falls….’

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Goldman Sachs has raised its forecast for economic growth in the UK and the Eurozone as some of the worst tariff fears begin to ease. The investment bank expects growth in the EU of 0.1% in both Q3 and Q4 this year. It expects growth of 0.6% in Q3 and Q4 in total versus earlier estimates of 0.4%.

Bank of England MPC member Catherine Mann has said she voted to keep interest rates on hold last week due to the relative resilience of the UK’s labour market. Ms Mann was outvoted and the Bank cut rates by 0.25%.

China has reportedly criticised the trade deal between the UK and US saying that it could be used to target reductions in Chinese sales into the UK.

The Bureau of Labour Statistics in the US has reported that inflation in that country slowed to 2.3% in the year to April, down from 2.4% in the year to March.

Sterling weaker at $1.3274 and €1.1864. Oil lower at $64.54. UK 10 year gilt yield up 5 basis points at 4.72%. World markets mostly lower yesterday and London set to open a fraction down as at 6.30am.

RETAIL WITH NICK BUBB:

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