M&B, TGI Friday, Travelodge, incomes, employment rights & other:

A DAY IN THE LIFE:

Well, we’re creeping towards the end of what has felt like a long month.

And, though there will have been five weekends in November 2025 and therefore fewer working days than would normally be expected, it has been mentally draining.

Particularly as the Budget, now thankfully in the rearview mirror, was written in full public view, scrapped and re-written more than once in the run up to last Wednesday.

And this put a lid on consumer spending, corporate investment, hiring, Christmas planning and the rest such that, when transport secretary Heidi Alexander told Laura Kuenssberg last Sunday that budget leaks and uncertainty had not damaged the real economy, there will have been many a cornflake spat out across the UK’s breakfast tables.

The most charitable response would be ‘you should get out more’ but, as we can only play the ball we are bowled by the politicians, it’s time to put all of those Christmas preps into action.

Have a great weekend. Good luck to Hull – no points from the last six – and let’s move on to the news.

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MITCHELLS & BUTLERS – FULL YEAR NUMBERS:

MAB reports ‘strong trading ahead of the market with like-for-like sales growth of 4.3%. It says that total revenue is £2.71bn vs £2.61bn in the prior year. Operating profit is £322m (FY24: £300m) and PBT is £238m against £199m in FY24. On an adjusted basis, operating profit is £330m is up 5.8% from prior year and adjusted PBT is £246m against £211m last year. The group reports that it has seen an increased adjusted operating margin of 12.2% (FY 2024 12.0%) and says that strong cash flows have reduced net debt (excluding leases) by £146m. NAV is up to 476p from 433p at the end of FY24. Re current trading, the group says it has made a ‘solid start to FY 2026’ with like-for-like sales growth of 3.8% in the first eight weeks

PUBS & RESTAURANTS:

Disposable incomes:

With growth estimates down and the tax take rising, many consumer will face a ‘truly dismal’ increase in their disposable income over the next few years reports the Institute for Fiscal Studies. It says that consumers may find themselves around 0.5% better off per annum in real terms. The OBR estimates real growth in the economy of an average of 1.5% over the next five years. The IFS number implies that two thirds of that growth will be taken in taxes by the government…

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Costs:

Whilst relatively high inflation in the UK is likely to remain a feature over the medium term per the OBR, this has abated somewhat. Nevertheless, work by the Boston Consulting Group illustrates that beef prices have risen by 27.4% over the past year…

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Employment rights:

Business groups have welcomed the decision to introduce a six-month qualifying period for unfair dismissal in the Employment Rights Bill. The six business groups involved in discussions say that ‘businesses will be relieved that the Government has agreed to a key amendment to the Employment Rights Bill which can pave the way to its initial acceptance.’ They say they ‘have always been clear that making the Employment Rights Bill work would take business, trade unions and government working together to find a landing zone for these major policy changes….’

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Other news:

UKH says that ‘the Scottish Government has a clear opportunity to support the vital Scottish hospitality sector, by using Barnett consequentials arising from the UK Budget to expand existing business rates relief to include all Scottish hospitality businesses…’

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COMPANY NEWS:

Sky News reports that TGI Fridays’ UK chain is up for sale again, within a month of changing hands. It says the ‘fate of TGI’s 49 British restaurants and 2,000-strong workforce is again uncertain after Interpath was hired to canvas appetite from potential investors…’

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Three-strong Irish pub chain Nancy Spain’s is seeking to raise money on Crowdcube off a pre-new money valuation of £8m. The company has current sales of £3.8m…

Lucky Cup has become the third Chinese coffee shop chain to exceed 10,000 outlets. Luckin Coffee has 30,000 units and Cotti has around 15,000.

HOLIDAYS & LEISURE TRAVEL:

Travelodge has warned that a ‘barrage of rising costs’ will significantly impact its operations and could reduce demand. it says that the rise in the national minimum wage will cost it around £11 million by 2026. Business rates bills will rise and tourist taxes, which may be introduced by a number of councils, could depress demand…

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Heathrow airport has suggested that it faces business rates bill increase of as much as £145 million by 2030. Other airports could face similar percentage cost increases. Karen Dee, chief executive of Airports UK, says this ‘could still force some to review billions of pounds of transformational investments across the UK and potentially puts thousands of jobs at risk in the longer-term….’

APD will rise in line with inflation. Business Travel Association CEO Clive Wratten says that the rises ‘risk undermining growth at the very moment the UK economy needs it most.’ Re corporate travel in general, he says ‘mayors being given the power to introduce an overnight visitor levy has been positioned as a tool for local investment, but this will directly increase the cost of travelling for work in the very regions the government is seeking to level up.’

OTHER LEISURE:

The FT has suggested that gambling tax increases proposed in Wednesday’s budget could spur a spike in corporate activity.

Another day of volatility in share prices for gaming stocks and their service providers. Late afternoon saw Rank 8% down after a 10% rise on Wednesday. Evoke was down 4% after an 18% drop the day before. Entain was little-changed after a 3% rise on Tuesday and Playtech managed a second day’s major rise, up 10% after a rise of 6% on Tuesday.

FINANCE & MARKETS:

Markets are now pricing in a c90% chance for an interest rate cut when the Bank of England next reports its MPC’s findings on 18 December. Should this happen, it may go some way to mitigating the cost increases coming business’s way as a result of the Budget and announcements on the National Living Wage….

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City AM reports ‘several top economists’ as warning that the UK remains in a weak fiscal position after Wednesday’s Budget….

Sterling down at $1.3228 and €1.1425. Oil higher at $63.54. UK 10 year gilt yield up 3 basis points at 4.45%. World markets mostly better yesterday and London set to open around 15 points better as at 6.30am.

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