BrewDog, IHG, PFD, Barclaycard spend data, West End, flights & other:

PREMIUM EMAIL – PLEASE DO NOT FORWARD:

A DAY IN THE LIFE:

I was thinking the other day about truisms that, well, simply aren’t true at all.

For example, in response to something surprising, a person could say ‘well, truth is stranger than fiction,’ and we may all nod.

Although heaven knows why because it simply isn’t.

I could posit that a two foot high green man fell to earth and drove the no6 bus into York every day for a month while smoking dope (the little green man, not me) and it would be hard to find much in the true-o-sphere that was much stranger than that.

You might counter with ‘I found a tenner in the street and it turned out it was me that dropped it’ but, well, that’s not in the same league, is it?

And nor are the top examples you might find on the Internet.

The Taiping Rebellion was actually initiated by somebody who thought they were Jesus’s younger brother. But he was just an egomaniac or a nutter or both. And Donald Trump’s political career isn’t stranger than fiction as it, also, is just proof that egomaniacs and nutters exist in large number in mature democracies and I could go on.

But I won’t as it’s Friday and, after we slog through the next few hours, we’ve got the weekend to look forward to, so let’s move on to the news:

PUBS & RESTAURANTS:

Barclaycard spending data:

Barclaycard has produced spending data for April saying that ‘consumer card spending fell by 0.1% in April 2026, the first fall since November 2024 (minus 0.5%).’ The card company reports that ‘overall card spending edged lower in April as consumers took a more cautious approach to discretionary spending – particularly Travel.’ It says that ‘growth was maintained in select areas, with Digital Content and Beauty continuing to outperform.’ Barclaycard adds that ‘major events such as the London Marathon helped support the hospitality sector….’

• Consumer concerns / trends: Barclaycard reports that 72% of ‘consumers are concerned that the current tensions in the Middle East will impact the cost of living through to the end of 2026, however more than half (52%) feel confident in their ability to make good financial decisions in uncertain times.’ It says that some ‘52% say they are able to manage their day-to-day finances without significant stress.’ As many as 62% of consumers are ‘taking action to reduce their outgoings in response to ongoing uncertainty.’ Re big ticket spending, and this may account for the drop in travel spend, some ‘26% say they’re delaying major financial decisions.’

• Hospitality & Leisure: Barclaycard reports that ‘spend in the overall Hospitality & Leisure sector fell 1.3% in April year-on-year, a decline compared to March 2026 (0.9%).’ The card issuer reports that restaurant spend was up by 1.1%. This is clearly below the rate of inflation and transaction numbers fell by 0.7%. Spend in Bars, Pubs & Clubs spend was up by 1.0% with transaction numbers unchanged. Takeaway and Fast Food spend was down by 1.3% with transaction numbers down by 6.4%.

• Travel: It says that the ‘decline was largely driven by weaker Travel spending, which fell 5.7% in April after a 3.3% decline in March 2026, with Airlines spend down 8.3% in the month. Barclaycard reports that ‘hospitality & Leisure spend declined in April, driven by ongoing weakness in Travel as consumers responded to rising cost concerns and disruption, prompting some to delay holiday decisions.’ It says that ‘demand for UK staycations provided some support.’ It adds that ‘major events such as the London Marathon helped boost hospitality activity in the capital.’

• Entertainment: Here, spend was down by 0.6% with transaction numbers, somewhat oddly, up by 6.9%.

• Langton comment: The overall number here is firmly negative both in real terms and, for the first time in a while, in nominal terms. Barclaycard does pick out some bright spots and, across the whole economy, there will always be some. However, below the top line revenue figure, costs, not covered here, are now a major issue from the beginning of April when NIC rises and threshold changed and the NLW rose. With revenues down in real and nominal terms and geopolitical concerns perhaps threating to hold back spend in the short term, trading, it would appear, remains challenging.

West End demand, rents etc.:

West End landlord Shaftesbury Capital PLC yesterday updated on trading saying that the company ‘has made a positive start to 2026, demonstrating the strength and resilience of our prime West End portfolio…’

• CEO Ian Hawksworth says ‘despite an uncertain geopolitical backdrop, our portfolio continues to perform well, with 151 new leases and renewals completed year to date, 5 and 18 per cent ahead of market rents and previous passing rents respectively.’ What is good news for the landlord isn’t necessarily always good news for the tenant as the company goes on to say that ‘there continues to be competitive demand for space in our high-footfall destinations.’

• The CEO says that only 2.5% of the estate is vacant and 1.2% is under offer. The company adds that it is seeing ‘continued momentum at Covent Garden, with recent transactions including…the introduction of Covent Garden Market Bar by Inception Group.’ He adds that ‘Burro, an original dining concept delivering high-quality Italian cuisine, opened to critical acclaim in Floral Court.’

• The group is ‘making progress in evolving Carnaby Street ‘ and says that ‘Chinatown is fully occupied, new additions include POP MART which opened its largest London store on Charing Cross Road following strong UK performance, and Darjeeling Express will upsize into a larger restaurant on Rupert Street.’

COMPANY NEWS:

Lavval Group, which trades as The Spaghetti House, has closed its five restaurants and called in BTG Begbies Traynor as administrators of the business.

Oaknorth has commented on its funding for Rosa’s Thai saying that it is ‘a high-quality, well-established brand with a clear growth trajectory and strong customer proposition….’

• Oaknorth adds that ‘despite a challenging backdrop for the hospitality sector, the business has demonstrated resilience and continued demand, underpinned by an experienced management team and the support of a highly credible sponsor in Trispan. We’re pleased to deepen our relationship with the group and support their ambitious expansion plans, building on our experience of backing leading hospitality businesses across the UK.’

• Rosa’s Thai has released some headline numbers but has yet to formally lodge its overdue March 2025 accounts with Companies’ House.

Tilray Brands, which has owned the bulk of BrewDog since it purchased some of the collapsed company’s brands and assets from its administrators in March, has said that it is ‘shaking up the ready-to-drink category with new Wonderland cocktails inspired by nostalgic flavours. Tilray has said that it feels able to build BrewDog into a $1bn brand.

PREMIER FOODS – FULL YEAR ANALYSTS’ MEETING:

Following the release of its full year numbers, Premier Foods hosted a meeting for analysts and our comments thereon are set out below:

Trading:

• See also earlier Flash Note.

• Financial summary. Sales momentum picked up in H2 vs H1. The timing (and cold weather) over Easter, helped. Cash flow was strong, the dividend is up by 20% and an interim will be introduced from November. Five year KPIs look impressive (slide 6).

• Grocery, which includes acquisitions, has performed well. Non-branded is ‘right-sizing’ both in Grocery & Sweet Treats. This is set to continue.

• Cash flow has doubled over five years, despite M&A, increased dividends and internal capex. Net debt has fallen from £144m to £95m. The current year will be 53-weeks.

• Pensions. Schemes now merged, no deficit contributions, dividend restrictions removed & admin fees now to be removed. There ‘could be some sort of surplus to be shared between pensioners and the company by August this year’.

• Debt. Co will ‘operate between 1x and 2x over time. Fire-power, given this, is substantial.

• Re weight-loss drugs, PFD reports that family meals are still being made, but there is a major drop in eating-out-of-home. Snacking may drop, although this is not visible in the numbers. Overall, this could be a modest positive.

Strategy:

• Broadly unchanged. Grow the UK core, invest in operations, introduce new categories, build international sales & M&A.

• The group has ‘enhanced capital allocation opportunities.’ Internal capex and marketing spend are higher and the dividend hike, with an interim to come in the current year, is a major positive.

Q&A:

• Co is ‘not currently being impacted by any trading down across customers’.

• Cost increases? Many costs are currently fixed, but how long does this last? Co will not give exact details but says it ‘has some time’. If it thereafter needs to raise prices, then it ‘will reluctantly do so’.

• Iran war? Can only really keep an eye on things at this stage. No impact other than energy costs.

• New products’ contribution? This should all represent additional sales with minimal cannibalisation.

• Pension ‘surplus’?

o Co not wish to comment on the possible size. Will update in due course.

o How will this be shared with the trustees? Won’t say at this stage. Rules at present suggest the scheme would need to be wound up in order to access surpluses.

• Marketing and advertising spend progression? No numbers mentioned but the co has ‘made really great progress’. Co is ‘a good way down the journey’.

• Australian de-stocking; where are we now? There is a degree of opacity. There may ‘still be some stock to come out of the pipeline’. Co is ‘seeking transparency’.

Langton comment:

• Premier Foods reports numbers ahead of already-increased guidance and it is pointing to further growth in the current year.

• PFD’s Q1 – calendar Q2 of 2025 – was hot and, given the nature of its products, this was unhelpful. In FY27, therefore, comps are currently soft and trading should be ahead.

• The group remains highly cash generative’ and, with strong EBITDA delivery, it now has ‘enhanced capital allocation opportunities.’ The dividend hike, with an interim to come in the current year, is a major positive.

• Selective acquisitions remain an ongoing possibility. Indeed, a likelihood and the company, though it is much larger than it was, is still of a size where acquisitions can make a material difference.

• We would expect further developments in due course.

HOLIDAYS & LEISURE TRAVEL:

ACI Europe has said that it does not expect passenger volume in Europe to fall this summer unless there are ‘significant’ fuel shortages…

• This may be akin to saying that things will be good unless they aren’t but, despite having said that Europe was only weeks away from fuel shortages, ACI says that passenger growth was 3.8% in March, the first full month of the Iran conflict, only slightly down on the 4.2% recorded in February.

• ACI director general Olivier Jankovec says ‘looking at the peak summer months ahead of us, we do not — for now — expect a contraction of passenger volumes, unless we end up facing significant jet fuel shortages.’ He says ‘Middle Eastern airlines are now restoring their European network while European ones have only made limited capacity adjustments — reflecting the protection afforded by fuel-cost hedging strategies and the continued resilience of demand.’

Intercontinental Hotels has reported that it ‘continues to see strong momentum in the Americas region – the company’s largest – across its entire brand portfolio.’ It says that ‘in addition to 24 hotels opening in the first quarter, IHG added 65 more hotels and nearly 6,000 rooms to its Americas development pipeline, underlining growing owner demand for its brands….’

• IHG reports that ‘the region also delivered strong RevPAR growth in the first quarter across every chain scale and every IHG brand, driven by increases in key demand segments of business and group travel, together with robust leisure performance. The U.S. drove IHG’s performance, complemented by strong growth in Central America and the Caribbean, alongside continued momentum in Canada.’

• Mark Sergot, Chief Development Officer, Americas at IHG, says ‘our new deal growth reflects the strength across our entire brand portfolio and the confidence owners have in IHG. Pipeline additions were up more than 30 percent year-over-year in the first quarter, driven by continued demand for conversion opportunities and growth across key segments including Suites and the Holiday Inn brand family.’

The European Commission is reportedly proposing new rules that would make it easier to cross multiple borders in Europe by rail.

CoStar reports that the US hotel industry turned in positive metrics in the week to 5 May. It says that occupancy was 0.3% higher and ADR was up by 1.7%. The resulting REVPAR was up by 2.0%.

OTHER LEISURE:

Lego Digital Play, Lego’s move away from physical bricks, is reported to have made a profit in its first year of operation.

FINANCE & MARKETS:

Sterling a little weaker in light of the ruling Labour Party’s internal divisions at $1.3478 and €1.1550. Oil off a little at $104.70. UK 10 year gilt yield down around 5 basis points at 5.02%. World markets broadly better yesterday.

RETAIL WITH NICK BUBB:

Nick is taking a short break.