Monthly Archives: October 2016

Friday Opinion – Hospitality

Propel

Friday Opinion – Hospitality

What I’ve learnt about hospitality in the name of research by Victoria Searl

In London, they say, you’re never more than three feet from a cool new restaurant or hipster cafe and, in the name of research, I’ve tested a load of them for you. Here are my findings:
Restaurants aren’t always about hospitality any more
I don’t believe in naming and shaming so I won’t, but a recent visit to a cool, “small plates-type” place in Covent Garden was so unwelcoming it left me feeling hugely embarrassed in front of the guest I’d suggested the venue to. Being rushed through a meal and then asked to stand in the doorway to finish an expensive bottle of wine – so they could turn tables faster – only left a bad taste in my mouth. I do, however, believe in shouting about great service, so thank you to Hawksmoor Covent Garden for rescuing the evening with its usual exceptional and effortless hospitality.
Operational excellence is a dark art to many independents
A place near me in south London sells amazing pancakes. In fact, I could murder a couple right now. Problem is, this uber-cool little all-day cafe has the worst operational set up I’ve seen, meaning only one ticket can be prepared at a time, putting an average 45-minute wait between me and those tasty breakfast treats. Another haunt of mine makes really good avocado on toast. Well, sometimes. The problem is the spec changes every visit. The accompanying egg varies from raw to hard-boiled, despite me stating a preference which is neither, and on my last visit I was treated to a thick layer of pickled something artfully strewn across the top. Consistently different isn’t the kind of consistent I’m looking for.
Many startups don’t have a fighting chance
A small, all-day restaurant near me has a wage bill that must eat every pound of profit it makes. This tiny space often has three people behind the counter, three in the kitchen and a very harassed-looking owner rushing around trying to hold it all together. Despite the abundance of help, I’ve still had to ask three times for the honey that goes with my French toast, and waited an age to pay at the end. I’ve given honest and helpful feedback when asked and been met with a blank stare. Clearly staff know they should be asking for feedback in an area full of locals, but have no idea what to do with it once they have an answer. It’s agonising to see a cafe or restaurant open then close within a few months because the owner’s love of food just hasn’t been enough to sustain an actual business.
Great hospitality is unbelievably powerful
There are all sorts of ways of getting great food now, the rise of Deliveroo has shown that restaurant-quality home eating, for example, has never been more accessible. But what a skilled home chef or a student on a mountain bike can’t provide is service, the bit that turns a meal into an experience and, when done really well, can leave you walking on air for days. This is infinitely more beneficial to your business than the “wham, bam, thank you ma’am” approach.
Consistency is key
Independents may actively try to distance themselves from the ways of the big chains, but customers are attracted to return because of the experience they’ve had and, while surprises may be exciting, they aren’t something you can rely on. Whatever type of business you’re in, brand loyalty is built on loving something – and knowing it will be exactly the same or better every time you try it.
There is much more to running a hospitality business than a love of food
Owners need to surround themselves with expertise and apply operational efficiencies – as long as they aren’t detrimental to the experience – wherever they can. Nothing remains the “cool new thing” for long, and it’s essential that the business is financially viable enough to sustain the regular reinvention so vital in today’s market.
Victoria Searl is a marketing and brand director with a passion for operations. She has worked for a number of sector companies, including Casual Dining Group –

This Weeks Leisure Industry News

Some of the weeks Leisure Industry News

If you would like to read the latest Industry News and Corporate Activity, please click on the following link     http://www.propelinfonews.com/selecttemp.php, before 9.00 am for yesterdays News, click on the link after 9.00 am for latest Weekday’s News

PUB, RESTAURANT & DRINKS PRODUCERS:

• Facebook has teamed up with groups including Deliveroo and ticketmaster to introduce a series of new features allowing users to order food and drinks on the platform.

• Fourth Hospitality has reported that ‘hourly pay in hospitality [is] racing ahead of living wage’. Says average rate now £7.71 per hour. Excluding under-21s, the pay rate rises to £7.92 per hour.

• Fourth Hospitality says industry is facing ‘very strong employment cost inflation’. Fourth’s Mike Shipley reports ‘with actual pay significantly outstripping the legal minimum for all age thresholds, businesses are clearly experiencing very strong employment-cost inflation.’ He continues ‘clearly it is difficult to predict whether this momentum will continue but there’s no sign of a levelling off at the moment. We expect to see the hourly-rate average in hospitality hitting £8 in January 2017, and we could well see average rates approaching £8.50 by April 2017 – when the next incremental increase comes into force. This could see the minimum legal living wage (for over-25s) move up to between £7.50 and £7.65.’

• Fourth Hospitality says Gender pay gap has totally disappeared. Males earned 13p per hour more last year.

• Fourth Hospitality reports the premium paid to London staff is narrowing – this despite crippling accommodation costs. Gap now just 11p/hour. Fourth says ‘it is clear that many of our clients are engaged in productivity programmes and initiatives, such as smarter rota scheduling and driving the amount of revenue taken per worker / per labour hour.  It is one of the key ways that hospitality and leisure companies can combat this era of aggressive labour inflation.’

• Pernod Ricard reports Q1 numbers, says are ‘consistent with existing FY17 outlook’. Organic sales growth 4%. Fourth Q1, total sales came in at € 2,248 million. The group reports ‘solid growth in Europe (+6%), partly favoured by technical impacts.’ Alexandre Ricard, Chairman and Chief Executive Officer, reports ‘we have had a good start to the financial year, consistent with our full year guidance. Therefore, we confirm our FY17 guidance of organic growth in Profit from Recurring Operations of between +2% and +4%. We will continue to implement our long-term growth strategy, focusing investments behind our priority brands, markets and innovations and remaining disciplined on pricing and costs.’

• Krispy Kreme UK has announced sales up 18.2% to £61.7m in year to end-Jan with profits of £11.8m (2015: £7.3m) per Propel.

• CAMRA may delay its final decision on its Revitalisation Programme until 2018, a year later than planned

• World wine output set to hit a 4yr low this year after bad weather hit France and South America

• Imbiba is to raise funds for three existing operations and one new company. EIS eligibility will set the 3yr clock running afresh one existing companies

• MPs have called for Sir Philip Green to be stripped of his knighthood

• ONS reports warm weather in September led to weak sales of food, clothing and footwear

• Carlsberg UK has added the craft lager ‘Celia’ to its premium beer portfolio from 1 November 2016.

• Starbucks is aiming to double its store count in China to 5,000 sites by 2021.

• Nestle has cut its annual growth forecast to 3.5% from 4.2% in August, citing ‘the current softer environment’, which is causing food prices to fall. Nestle’s nine-month sales were 65.51bn Swiss francs ($66.19bn, £53.93bn) up from 64.86bn Swiss francs last year and the group has struggled to increase prices in the face of intense competition from supermarkets.

• China has usurped the US as Australia’s most valuable export market. The value sales of wines to China grew 51% to AUS$474m during 2015, up from AUS$27m ten years ago.

• Pret a Manger’s director of food, Caroline Cromar, says the coffee chain is trialling new delivery models with Deliveroo and Uber Eats. Cromar added. ‘The landscape is definitely changing—it’s not our traditional rivals like Marks & Spencer but street food and disruptive delivery.’

• Australian Vintage has issued a second profit warning as a result of the decline in the value of sterling, from AUS$7.2m to AUS$3m. The group said in a statement that ‘Every global wine company that sells wine to the UK has experienced similar falls with the GBP declining between 18% and 34% against the various currencies,’ adding: ‘The UK remains a very tough market and we expect conditions to remain challenging for at least the next 12 months.’

• September Peach Coffer Tracker has overall LfL sales +1.8% in the month, casual diners +2.2%, pubs +1.6%

• Tracker: Better performance from casual diners to be welcomed. Pubs up against Rugby World Cup comps last year. Would otherwise have been helped by the fact that the hottest day of the year this year was 13 September

• Tracker says ‘consumer spending on eating and drinking out continues to hold up post Brexit vote’. CGA Peach’s Peter Martin adds ‘it’s the third month in a row following the EU referendum that that sector has recorded positive growth, suggesting that consumer confidence remains upbeat following a sluggish start to the year.’ Martin continues ‘branded restaurant groups performed slightly better than managed pubs, with like-for-likes ahead 2.2%, against a 1.6% increase for the month for pub groups. This reverses the trend of July and August, which saw casual dining slightly down on 2015. However, the pub numbers can still be seen as good as the Rugby World Cup kicked off in mid-September last year, which helped boost the drinking out market.’

• Tracker remains upbeat. Says ‘the good weather will have helped trade this September, but the underlying trend for the market as a whole has been upwards right across the summer, so operators can take some heart from the fact that the public doesn’t appear to have cut back on going out despite the continuing longer-term economic uncertainty around Brexit.’

• Tracker has provinces performing more strongly than London in September. London +0.9% LfL but provinces +2.2%.

• Something of a trend emerging in house prices, consumer confidence, hotel occupancy & F&B spend with provinces outperforming London

• Tracker: New capacity still an issue. Total sales across contributing companies +5.0% but LfL sales just +1.8%

• Tracker: Year on year sales for the last 12mths running at +0.7%. Sluggish start to 2016 but better trading recently. Coffer Corporate Leisure reports ‘the hospitality sector continues to show growth post Brexit. Like-for-like sales are broadly in line with the recently released inflation numbers. Hospitality is often a bellwether of confidence and these figures show the continued resilience of UK consumers. However, the news this week that inflation has hit the highest levels for two years, plus rising import and fuel costs, could well mean that we start to see a dip in consumer confidence levels and reduced spend on eating-out as cost increases start to get passed on to customers.’

• Overall hospitality spend seen as ‘resilient’ post Brexit ‘despite plenty of doom-mongering predictions’ says RSM UK. It goes on to say ‘while wider retail is suffering, we believe the leisure and hospitality sector will prosper as consumers continue to divert discretionary spending into more regular bar and restaurant experiences given how embedded they have become to the UK social calendar’.

• Wilson Drinks Report suggests champagne prices could rise by around £3 per bottle. It says ‘the effective increase in the cost of wines imported from Europe into the UK market arising from the fall in the value of the Pound has put significant pressure on producer/distributor margins.’ The WDR goes on ‘interestingly, the impact of the fall in the Pound is significantly reduced if producers focus instead on trying to maintain their cash margin and not their gross margin %. In this case, Champagne would only need to increase by £2.30 not £3.06 for the same 15% decrease in the value of the Pound.’

• Wine prices could go up by an average of 29p per bottle and the cost of importing wine could increase by £225m a year inside the EU as a result of the falling pound. The figures come from the Wine and Spirit Trade Association, which said the industry is now bracing itself for a financial hit as 99% of the 1.8bn bottles of wine drunk in the UK are imported. Miles Beale, chief executive of the WSTA, commented: ‘[Price increases are] of grave concern to the wine industry and it is vital that Government come out in support of the trade which generates £17.3bn in economic activity.’

• SSP announces it has entered the Indian travel food and beverage market, creating a joint venture with K Hospitality Group

• SSP says it has agreed to create a joint venture, whereby SSP will own a 49% stake in Travel Food Services Private Limited (“TFS”), a leading operator of food and beverage concessions in travel locations in India. It adds ‘TFS operates food and beverage outlets in travel locations, with approximately 170 units in India including at six major airports in both domestic and international terminals and in railway stations. It also runs a number of airport lounges. In addition to these contracts, it operates food and beverage outlets at Muscat Airport in Oman. Its brand portfolio includes a number of strong in-house concepts as well as leading third party brands such as KFC, Krispy Kreme, Pizza Hut and Coffee Bean and Tea Leaf.’

• SSP is acquiring 49% of TFS for an expected net4 consideration of £57.9m. It reports ‘the acquisition will take place in two stages. The first stage is to acquire a 33% stake for an estimated net consideration of £39.0 million. This stage is expected to be fully completed by the end of February 2017. The second stage, to acquire a further 16%, is expected to take place by the end of 2018, for a net consideration of approximately £18.9 million, contingent upon the performance of the business.’ SSP says ‘the consideration will be satisfied out of existing debt facilities. The transaction is expected to be earnings enhancing in the first full year of operation and to exceed SSP’s cost of capital by the third full year following the first stage of the acquisition.’ CEO Kate Swann reports ‘this partnership is in line with the strategy we set out at our IPO. We have been looking for the right entry point into this exciting growth market and are delighted to have found an excellent partner in TFS. TFS brings a well-established business with a strong portfolio of brands. The combination of SSP’s international expertise in the travel sector and TFS’ strong local presence will provide an excellent platform for future growth in the Indian market.’

• US chain MOD Pizza will open its third UK restaurant in Gateshead on 10 November after securing a site at the intu Metrocentre shopping centre. The ‘build your own’ pizzeria was set up by Seattle Coffee Company founder Scott Svenson and now has 130 sites in the US. Its UK roll-out is part of a joint venture with Carphone Warehouse founder Sir Charles Dunstone, who also backs Five Guys in the UK.

• The New World Trading Company has seen adjusted profits jump by 63% to £3.5m and sales soar by 70% to £30.1m across its 15 pub-restaurants in the year to 31 March 2016. The fast-growing group has expanded its portfolio of sites across the country, with its seven openings in the year comprising four Botanists, two Trading Houses in London and Glasgow, and a new concept called The Club House in Liverpool. The Graphite Capital-owned group continues to be led by long-standing CEO Chris Hill and has upcoming openings in Sheffield and York.

• Greene King’s September Leisure Spend Tracker highlights the importance of Halloween as a night out, with 23% of 25-34 year-olds and 31% of 18-24 year-olds celebrating the event every year. Over half of respondents said it is important for local pubs to engage with seasonal events and two-thirds of Brits said they will see their Halloween spending stay the same or increase this year. The BBC has referred to the growing popularity of the holiday, fuelled mainly by younger generations, as ‘Halloween-flation’.

• The BBPA has welcomed the government’s UK Food and Drink International Action Plan 2016-2020, which is designed to boost UK export growth. The plan has been drafted by the government in collaboration with various trade bodies and revolves around three objectives: encouraging non-exporters to try exporting and to get current exporters to grow their targets; increasing companies’ capability to do so by raising productivity and skills in the sector; and identifying opportunities by building volume and trade opportunities in key markets.

• Brigid Simmonds, Chief Executive, British Beer & Pub Association, comments: ‘There is a tremendous appetite for British beer across the world, which seems to grow every year, with great quality and strong diversity from our brewers. The challenges of Brexit will be felt in the coming years, however, and it is vital that the UK seizes every opportunity to increase exports, with tariff-free access to EU markets, and no red tape for exporters, helping the UK food and drink industry to continue to build on their existing export success.’

• Coaching Inn Group has increased its group EBITDA to just over £1m on the back of a 5.8% like-for-like increase in sales.

• Wagamama has opened its first site in Jeddah, Saudi Arabia, after successful openings in Bahrain, the UAE, and Qatar.

• Travis Perkins, the UK’s biggest builders’ merchant, is closing 30 branches, putting 600 jobs at risk, due to an ‘uncertain UK outlook’ for next year. Profits at Travis Perkins are expected to be lower this year as a result of weak sales in its plumbing and heating division, where like-for-likes were down 4.1%, and the group is also making ‘further efficiency driven changes in the supply chain, resulting in an exceptional charge of £40-50m this year’.

No evidence MUP (minimum unit pricing) will deliver on objectives

ALMR

No evidence MUP will deliver on objectives

The ALMR has voiced concerns about the Scottish Government’s decision to introduce minimum unit pricing for alcohol, despite no evidence that it will deliver on its objectives.

Scotland’s Court of Session has this morning given the Scottish Government approval to introduce the measure.

ALMR Chief Executive Kate Nicholls said: “The ALMR has echoed the UK Government’s sentiments that any introduction of minimum unit pricing must be evidence-based and provide certainty that it will deliver on addressing alcohol-related harms.

“The Scottish Government has introduced MUP without providing conclusive evidence that the policy will lead to a reduction in consumption of alcohol and a reduction in alcohol-related harms, which ultimately is its aim.

“Pubs and bars in Scotland will now face an increase in costs without any reassurance that this additional financial burden will be effective in addressing the Scottish Government’s objectives.

“The ALMR has repeatedly pointed to falling levels of alcohol consumption and a shift in drinking habits which favours unsupervised drinking of off-trade alcohol that can be bought very cheaply. This year we have seen beer sales in the off-trade overtake beer sales in the on-trade and yet pubs and bars will still be forced to bear this indiscriminate financial burden and additional, unnecessary level of bureaucracy.

Pub Governing Body press notice

ALMR

Pub Governing Body press notice – from the ALMR 17.10.2016

Annual audit highlights continued importance of PGB 

The Pub Governing Body has published its third annual audit of pub companies holding in excess of 100 pub leasehold agreements in England and Wales.

 

This year’s report shows continued engagement by pub companies with the PGB and a welcome boost in the number of BDMs completing training, increasing from 63% in 2015 to 86% in 2016. The report also shows the number of rent reviews completed within 12 months falling to 60%, although this could be explained by the changes in the market where pubs are being sold or converted from leases into tenancy agreements or managed houses.

 

In total, there were 21 referrals to the Pubs Independent Rent Review Scheme (PIRRS) regarding rentals and one lease renewal. There were 27 enquiries to the Pubs Independent Conciliation and Arbitration Service (PICAS) from tenants.

 

The PGB will continue to oversee the code of practice for those pub companies not meeting the 500 outlet threshold for the Statutory Code.

 

Sir Peter Luff, Chairman of the Pub Governing Body said: “The results of this year’s annual report underlines the crucial role the Pub Governing Body continues to play following the implementation of the Statutory Code for Pubs.

 

“Two years ago we raised concerns around the issue of BDM training and it is very encouraging to see a considerable boost in the number of BDMs completing training.

“It has also been encouraging to see lessees continue to engage with PIRRS and PICAS and an increase in the number of resolved complaints within the set timescale to 70%, closer to the 2014 high of 74.9%. PIRRS and PICAS represent a convenient, cost-effective method is dispute resolution for licensees and the PGB continues to play an active and valuable part in the self-regulation of the sector.”

JG&Partners, October licensing further update

JG & Partners

 

JG&Partners, October licensing further update

Scotland – Minimum Pricing – Court of Session decision

The long running saga over the Scottish Governments intention to introduce a minimum unit price for alcohol of 50p (opposed by the Scotch Whisky Association) may finally be drawing to a close. In December 2015, the European Court of Justices (ECJ) ruling was referred back to Scotland’s Court of Session for a  decision and further details of the ECJ…

Gambling – LCCP changes coming into force 31st October 2016

On 31st October 2016 further amendments to the Licence conditions and codes of practice (LCCP) issued by the Gambling Commission will come into force. The LCCP is a universal document covering the entire spectrum of licensed gambling businesses. Although some sections may not be applicable to your business you should be familiar with the LCCP and keep abreast of revisions. The chan…

Duty to declare Personal Licence – A reminder

On the 18th October Wrexham.com published an article which highlights the legal requirement for Personal Licence Holders to disclose the existence of their personal licence to a the Court when charged with a relevant offence. Section 128 of Licensing Act 2003 requires a personal licence holder, who is charged with a relevant offence to produce their personal licence to the …

National Minimum Wage Statistics

The National Minimum Wage (NMW) sets minimum hourly rates of pay and those rates (which are based on recommendations of the Low Pay Commission (LPC)) vary by age group. AS previously reported, the introduction of the National Living Wage (NLW) in April 2016, set the NMW rate for adults aged 25 and over at £7.20 an hour. From October 2016 the NMW rate is £6.95 for…

Surprise retirement dinner for John Saunders QC

The great and the good of the legal licensing community (including our own John Gaunt) gathered last night (Thursday, 13 October) to throw a surprise retirement dinner for & formidable licensing advocate John Saunders QC, who will be known  if only by reputation – to many operators. In 2004, John was appointed a full-time circuit judge as well as takin…

Some of the weeks Leisure Industry News

Some of the weeks Leisure Industry News

If you would like to read the latest Industry News and Corporate Activity, please click on the following link     http://www.propelinfonews.com/selecttemp.php, before 9.00 am for yesterdays News, click on the link after 9.00 am for latest Weekday’s News

PUB, RESTAURANT & DRINKS PRODUCERS:

• Punch Taverns has said that it has seen an ‘astounding’ level of attendance at 6 recent nationwide roadshows.

• Next boss Lord Wolfson has said that inflation will be a problem for retailers next year.

• Soho House UK has posted a 24% increase in turnover to £104m for the 53 weeks to 3 January 2016, although new site development costs led to a loss of £6.7m, per Propel.

• Unilever has resolved its pricing dispute with Tesco, adding in a brief statement that it is pleased to move on from the ‘supply situation’.

• Pho has just completed a two-week campaign on Snapchat to better target the student population.

• Whitbread has appointed Deanna Oppenheimer and David Atkins as non-executive directors from 1 January 2017. The pair will replace Wendy Becker and Stephen Williams, who are stepping down in the coming months after nine years’ service.

• The Gipsy Queen in Kentish Town, known for its famous clientele, is available on Fleurets as a free-of-tie leasehold with a guide price of £150,000. Elysia Wilson-Gunn, Associate at Fleurets commented: ‘This property is charming both internally and externally, however it also possesses a two double bedroomed manager’s flat as well as a substantial beer garden.’

• Village pubs are still in great demand for pub use, at least across Gloucestershire and Oxfordshire, according to a Fleurets report. The surveyors found that the majority of pubs sold across this region continue to be used as pubs, and have been sold for between £200,000-£450,000, including pubs such as The Inn at Greatworth and The Red Lion in Bloxham. While the latter’s status as an Asset of Community Value did put off developers, the pub was purchased by existing village operators and refurbished to a high standard.

• Chris Irving, Divisional Director from Fleurets, commented: ‘I have been involved in marketing pubs for over 25 years and it is very pleasing to see the return of confidence for purchasers looking for character village pubs which often offer not only great trading prospects, but a pleasant environment to live. A number of parties needed to raise funding for a percentage of the purchase price or to undertake full refurbishment programmes. It is great to see these investments, which not only make the pub a continued success but also keep villages vibrant.’

• Fuller’s has teamed up with Spanish premium lager Cervezas Alhambra to distribute the latter’s portfolio across the UK. Cervezas Alhambra’s products include Reserva 1925 and Especial, which have won numerous awards. Cervezas Alhambra Area Director, Santiago Fernandez Soriano commented: ‘The UK market is the leading territory outside of mainland Spain and we want to maximise the opportunity for consumers to choose our products. The on and off trade channels are an essential part of our strategy, and we were keen to support our growth ambitions in these areas.

• ‘Fuller’s has an extensive distribution network and field resource. Our partnership with Cervezas Alhambra will enable us to provide increased and focused support to our trade customers and to jointly develop plans that drive sales within the Spanish beer category.’

• Braspear will open its ninth managed pub at the end of November, the Retreat in Staines, formerly called the Anglers Retreat, following a major refurbishment.

• Giraffe Concepts, part of Harry Ramsden’s owner Boparan Restaurants Holdings, has acquired Ed’s Easy Diner. This consists of the brand, the head office team, and 33 Ed’s restaurants.

• Vianet updates on H1 trading, says trading ‘was ahead of same period last year, achieving good growth in line with Board’s expectations.’

• Vianet says following ‘good growth’, it will declare a maintained H1 dividend of 1.7 pence per share. Group says ‘the Group’s UK core beer flow monitoring operations, including iDraught, has continued to strengthen its market position and maintained its contribution, and encouragingly there are signs that the rate of pub closures in the sector has slowed down.’

• Vianet chairman James Dickson reports ‘we have continued to make good commercial progress by delivering highly relevant solutions that drive strong returns for our customers.’

• Booker has released its interim results for the 24 weeks to 9 September, during which total sales grew by 13% to £2.5bn but like-for-like non-tobacco sales only rose by 0.1%. Profit before tax for the wholesaler grew by 9% to £81m, driving an 11% increase in basic EPS to 3.83p and an identical increase in interim dividend to 0.63p a share. Booker retains its strong balance sheet, with a net cash position of £105.7m. The integration of Londis and Budgens is going well, while its online and India businesses continue to grow well.

• The wholesaler says of its current trading that: ‘the first four weeks of the current half year is ahead of the same period last year,’ although it anticipates the ‘challenging consumer and market environment will persist through the coming year and the UK’s food market remains very competitive’.

• Japanese brewer Kirin is to take a 25% stake in Brooklyn Brewery & will take the rights to sell Brooklyn’s beers in Japan. The cost of the purchase has not been disclosed. Craft beers currently account for around 4% of the market in Japan (compared to >12% in the US), but this figure is expected to grow.

• The Resolution Foundation has suggested that wage growth will weaken next year and says rises in the NLW should moderate.

• Resolution Foundation suggests NLW should be £7.50 per hour next year, down from earlier suggestions of £9.60. Resolution told the BBC ‘the National Living Wage relates to average earnings and because of Brexit, many forecasters, including the Bank of England, revised down their earnings growth; therefore the National Living Wage has also been revised down.’

• E-Cigs are now the biggest ‘smoking cessation aid’ in the UK. Yet, as the IEA points out, health authorities worldwide are trying to ban them. The Institute of Economic Affairs reports the European Commission approved a new directive to reclassify e-cigarettes as tobacco products for tax purposes. It says ‘this move, when implemented, will drastically increase the cost of the device and further hinder its take up.’ The IEA maintains that it is hard to see why ‘harm reduction’ should not be central to government & fiscal decisions.

• Tesco has stopped selling a number of Unilever brands after the latter pushed for raised prices post Sterling’s collapse. Tesco has said it was ‘currently experiencing availability issues on a number of Unilever products’.

• Stock Spirits Group has announced the acquisition of three spirits brands from Bohemia Sekt s.r.o for CZK135 million (€5m). The purchase means the brands could be distributed and marketed by Stock Spirits by the end of the month, and is in line with the group’s stated strategy of expanding its portfolio in its target markets through value-enhancing bolt-on acquisitions. Production will be fully integrated into Stock Spirits’ Czech production facilities in Plzeň by January 2017.

• Mirek Stachowicz, Chief Executive of Stock Spirits, said: ‘We are delighted to add Prazska, Nordic Ice and Dynybyl to our line-up, having tracked these brands for some considerable time. They have a rich heritage and, with the appropriate brand investment and nurturing within our wider spirits portfolio, their addition will ensure Stock remains at the forefront of the Czech spirits market, which is so central to our business. As we stressed in our interim results announcement, we will continue to pursue further smaller bolt-on acquisitions to add to our brands line-up.’

• A CGA Strategy survey suggests consumers will spend as much as 24% more on a cocktail that has been served properly and to a high standard. Speaking at the recent Morning Advertiser’s Future Trends: Spirits event last week, CGA Strategy director of client services Rachel Perryman said: ‘According to our research, 46% of consumers drink spirits in the on-trade and they will spend 24% more when the quality of the serve is right. This shows there’s definitely an opportunity for more growth in spirits in the on-trade and that’s about operators creating something that’s more appealing to customers.’

• Giggling Squid sales grew by 55% year-on-year to £11.8m in its most recent year and is expecting to grow from 17 sites to 25 by halfway through 2017, writes Propel.

• Free drink app Hooch has raised $1.5m to expand its drink a day subscription cocktail app, which entitles users to one free drink a day in different bars for $9.99 a month.

• Game Digital has announced a 5.1% fall in like-for-like sales to £822.5m for the 53 weeks to 30 July 2016, while profit before tax dropped by 81% to £4.9m. Adjusted (basic) earnings per share tumbled by 52.4% to just 8.9p as the video game retailer struggled in a ‘challenging UK console market’. The group has a ‘cautious outlook’ on current trading and expects adjusted FY16/17 EBITDA to be ‘broadly’ level with the current year ‘before the financial impact of its planned new live gaming activities’.

• Martyn Gibbs, Chief Executive Officer, said: ‘Market dynamics in the UK have undoubtedly been tough in the past year. The management team responded quickly to these new market conditions and have made significant progress with its action plan since January,’ but admitted the group recognises ‘that we need to continue to reposition and transform the business.’

• Although the results put Game Digital on a modest PE of 7.8 times at 70p, this is down from 230p at the start of the year, and the group still has a lot to do before it can tempt gamers to come shop in its stores rather than on the digital platforms set up by respective consoles and PC (Steam, Playstation Store et al.).

• Domino’s Pizza Group says it ‘continued to trade well’ in its third quarter, although its like-for-like system sales growth fell across its markets amid ‘tough comparators’. UK system sales LfL growth declined from 14.9% in the same period last year to 3.9% for a total of £220.9m, while ROI system sales growth fell from 14.1% to 7.6% for a total of €14.9m, and Switzerland fell from 5.3% to no growth and CHF 4.8m. The group’s total year-to-date performance is up by 11.5% versus 15.2% in the prior year.

• Domino’s Pizza Group currently has 920 stores in the UK and 34 of its 51 openings so far this year have been generated by splitting its trading areas between units. Commenting on the results and outlook, chief executive officer David Wild, said: ‘The business continues to trade well with a strong sales uplift across the Group during the period.  As highlighted at our interim results in July, we face tough comparatives in the second half of the year, but our continued investment in e-commerce, our international expansion and the launch of our new Italiano range taking us to new customers, will help to drive performance for the remainder of the year.  Our new store programme provides a strong platform for future growth.’

• Barclaycard data suggests consumer spending exceeded expectations in the wake of the EU referendum result

• Barclaycard reports spending rose by 3.6% y-o-y during the warmer weather in Q3 this year versus last

• Barclaycard says consumer spending +2.6% in July but +4.2% in the months of August and September. Barclaycard reports ‘this recovery in confidence, combined with the warmer September weather, helped to prolong the summer feeling amongst consumers last month.’ It continues ‘increased spend on experiences, and in particular with friends and family in pubs and restaurants, delivered one of the strongest months for spend growth so far this year.’

• AB InBev has completed the divestiture of SABMiller’s Peroni, Grolsch, and Meantime brands.

• Ask and Zizzi operator Azzurri has bought the former Monikers site in Hoxton Square for the first site of its new fast-casual pizza concept, Radio Alice.

• iNTERTAIN has launched a new employee engagement app called Pulse, which is designed to allow staff to share best practice in the workplace.

• UK food and drink manufacturers express concern over increased ingredient prices and lower margins in a survey conducted by Food and Drink Federation (FDF). This news comes alongside the highest quarterly results for UK retailers in food sales since 2013.

• YUM Brands has updates shareholders at a capital markets day saying ‘our mission is to build the world’s most loved, trusted and fastest-growing restaurant brands.’

• YUM to focus more on a franchised model. The group has told shareholders ‘partnering with growth-minded franchisees, Yum! Brands will increase franchise restaurant ownership from 77% currently to 93% at the time of the separation of the China business to at least 98% by fiscal year ending 2018, with a focus on equipping and recruiting the best restaurant operators in the world to deliver great customer experiences and drive brand growth.’

• YUM will use its China separation as a catalyst to drive change and growth. Execution will be an issue but CEO Greg Creed maintains ‘the separation of our China business provided a once-in-a-lifetime opportunity to review our operating model and consider all possibilities available under our new structure. The transformed Yum! Brands will maintain its geographic diversity with continued, meaningful exposure to the growth potential of the world’s largest consumer market, China.’

• YUM outlines that its China business will become a licensee of Yum! Brands in Mainland China.’ The company says ‘Yum China will have exclusive rights to KFC, China’s leading quick-service restaurant concept, Pizza Hut, the leading casual dining brand, and Taco Bell, which is expanding globally but is not yet in China.’ China boss Micky Pant says ‘Yum China is a powerhouse business that will be one of China’s largest publicly traded retail companies.’ He adds ‘with our unique market position and a rapidly growing middle class and urban population, we believe that we offer an unrivalled opportunity for sustained long-term growth in China.’ The separation is currently expected to occur after the close of business on October 31, 2016.

• YUM has said that it expects to return up to $13.5bn to shareholders by 2019.

• Nearly 100,000 businesses who had to implement the National Living Wage six months ago in April 2016 are now in a state of financial distress. New research from insolvency firm Begbies Traynor shows that 97,342 businesses were experiencing financial difficulties on 1 October in affected industries, marking a 23% increase on the number of firms struggling six months ago.

• This number includes 33,835 retailers, 13,772 wholesale outlets, 13,071 transportation and logistics firms, 10,809 bar and restaurants, 10,019 food and drug retailers, 7,803 food and beverage retailers, 5,406 sports, and health clubs and 3,347 hotels. The situation for these firms is only set to intensify as the government moves towards its target of £9 an hour by 2020.

• Premier Foods has warned that warm weather in September has hit grocery sales numbers. It says, however, that ‘the Group’s profit expectations for the full year remain unchanged due to the careful management of costs.’

LEISURE TRAVEL & HOTELS:

• Elegant Hotels updates on trading for full year, says results will be in line with market expectations.

• Elegant Hotels says uncertainty means bookings are running behind the same period last year. Group says it ‘is only 14 days into its new financial year and, whilst it appears UK consumer confidence is returning, the political uncertainties in the UK over the summer months are, it believes, responsible for bookings for the current financial year tracking slightly behind the same period last year.’ The group adds ‘given these recent booking trends, the Board believes it is prudent to have a cautious outlook, with Group revenue for the current year currently expected to be broadly flat in comparison with FY16.’ CEO Sunil Chatrani reports ‘while the underlying market conditions of the last few months have undoubtedly been challenging, we are delighted to have successfully launched Waves Hotel and Spa, our first acquisition since IPO, and are looking forward to finalising the management contract for our first hotel outside Barbados. Barbados remains a beautiful place to visit, and we continue to be extremely fortunate to have a peaceful, politically stable and exceptionally tourist-friendly island on which to provide a high quality luxury offering to our guests. As a result, and notwithstanding the immediate headwinds that we face, we remain confident in the long term growth prospects for Elegant Hotels.’

• The US hotel industry’s occupancy fell once more in the week to 8 October, down 1% to 70.9%, as RevPAR was propped up by average daily rate increases. Among the Top 25 Markets, San Francisco/San Mateo, California, posted the largest year-over-year performance increases in ADR (+25.9% to US$326.74) and RevPAR (+22.3% to US$296.86). Occupancy in the market was down 2.8% to 90.9%.

• The BHA has said that London hotels are struggling to attract their fair share of Chinese visitors. The BHA says operators need to be more pro-active. It says ‘London is the greatest city in the world but it’s lagging behind its European neighbours in terms of attracting Chinese tourists and it’s time to take action.’ The BHA continues ‘hoteliers want to capitalise on what is likely to be a much more mature market in five or ten years’ time, but we need to be proactive today.’

• The UK Brexit vote has had ‘no impact’ on bookings, according to Thomas Cook UK managing director Chris Mottershead, but terrorist attacks have ‘changed the industry’. Mottorshead added that ‘bookings are strong for future seasons,’ and downplayed the current impact of the falling sterling, explaining at the Travel Convention in Abu Dhabi that ‘the impact of the exchange rate will be [felt] more down the road.’

• Consumer confidence in holiday bookings has not been rocked by the UK’s vote to leave the EU, according to PwC partner David Trunkfield.

• Consumer confidence in holiday bookings have not been blown off course by the Brexit vote. The main holiday continues to be the second most important spending priority after grocery shopping and above savings and investments and home improvements, according to PwC research released at the convention in Abu Dhabi.

• Monarch managing director Andrew Swaffield came out at the recent Abu Dhabi Travel Convention to ‘thank the trade for supporting Monarch’.

• The long-awaited decision on airport expansion could be made as early as next Tuesday.

• Greybull has put £165m into Monarch Airlines easing recent fears over the group’s finances. Andrew Swaffield, chief executive officer of The Monarch Group, said: ‘It is testament to the extensive effort by all parties, over the past weeks and months, that we are able to announce the largest investment in our 48-year history, as well as the renewal of our Atol licences. I’d like to thank the CAA, our shareholders, partners, loyal customers and the team at Monarch for helping us to achieve this successful outcome. We are now firmly focused on the future as a stronger Monarch.’

• Abta chief executive Mark Tanzer has warned against ‘complacency in government’ over Britain’s exit from the EU and related threats to free movement. Speaking at The Travel Convention in Abu Dhabi, Tanzer cautioned: ‘Economic interconnectedness continues to grow. But I want to warn against any complacency. Even before the Brexit referendum we were seeing barriers to migration rising. The IMF warned last week of a rising tide of protectionism.

• ‘The prime minister returned to a very traditional philosophy at the Conservative Party conference last week, [saying] that if you feel a citizen of the world you are a citizen of nowhere. I disagree with her. We’ve seen rising animosity to immigrants. [But] travel needs open borders – for visitors and for workers. We will be arguing for a [Brexit] solution that meets the needs of the industry.

• ‘Our priorities are open skies and free movement of people, and they are tied together. You can’t separate them and we’ll try to make the government realise that.’

• UK China flight numbers set to double with flights rising from 40 per week to 100. Cargo services will be unlimited. Transport secretary Chris Grayling said ‘this deal is a big moment for the UK. Strong connections with emerging markets like China are vital for us if we are to continue competing on the global economic stage. Hundreds of thousands of Chinese people visit the UK every year, spending hundreds of millions of pounds. Raising the number of permitted flights between the 2 countries will provide massive opportunities for our businesses, helping increase trade, create jobs and boost our economy up and down the country.’

• STR has reported that the number of hotel rooms in the process of being built in the Asia Pacific region stands at c582,000

• Christie & Co research shows that London RevPAR is down 2.3% year-to-August 2016 due to faltering occupancy levels as a result of supply side pressures. Approximately 8,500 additional rooms have come online between 2014and Q2 2016. The regional market remains more buoyant, however, with cities like Edinburgh, York, and Brighton helping to drive 3% RevPAR growth.

• STR’s September 2016 Pipeline Report shows 152,705 rooms in 1,016 projects Under Contract in Europe, up 17.5% year-on-year. Meanwhile, there were 549,142 rooms in 4,510 projects Under Contract in the United States, marking a 24.4% year-on-year rise.

• Thomas Cook’s UK and Ireland managing director market disruptors like Airbnb will become regulated as customers demand ‘safety and security’. Speaking at the Abta Travel Convention 2016, Chris Mottershead commented: ‘What happens with companies like Airbnb is they become regulated. If you want the very best experience on your holiday you want someone to make sure it’s safe and secure. You’re not going to take a chance. There are pros and cons for everyone but it’s ultimately about that holiday experience.

• ‘As your business grows and becomes more established and get noticed people start to look more closely at your model. Technology changes and moves on, but for me that’s not what’s important, that’s just access to the customer. Our 800 shops are in demand which shows people still want that personal service.’

• James Villas is to give agents access to its portfolio of nearly 3,000 properties by selling through the trade for the first time.

• FairFX research shows some airports are now offering as little as 0.88 Euro cents to the pound, while the US dollar is nearly at parity. This means airport providers are charging travellers as much as 26% commission.

• A consumer survey indicates that booking holidays via mobile phone is less popular now than it was a year ago and the PC remains the most widely used method.

• Abta has reported a rise in high street and package bookings in its Holiday Habits Report 2016, with 19% of travellers booking in-store over the past year vs. 17% in 2015. The report, which is based on the Abta Consumer Trends survey, found that the most affluent households and younger people were found to be the most likely to book in-store, with 35% and 29% opting to do so respectively.

• Airbnb alternatives Wimdu (300,000 apartments) and 9flats (250,000 apartments) have teamed up, although the financial terms of the deal have not been disclosed.

• Travel management firm Travel Counsellors has posted a 14% increase in international sales and a 12% rise in UK sales year-on-year for September.

• Profits fell by more than 11% at hotels close to Heathrow in August as airport passenger numbers slowed, according to HotStats. More holidaymakers decided to take a domestic break in August. An increase of 2.8% in average room rate to £68.59 was not enough to offset the 5.8% decline in occupancy during August, as revenue per available room fell 3.9% to £57.32.

FINANCE & MARKETS:

• The US Labour Department has been able to report that initial claims for unemployment benefit were at a 43yr low last week

• The SNP is to prepare the ground for a second referendum on Scotland’s membership of the UK. The Scots voted in June to remain within the EU. SNP boss Nicola Sturgeon comments ‘I am determined that Scotland will have the ability to reconsider the question of independence and to do so before the UK leaves the EU – if that is necessary to protect our country’s interests.’ She continues ‘so, I can confirm today that the Independence Referendum Bill will be published for consultation next week.’

• There are now more US dollar billionaires in China than there are in the USA.

• World markets: UK & Europe down yesterday, US also lower. Far East markets better in Friday trading

• Oil off a little further at around $52 per barrel for Brent Crude.

• Sterling bounced a little yesterday. Falling as we write but trading around $1.223 per US dollar

• Tom Scholar, permanent secretary at the Treasury, has said that The City will be a high priority in talks re EU exit. Mr Scholar comments ‘the UK economy and UK exports are quite services-heavy, and financial services are an important part of that. So I think we will be very keen indeed to make sure the final agreement gives the proper place to financial services within that.’ He adds ‘so it will have a high priority in our discussions.’

• Minutes from the latest Fed meeting (Sept) show that the decision to hold rates was a ‘close call’. The minutes report ‘several members judged that it would be appropriate to increase the target range for the federal funds rate relatively soon if economic developments unfolded about as expected.’ They continue ‘it was noted that a reasonable argument could be made either for an increase at this meeting or for waiting for some additional information on the labour market and inflation’.

• The Royal Institution of Chartered Surveyors has said that house buying demand is recovering from its “post-referendum jitters”. The RICS says ‘the market does now appear to be settling down following the significant headwinds encountered through the spring and summer. Buyers do appear to be returning, albeit relatively slowly, but the big issue that continues to be highlighted by respondents is the lack of fresh stock on the market.’

• World markets: UK & Europe down yesterday but US higher. Far East down in Thursday trading

• Oil off a little. Brent Crude now around $51.50 per barrel.

• Sterling off again, trading at around $1.2179 per Pound. Was around $1.46 pre the Brexit referendum. Petrol prices to rise perhaps this week

• 10yr gilt yields have passed 1% for the first time since the Brexit vote as Sterling has continued its fall

• BBC says FTSE100 near its highs on better export prospects. Would that 10% of the economy could power the whole. It’s just translation.

• Crude oil prices stronger on back of Vladimir Putin’s support of OPEC’s production cap plan. Oil price now +135% in Sterling terms.

• Bank of England’s Michael Saunders suggests ‘given the scale and persistence of the UK’s current account deficit, I would not be surprised if sterling falls further, but I am fairly agnostic as to whether any further depreciation is likely.’

• Alcoa disappointed in the US overnight. Seen as a bellwether, poor numbers suggest there may be something in the suggestion that corporate earnings may struggle to match expectations thereof

• World markets: UK mixed with FTSE100 down on oil worries. Europe down, US down and Far East down in Weds trade

• Oil price edging back. Brent crude $52.60.

• Sterling hitting new lows. Below 123c per pound vs dollar.

YESTERDAY IN A NUTSHELL – SELECTION OF TWEETS, LIVE TWEETS ON WEBSITE:

• Giraffe Concepts, part of Harry Ramsden’s owner Boparan Restaurants Holdings, has acquired Ed’s Easy Diner

• Vianet updates on H1 trading, says trading ‘was ahead of same period last year, achieving good growth in line with Board’s expectations.’

• Game Digital has announced a 5.1% fall in like-for-like sales to £822.5m for the 53 weeks to 30 July 2016

• Japanese brewer Kirin is to take a 25% stake in Brooklyn Brewery & will take the rights to sell Brooklyn’s beers in Japan

• Resolution Foundation has suggested that wage growth will weaken next year and says rises in the NLW should moderate.

• E-Cigs are now biggest ‘smoking cessation aid’ in the UK. Yet, as the IEA points out, health authorities worldwide are trying to ban them

• Tesco has stopped selling a number of Unilever brands after the latter pushed for raised prices post Sterling’s collapse

• CGA Strategy survey suggests consumers will spend 24% more on a cocktail that has been served properly and to a high standard

• Greybull has put £165m into Monarch Airlines easing recent fears over the group’s finances

• UK China flight numbers set to double with flights rising from 40 per week to 100. Cargo services will be unlimited

• Christie & Co says London RevPAR down 2.3% year-to-August 2016 due to faltering occupancy levels as a result of supply side pressures

• Thomas Cook’s UK & Ireland managing director market disruptors like Airbnb will become regulated as customers demand ‘safety and security’

• Other tweets: Sugar +63% over 12mths in US$ terms. In Sterling, it’s +97%. Oil +135%. Hog prices down 19% in US$ but unchanged in Sterling

• Orange Juice +80% in Sterling, one Euro costing £1.13 in some airports. Distortions already becoming apparent, inflation likely to follow

• Tesco Unilever spat won’t be the last. International operators will want to earn same in $$s or €€s. That means higher Sterling prices

• Odds on Dec rate rise Stateside still 65%. US$ weakness not likely unless that changes. Sterling still at lows

• WH Smith. Not being funny but just remind me, what’s the raison d’etre? Ditto Game Digital. If they didn’t exist, would you invent them?

• Defunct business models. Look what happened to Blockbuster. Somebody was buying those shares till the day it keeled over

• Ed’s. A lesson in non-success (a.k.a. failure). Still, Boparan prob. getting 35 sets of loos, kitchens, furniture, F&E etc. for <£0.5m each

• Monarch. Brinkmanship or good money after bad? Betting probably on the former. No drop in capacity. Was the expected outcome

• Marston’s Q4 update. Trading in line, forecasts secure, LfLs all positive, 22 new pubs & 6 lodges this year. PER <10x.

• MARS Premium & Destination +2.3% LfL, Taverns’ +2.7%, LfL EBITDA from leased pubs is +2% on last year, brewing +13%

• CEO Ralph Findlay comments ‘Marston’s has delivered another year of solid progress with underlying growth across all of our pub divisions’

• Barclaycard data suggests consumer spending exceeded expectations in the wake of the EU referendum result

• Barclaycard says consumer spending +2.6% in July but +4.2% in the months of August and September

• YUM outlines that its China business will become a licensee of Yum! Brands in Mainland China.’

• Premier Foods has warned that warm weather in September has hit grocery sales numbers

• A consumer survey indicates that booking holidays via mobile phone is less popular now than it was a year ago

• 10yr gilt yields have passed 1% for the first time since the Brexit vote as Sterling has continued its fall

• Bellwether Alcoa disappointed in US overnight. Poor numbers. Could be something in suggestion that corporate earnings may struggle

• Domino’s Pizza Group says it ‘continued to trade well’ in Q3, although LfL system sales growth fell across its markets amid ‘tough comps’

• Businesses will not now have to publish how many foreign workers they employ. That policy didn’t last long. Clarity still gone missing

• BBPA sets out manifesto for Britain’s exit from the EU, with policies including a focus on free trade and attracting and retaining overseas skills

• UK retail sales returned to growth in September thanks to higher spending on food, more purchases on big-ticket items

• Motoring organisations are suggesting that petrol prices will have to rise by 5p this month. Further rises may follow

• Domestic visitors to the UK spend £19.7bn in record growth last year, while China entered the top 10 most valuable markets, reports VisitBritain.

• Peel Hotels reports H1 numbers, sales +1.8% at £9.1m, PBT +19.2% at £592k. REVPAR +2.9% with occupancy down 2.3%

• Monarch is thought to be close to agreeing a revised aircraft order with Boeing that could help secure the airline’s future

• Pure Gym has cancelled its IPO per Sky News citing challenging IPO market conditions. The company declined to comment further

• Times points out Wm Hill potential merger partner was recently fined $870m and its former CEO is being investigated over insider trading

• Other Tweets: Sterling at 30yr lows. Stuck recordsville Arizona. Nonetheless worth noting some airports now offering 88c for the Euro to the Pound

• Markets going up? Headlines true but misleading. Foreign companies (STAN, miners etc.) going up & domestics (builders, REITs etc.) falling

• BCC looking for 1% growth next year. Deloitte says CFOs focusing on cost cutting to hit targets rather than growth

• BRC says retailers making more concerted effort to pass on price rises. Why should they be stuck holding the baby, right? Any volunteers?

• Inflation in the offing? Low margin operators will be in direr need of passing on price rises. Fat margin operators a bit more sanguine?

Pubs Code Adjudicator issues reminder on the responsibilities of pub companies

Pubs Code Adjudicator issues reminder on the responsibilities of pub companies

Paul Newby reminds pub companies what is expected of them in relation to the operation of the Pubs Code.

Since the Pubs Code came into force on 21 July, the office of the Pubs Code Adjudicator (PCA) has received numerous enquiries, complaints and requests for information from tenants. It has also received its first referrals for arbitration.

The Pubs Code Adjudicator is reminding pub companies that they should not act to shorten the time tenants have to enforce their rights under the code and all relevant information, required by the Pubs Code, relating to rent assessments or proposals for tenancies must be made available. This includes information related to a new tenancy and where there is an offer of a market rent only (MRO) agreement. In addition, pub companies must give reasons if refusing or disputing a notice service or a request for information made by the tied tenant.

Profit and loss statements provided alongside rent proposals or rent assessment proposals must be sufficiently clear and detailed. They should also include justification or supporting evidence for any assumptions made, so that the tenant can understand how estimated figures have been calculated.

The obligation is also on pub-owning businesses to ensure that the terms on which MRO tenancies are offered comply fully with the Pubs Code and contain no unreasonable terms and conditions for the tied tenant.

Pubs Code Adjudicator Paul Newby said:

The pub industry should be aware of my expectations as the Pubs Code Adjudicator. I expect pub-owning businesses to act in a manner that does not inhibit a tied tenant from accessing their rights under the Pubs Code, providing all relevant information quickly and clearly.

Open communication is vital to help settle disputes and improve relationships across the industry. In all cases, the principle of fair and lawful dealing requires a pub-owning business to explain its position, so a tied tenant can know the nature of the dispute.

Further information

Read more information about the Pubs Code.

A statutory consultation on the operation of the PCA’s investigation and enforcement powers is open until 30 September 2016.

Tied tenants can contact the PCA by calling the freephone enquiry line on 0800 528 8080 or filling out the online enquiry form.

PAS, the responsibilities of pub companies

PAS, the responsibilities of pub companies

To advise there has been a letter from the PCA office published today, our many representations to the PCA haven’t gone unnoticed and they have been pushed into making a statement, you can read the statement here > https://www.gov.uk/government/news/pubs-code-adjudicator-issues-reminder-on-the-responsibilities-of-pub-companies

We understand that the BIS department also will also be making a statement next week regarding the PCA – again we have been forwarding them as many representations as possible outlining problems with the pubs code and gaming by pubco’s etc

In regards to requests made for books or accounts by your landlords please note if you are asking for the MRO option you do not have to show your books as the MRO is a new lease and therefore not a rent review, as far as we understand most tied agreements state that books can only be requested at rent review and not under a new agreement / renewal. We would urge members to avoid be tricked into handing over books when requesting MRO – if in doubt check your lease or contact us.

In respect of any complaints that you may wish to file with the PCA office for them to arbitrate please note you have to issue a formal notice to your landlord indicating that they have 21 days to comply or you shall go ahead file a complaint with the PCA. The PCA office will reject complaints if you havent given your pubco 21 days notice first, if your Pubco has indicated that they are at deadlock before the 21 days is up then you can proceed to file your complaint earlier. Make sure you show the PCA that you are at deadlock (copies of emails / letter etc)

Apologies for any slowness in responding to individual queries we are working 14 hour days such is the vol of contact re the pubs code and PCA.

Regards
Chris Wright
PAS

Power Solutions, latest News

Procurement                        Efficiency                       Utilities                            Contact

Solar outstrips coal in past six months of UK electricity generation

Adam Vaughan – The Guardian

An estimated 6,964 gigawatt hours were generated by solar over the half-year – 5.4% of the UK’s electricity demand.

Photograph:  Peter Macdiarmid/Getty Images

Electricity generated by solar panels on fields and homes outstripped Britain’s ageing coal power stations over the past six months in a historic first.

Climate change analysts Carbon Brief found more electricity came from the sun than coal from April to the end of September, in a report that highlighted the two technologies’ changing fortunes.

Solar had already eclipsed coal for a day in April and then for the whole month of May, with coal providing zero power for the first time in more than 100 years for several days in May. The latest milestone saw an estimated 6,964 gigawatt hours (GWh) generated by solar over the half-year, or 5.4% of the UK’s electricity demand. Coal produced 6,342GWh, or 4.7%.

Read More

Reduce your energy consumption and costs with the right DC/DA agreement

Getting accurate and timely data of your business energy usage enables us to better procure, monitor, reduce and manage your energy requirements.

What is Data Collection (DC) & Data Aggregation (DA)

The Data Collector (DC) is responsible to carry out Data Collection for half-hourly metering systems. The DC is appointed by the Supplier to retrieve and validate metering data and pass it on to the Data Aggregator.

The Data Aggregator (DA) is responsible to carry out Data Aggregation for half-hourly metering data. The DA is appointed by the Supplier to aggregate consumption from half-hourly Data Collector(s). This data is then validated and passed to the supplier for invoicing.

Read More

Oil investment crashes to 60-year low, incubating next energy shock

Ambrose Evans-Pritchard – The Telegraph

Investment in North Sea oil and gas has collapsed eightfold

 

Oil discoveries have slumped to the lowest level since 1952 and the global economy is becoming dangerously reliant on crude supply from political hotspots, the world’s energy watchdog has warned.

Annual investment in oil and gas projects has fallen from $780bn to $450bn over the last two years in an unprecedented collapse, and there is no sign yet of a recovery next year.

The International Energy Agency said wells are depleting at an average rate of 9pc annually. Drillers are not finding enough oil to replace these barrels, preparing the ground for an oil price spike in the future and raising serious questions about energy security.

“There is evidence that cuts in exploration activities have already resulted in a dramatic decline in new oil discoveries, dropping to levels not seen in the last 60 years,” said the IEA’s World Energy Investment 2016 report.

Read More

Power Solutions appoint new Head of Sales

Exciting times are happening with Power Solutions, and we are very pleased to introduce Ricky Chaplin as our new Head of Sales.

‘I am delighted to join Power Solutions and lead what is already a fantastic TPI into the next era. We have some great plans going forward and will strive to be a market leader in the ever changing and complex energy industry.’  – Ricky Chaplin, Head of Sales

 

September 2016 Energy Market Review 

In September, day-ahead gas moved 10.2% lower to average 27.9p/th. Meanwhile, day-ahead power soared 45.6% to £53.2/MWh.

Peak wind power generation dropped to around 1GW on 19 September, tightening margins in the UK. In addition, continental European imports were lowered by 2GW on the back of planned interconnector outages. Seasonal gas prices declined by 3.7% on average, despite a slight climb in oil prices. Winter 16 gas experienced the largest drop, of 5.6%, to average 39.6p/th. Summer 17 gas decreased 3.1% to 36.8p/th.

Read More

 

October’s Tax Tips & News

Welcome…


To October’s Tax Tips & News, our newsletter designed to bring you tax tips and news to keep you one step ahead of the taxman.

If you need further assistance just let us know or you can send us a question for our Question and Answer Section.

We are committed to ensuring none of our clients pay a penny more in tax than is necessary and they receive useful tax and business advice and support throughout the year.

Please contact us for advice in your own specific circumstances. We’re here to help!

· Finance Bill 2016 receives Royal Assent· Termination payments consultation· HMRC launch online disclosure service for agents

· Lifetime ISA guidance updated· October Question and Answer· October Key Tax Dates

Finance Bill 2016 receives Royal Assent top

The Finance Bill 2016 finally received Royal Assent on 15 September, enacting proposals announced in the 2016 Budget, Autumn Statement 2015 and Summer Budget 2015. Amongst other things, Finance Act 2016 includes provisions relating to income tax rates and allowances; restrictions on tax reliefs for travel and subsistence expenses (in effect since April 2016), the reduction of the lifetime allowance on pension contributions from £1.25m to £1m (again, effective from 6 April 2016); and the reduction in the main rate of corporation tax to 17% for financial year 2020.

The Act is based on George Osbourne’s final Budget. The annual Finance Bill usually receives Royal Assent in early to mid-July. This year’s extensive delay has been largely blamed on the Brexit referendum followed by the summer parliamentary recess.

Finance Act 2016 can be found online http://www.legislation.gov.uk/ukpga/2016/24/contents/enacted/data.htm.

 

Termination payments consultation top

Following a recent consultation, the Office for Tax Simplification (OTS) is currently consulting on proposed changes to the tax and National Insurance Contributions (NICs) treatment of termination payments.

The current rules governing termination payments are complex and are sometimes open to manipulation by employers to take advantage of the employer NIC exemption in particular. Employers sometimes attempt to change the nature of payments so that they effectively become exempt termination payments, where strictly, they should be charged to tax and NICs.

The proposed changes are therefore designed to provide certainty for employers and employees, whilst being fair, simple to implement, and not open to abuse or manipulation. At present, the government is proposing the following changes, which if enacted, will take effect from April 2018:

– the first £30,000 of a termination payment will remain exempt from income tax; and any payment paid to any employee that relates solely to the termination of the employment will continue to have an unlimited employee NICs exemption.
– the scope of the exemption for termination payments will be clarified to prevent manipulation by making the tax and NICs consequences of all post-employment payments consistent. In order to achieve this, tax and Class 1 NICs will be payable on any payment that the employee would have received it they had worked their notice period, even if the employee is asked to leave employment immediately or part way through their notice period. This will also remove the confusion about the different rules for payments in lieu of notice (PILONs) by making all PILONs taxable and subject to Class 1 NICs.
– the rules for income tax and employer NICs will be aligned so that employer NICs will be payable on payments above £30,000 (which are currently only subject to income tax).
– the following changes will also be made to the exemptions for termination payments: – removal of foreign service relief; and
– clarification that the exemption for injury does not apply in cases of injured feelings because of the divergence of judicial decisions about this issue.

The government’s consultation response document and the draft legislation can be found online here.

 

HMRC launch online disclosure service for agents top

Where a client has failed to report all their income and gains, tax advisers and agents are now able to make a disclosure to HMRC using a new online service.

To use the online service, the agent will need to sign in to, or set up a Government Gateway account. It is possible to fill in the form on-screen, print and post it to HMRC.

Further details regarding the service can be found https://www.gov.uk/government/publications/hm-revenue-and-customs-disclosure -service.

 

Lifetime ISA guidance updated top

HM Treasury has updated its factsheet on the new Lifetime Individual Savings Account (ISA), which are expected to launch in April 2017. Key features of the new ISA include:

– Accounts may be opened by investors aged between 18 and 40.
– Savings invested in the account before age 50 will attract a government bonus of 25%.
A maximum of £4,000 may be saved each year on which the 25% bonus will be paid. This equates to a maximum bonus of £1,000 a year.
– Some or all of the money can be used to buy a first home, or it can be saved until the investor is 60.
– The savings can be used for the purchase of a first home worth up to £450,000 across the country.
– Limits apply per person rather than per household.
– Investors who have a Help to Buy ISA can transfer those savings into the Lifetime ISA in 2017-18, or continue saving into both – but they will only be able to use the bonus from one to buy a house.
– After his or her 60th birthday, the investor can take out all the savings (including the bonus) tax-free.
– Money can be withdrawn at any other time, but the investor will have to pay a 25% charge. This effectively recovers the government bonus and applies a small charge.

 

October Question and Answer top

Q. I have recently started a new job and, for the first time in my career, I have been provided with a company car. I have to pay for fuel for private use but my employer says I can claim mileage for business journeys. Will I have to pay tax on fuel payments?

A. In addition to the company car benefit charge, employees have to pay tax on any fuel their employer provides that is used for private mileage. For 2016-17 you would calculate this amount by multiplying the car’s CO2 percentage by £22,200. So, if the percentage is 28, the tax charge for petrol is £6,216. For a basic rate taxpayer, the after-tax cash equivalent is £1,243 and for a higher rate taxpayer £2,486. The charge is the same regardless of whether you use 2 litres or 2,000 litres of fuel.

However, this tax charge can be avoided if you pay all the private fuel costs back to your employer. You need to keep accurate records (mileage logs and fuel receipts) to support such a claim to HMRC.

Your employer can give you a tax-free fuel allowance if you pay for fuel used for business travel in your company car. HMRC publish new advisory fuel rates four times a year. The most recent rates, apply from 1 September 2016.

Rates currently range from 11p per mile for smaller petrol cars (under 1400cc); 13p for those with engines between 1401cc and 2000cc; and 20p per mile for larger petrol cars (over 2000cc). Lower rates apply for cars using cheaper liquid petroleum gas (LPG), ranging from 7p (1400cc or less); 9p (1401cc to 2000cc); and 13p (over 2000cc). Rates for cars with diesel engines currently range from 9p per mile for cars with engines of 1600cc or less; 11p per mile for those with engines of 1601cc to 2000cc; and 13p per mile for those with engines larger than 2000cc. Petrol hybrid cars are treated as petrol cars for this purpose.

HMRC accept that, where an employer reimburses an employee for the cost of fuel for business mileage in a company car at the above rates, no taxable benefit arises.

A full list of past and current mileage rates can be found on the HMRC website https://www.gov.uk/government/publications/advisory-fuel-rates.

Q. I am a director of a limited company, which is registered for VAT. I have recently formed a limited partnership, with my limited company being the only general partner and another business being a limited partner. HMRC have written to me advising that I am unable to register the limited partnership for VAT as my limited company is already VAT-registered. Is this correct?

A. Yes. In a limited partnership there must always be at least one general partner with unlimited liability. A limited partnership, composed of individual limited partners, and a corporate general partner, offers a combination of total limited liability and the advantages of the partnership structure.

If a limited partnership is registered with the Registrar of Companies, then HMRC will only allow the registration in respect of the general partners, not any of the limited ones. This is because a limited partner cannot be held liable for any debts or obligations of the limited partnership. If the limited partnership goes into debt, the limited partner is liable to lose only the contribution he made to the partnership, the remaining debt will fall to the general partners.

In your case, because the limited company is already VAT-registered and is the only general partner of the limited partnership, you would be treated as the same legal entity for VAT registration purposes and would not be able to obtain separate VAT registrations.

Q. Having been an employee of a company for many years, I was appointed to the board of directors from 1 March 2016. I understand that Class 1 National Insurance Contributions (NICs) are calculated differently for directors. Can you please explain how it works and let me know what will happen for the rest of the current tax year?

A. NICs for directors are calculated by reference to an annual, rather than weekly or monthly earnings period. You became a director in week 44 of the 2015/16 tax year, which means that the primary threshold and upper earnings limit are calculated for the rest of the tax year by multiplying the weekly values by 9 (the earnings period starts with the week of appointment). So, from your date of appointment in 2015/16 to the end of the 2015-16 tax year, you will pay Class 1 NICs at the main rate of 12% on your director’s earnings between £1,008 (9 x £112) and £7,353 (9 x £817) and at the additional 2% rate on all earnings above £7,596 paid up to 5 April.

For 2016/17 you will pay Class 1 contributions evenly throughout the year. If, for example, your monthly salary is £9,000, you will pay Class 1 contributions as follows:

April (month 1) – salary £9,000 – NICs payable £112.80 (£9,000 – £8,060 (being the primary threshold) x 12%)

May (month 2) – salary £9,000 – NICs payable £1,080.00 (£9,000 x 12%)

June (month 3) – salary £9,000 – NICs payable £1,080

July (month 4) – salary £9,000 – NICs payable £1,080

August (month 5) – salary £9,000 – NICs payable £840.00 (£7,000 x 12% plus £2,000 x 2%: upper earnings limit of £43,000 reached)

September (month 6) to March (month 12) – NICs payable each month: £9,000 x 2% = £180.00

Total NICs due for tax year: £5,452.80

 

October Key Tax Dates top

1 – Due date for payment of Corporation Tax for the year ended 31 December 2015

5 – If a Tax Return has not been received, individuals and trustees must notify HMRC of new sources of income and chargeability in 2015/16

14 – Return and payment of CT61 tax due for quarter to 30 September 2016

19 – Tax and Class 1B national insurance due on PAYE settlements for 2015/16

19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/10/2016 or quarter 2 of 2016/17 for small employers

31 – Deadline for 2015/16 self assessment paper returns to be filed for HMRC to do the tax calculation. If a paper return is being filed also the deadline for tax underpaid to be collected by adjustment to your 2017/18 PAYE code (for underpayments of up to £3000 only)

Disclaimer
The information contained in this newsletter is of a general nature and no guarantee of accuracy can be given. It is not a substitute for specific professional advice in your own circumstances. No action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material can be accepted by the authors or the firm.

Howard and Company is the trading name of GM Howard & Company Limited, a company registered in England and Wales. Reg No 5307665. Registered office, Unit 17, Park Farm Business Centre, Fornham St Genevieve, Bury St Edmunds, Suffolk IP28 6TS.