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Thu 30th Jan 2020 - Update: Fuller's and Diageo trading, Wetherspoon boss receives investor group support
Fuller’s reports managed like-for-likes up 4.3% over Christmas and 2.5% year to date: Fuller’s, the premium pubs and hotels business, has reported like-for-like sales in its managed division were up 4.3% for the six weeks encompassing Christmas and new year. For the 42 weeks to 18 January 2020, like-for-like sales in managed pubs and hotels have risen 2.5%. All areas of the business – food, drink and accommodation – have been in like-for-like growth. Tenanted like-for-like profits are down 3% for the period. Chief executive Simon Emeny said: “It’s been a year of change for Fuller’s and this is a good first Christmas as a focused premium pubs and hotels business. We have exciting plans in place for the coming months including the opening of our new sites The Windjammer at Royal Dock, The White Horse at Wembley Park and The Parcel Office at Liverpool Street Station. We will also be moving to our new offices at Pier House in Chiswick at the end of March. This is a very busy time for Fuller’s as we complete the integration of Cotswolds Inns & Hotels, undertake a number of major capex projects including the redevelopment of The Bear of Burton in Dorset and our new Bel & The Dragon site at Westerham in Kent, as well as continue to grow our existing business. In addition, we are approaching the conclusion of the transitional services agreement with Asahi, while maintaining a keen focus on reducing our central costs against a backdrop of rising wage inflation and business rates. There is a lot to do – but we relish the challenge. We will next update the market on 11 June, when we announce the company’s full year results for the 52 weeks to 28 March 2020.”

Diageo reports GB net sales up 2% in first half: Diageo has reported net sales in Great Britain grew 2% for the six months ending 31 December 2019. Of its British performance, the company stated: “Performance was mainly driven by Guinness, Baileys and Captain Morgan, partly offset by a decline in Gordon’s due to lapping a strong prior year innovation, and the continued impact of commercial negotiations following prior year pricing decisions. Guinness performance benefited from growth of Guinness Draught in the on-trade and key digital activations targeting specific after-work occasions. Baileys’ strong performance was driven by focused promotional activity, while Captain Morgan’s growth was due to strong on-trade performance.” Overall, Diageo reported net sales increased 4.2% to £7.2bn with operating profit rising 0.5% to £2.4bn, with organic growth partially offset by adverse exchange, exceptional operating items and acquisitions and disposals. All regions contributed to broad based organic net sales growth while organic volume grew 0.2%. Organic operating profit grew 4.6%, ahead of organic net sales, driven by productivity benefits from everyday cost efficiencies and strong price/mix, partially offset by cost inflation and upweighted marketing investment. Chief executive Ivan Menzies said: “Diageo has delivered another good, consistent set of results in the first half, with broad based organic net sales growth across regions and categories. We have continued to increase investment behind marketing and growth initiatives, while expanding organic operating margins. During the half, we returned £1.1bn to shareholders via share buybacks, as part of our plan to return up to £4.5bn of capital to shareholders for the period FY20 to FY22. We have also delivered another half of solid free cash flow at almost £1bn. These results reflect the changes we are making in the business to drive shifts in our culture. They are in line with our current mid-term guidance and have been delivered in the face of increased levels of volatility in India, Latin America and Caribbean and travel retail. For the full year, we therefore expect organic net sales growth to be towards the lower end of our 4% to 6% mid-term guidance range. We continue to expect organic operating profit to grow roughly one percentage point ahead of organic net sales. There is ongoing uncertainty in the global trade environment and we would not be immune from further policy changes. We remain focused on building the long-term health of our brands, supported by data-led insights and a culture of everyday efficiency. With the consumer at the heart of the business and with greater agility and discipline in the execution of our strategy, we are growing Diageo in a consistent, sustainable way.”

JD Wetherspoon boss receives backing from Investor Forum over City rules, gets top employer recognition: JD Wetherspoon chairman Tim Martin has received support from one of the City’s most powerful voices in his row with shareholders over the pub company’s board. The Investor Forum represents a group of investors with more than £18.5 trillion under management. Martin spoke out in November over fund management companies Columbia Threadneedle and Blackrock’s decision to vote against the re-election of some of the Wetherspoon board. Investors were concerned Wetherspoon was in breach of new corporate governance rules. Speaking as the organisation published its annual report, The Investor Forum chief executive Andy Griffiths told The Telegraph: “Tim really has engaged with the issue. I think he is good at explaining why he doesn’t want to comply.” Griffiths applauded the Wetherspoon boss for not simply “reiterating” an entrenched stance. Martin suggested City rules on boardrooms were “up the spout”, particularly the guidance board members should stand down after nine years. He has argued this risks losing directors who can offer valuable experience to a company. Meanwhile, Wetherspoon has been certificated as a top employer in the UK for 2020. It is the 17th consecutive year the pub company has been certificated by independent organisation the Top Employers Institute. The certification is based on independent research that shows Wetherspoon has “outstanding HR policies and offers excellent working conditions”. Wetherspoon commercial, legal and personnel director Su Cacioppo said: “The recognition comes from an independent organisation which researches numerous companies, so it is extremely pleasing that Wetherspoon is considered among the best across the UK. Wetherspoon is committed to offering each and every staff member the best opportunity to succeed and grow within the company, including studying for qualifications and apprenticeships. This is evident in the number of staff rising through the ranks at Wetherspoon.” Wetherspoon employs more than 43,000 staff across its pub estate and head office.

Ninth Ward owners to open Temple of Foo in St Paul’s: The Church Group, the US-based company behind the Ninth Ward restaurant and bar in London’s Clerkenwell, is to open its second site in the UK, in St Paul’s. The company, which operates a handful of sites in New York, will launch the Temple of Foo restaurant and bar on the former Zelman Meats site at 33-34 Old Bailey. The new venue will offer craft beer, cocktails and “moreish junk food in a gothic luxe setting”. The Church Group opened its Louisiana-themed bar and restaurant concept Ninth Ward in early 2015, which marked its first launch outside New York. Inspired by New Orleans’ vibrant Ninth Ward area, the venue in Farringdon Road offers ten to 15 craft beers on tap – including American ones, as well as cocktails. CDG Leisure acted on the St Paul’s deal on behalf of the landlord Land Securities, while Raven Rose acted on behalf of Temple of Foo.

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