Headlines
• London will move to ‘Tier 2’ on Friday
• Police search home of French health minister
• Hong Kong and Singapore agree travel bubble
• Oxford University develops five-minute test
• Frankfurt book fair, the world’s largest, to go ahead this week
Company news
Leisure
• Domino’s Pizza – “We saw a benefit from staycations and the return of live sport on television during the period, although we also saw a headwind, as competitors reopened following the national lockdown and, in September, we saw weaker demand in university areas. We were pleased to reopen our collection business, and collection orders were around 60% of the prior year level. We do not expect our collection business to fully recover to prior levels until normal consumer behaviour returns.”
• Hostelworld – “Looking ahead to the rest of the year, we no longer expect an improvement in the macro travel environment and therefore expect any recovery to be muted. Based on this, and our current visibility of forward-looking bookings, we now expect full year net bookings to be in the range of 20- 22% of FY2019 (Base Case: 25% of FY2019 / Pessimistic Case: slightly below the Base Case) and net revenue to be in the range of 16-18% of FY 2019 (Base Case: 20% of FY2019 / Pessimistic Case: slightly below the Base Case).
• Marston’s# – “Since 4 July, we had reopened approximately 99% of our pubs by the year end, though a small number closed subsequently as revised regulations were introduced in Scotland. Managed and franchised like-for-like sales averaged 90% of last year over the 13-week period to 3 October:
July -26%
August 6%
September -12%
13 weeks since reopening -10%
On 12 October, the UK Government introduced a ‘3 Tier’ system of guidance depending upon rates of infection and perceived risk in different parts of England. Within our estate, we have 21 pubs in Scotland, of which eight are currently closed, and we have 18 pubs in the ‘highest risk’ Liverpool region, the majority of which serve food and under the existing guidelines are capable of remaining open.
The initial effect of these new rules has been to undermine consumer confidence and create uncertainty. Restoring confidence will only happen when UK Government and the devolved administrations are able to remove these restrictive measures, which they state are intended to be short term in nature.
The introduction of these further restrictions and guidance affecting pubs is hugely disappointing in view of a lack of clear evidence tying pubs to the recent increase in infection levels, and our own data, which suggests that pubs are effective in minimising risks. Very few incidences of Covid-19 infection have been reported in our pubs by employees or guests to date, supporting our view that socialising in pubs, where social distancing is enforced and hygiene standards are high, presents lower risks than in other non-regulated settings. Unlike many other retail settings, we committed to collecting Test & Trace data from the moment we were able to open.
Inevitably, and regrettably, recent restrictions will impact jobs. Since the start of the pandemic, our objectives have included protecting the health and livelihoods of our teams. Government support over the summer was vital, and around 10,000 colleagues have so far returned to work. However, because of the recent additional restrictions, we have reluctantly concluded that around 2,150 pub-based roles currently subject to furlough are going to be impacted. Furthermore, we have initiated a full review of overhead costs, which will be concluded by the end of December. These decisions are difficult but are necessary due to the restrictions placed upon our business at this time.”
Retail
• Dunelm# – “Total sales in the quarter were £359.1m, an increase of £96.5m year over year, as we continue to win market share in a buoyant homewares market. We announced at the start of September that trading in the first two months of the financial year had been materially ahead of our initial expectations. This trend has continued, with the final month of the quarter also being very strong. We have delivered meaningful growth across our total retail system, with online (home delivery) sales growth continuing at the levels previously reported, and strong growth in stores.”
Support Services
• Hays – “In our first quarter, ended 30 September 2020, group net fees were significantly impacted by the pandemic and decreased by 29% on a like-forlike basis versus the prior year, and by 30% on an actual basis. The modest strengthening of Sterling versus most of our reporting currencies slightly reduced our reported net fees.
Like-for-like net fees in Temp (62% of group fees) and Perm (38% of group fees) declined by 25% and 35% respectively. Overall, our largest specialism of IT (26% of group fees) fell by 22%, Construction & Property fell by 33% and Accountancy & Finance by 34%. Our large Corporate Accounts business, Hays Talent Solutions was more resilient and declined by 13%.
Transport
• Ryanair – has announced cuts to its winter flight schedule, saying it will operate at only 40% of last year’s capacity. There has been “materially” weaker bookings in November and December. The airline is closing its bases in Cork, Shannon, and Toulouse for the winter, but expects to maintain 65% of routes with reduced frequencies.
Other
• French police searched the home of health minister Olivier Véran today as part of an inquiry into the government’s handling of the coronavirus crisis. Véran is one of several current or former ministers being investigated over their response to the pandemic, after complaints by victims that they were slow to act to check its spread. Officers also searched the home of the director of the national health agency, Jérôme Salomon.
• Hong Kong and Singapore will set up a travel bubble, the two cities have announced, as they moved to re-establish overseas travel links and lift the hurdle of quarantine for visiting foreigners.
• Jordan is to resume a two-day lockdown from midnight tonight, following a recent rise in coronavirus cases.
• Oxford University has developed a five-minute Covid-19 test. The university hopes to start making the devices in early 2021 and have it approved six months after that.
• New restrictions come into force in Portugal today after a ‘state of calamity’ was declared. Public gatherings are limited to five people and weddings to 50. A record 2,072 cases was announced on Wednesday.
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