Sunday Long Reads: Fake Fabulous Life, Echo Chamber world, Secession, Rwandan Manhunt, Human Composting
Obviously I am a complete sad-o at many levels, one of which includes my love of taking the family to stay at a Premier Inn Hotel. Sadly, taking a trip to a different part of the country has been slightly tricky in the last year for obvious reasons but hopefully it is all going to be a bit different in six months time or so. The update today from Premier Inn owner Whitbread plc (WTB) admitted to a few challenges but leaves me optimistic still on the shares, even if their move over the last six months has gone from near twenty quid a share to today’s level of over thirty-one quid a share.
In the wider scheme of things, no huge surprises in today's first half numbers from Premier Inn owner Whitbread (WTB). You will recall my history with this one – I took big profits thanks to the largesse of Coca-Cola in buying Costa at a material premium (how's that one working out I wonder?), but then backed the rights issue and even - last time - observed I would increase my stake even further at twenty quid a share. I did not get that opportunity but market moves and shifts might still give me that opportunity as pandemic angst continues. Today's update builds on the bare bones of the trading update I wrote up a month or so ago at the link above...
Back in July I observed why worrying about an 80% like-for-like revenue decline at Premier Inn owner Whitbread (WTB) was not an investment-stopping concern for me. I even concluded that, buoyed by the monies raised from this year's rights issue, 'I retain my decent sized position and ceteris paribus would add more at around twenty quid'. We will come back to that latter observation later. But today's first half trading update (for the six months to the end of August) does show a little improvement...
Regular readers will recall I cheered Coca-Cola's largesse in splurging on the Costa Coffee chain from Whitbread (WTB) and hence when the company wanted some of those distributed returns back a month or two ago to invest into its Premier Inn hotel range, I was supportive – observing that 'a crisis is an opportunity and with many hotels struggling to survive, Whitbread pounds (or in Germany euros) can go a long way in terms of locations'. And it certainly is a general crisis...
Normally a preliminary results announcement would be of the uppermost interest when thinking about the daily newsflow grind around a FTSE-100 company. However, for Whitbread (WTB) today its own preliminary update is superseded by a rights issue announcement from the owner/operator of the Premier Inn franchise. A rights issue! In the current era of placings, it felt like a blast from the past to have a table showing the indicative timing of events...
I have loved up Whitbread (WTB) shares many times on this website, most recently here where I noted it was trying to do the right thing for their employees. Friday's short regulatory update - which confirmed that the company was an 'eligible issuer under the UK Government's Covid Corporate Financing Facility (CCFF)' also noted 'as at 16 April the business has accessible cash reserves of c.£400 million and access to £900 million of its existing committed Revolving Credit Facility (RCF)' which certainly gives them a bit of time and flexibility.
Let's face it, nobody really knows but you do not need to be an investing genius to know that Sunday newspaper headlines about the lockdown persisting until June is not good news if you are an investor or an entrepreneur. Yes, you can push out a bunch of mitigation tactics and - yes - governments and central banks are stepping up, but the longer this period of time goes on for, the harder it gets for everyone.
Hello, Share Diggers. When I was looking for a hotel in the Smoke last month, I was shocked that Premier Inn, a so-called budget hotel, wanted £360 for two nights, a huge increase on my room last year. I bet they’re not charging that now. This brings me no joy, especially as this family has shares in Whitbread (WTB) which owns Premier.
Yet the one or two deaths it brought to Britons become headline news. Can you possibly imagine every flu death being treated in the same way? Meanwhile, there are signs of that China, the source of the outbreak, is seeing a drying up of cases. That’s surely likely to happen everywhere.
I am playing a bit of catch-up today but my first port of call has to be yesterday's interim numbers from the Premier Inn and Beefeater owner Whitbread (WTB), which I have loved-up many times on these pages. Helpfully it sold off Costa for a pretty penny but the share has been a bit desultory year-to-date, including failing a couple of times at the c. fifty quid level. In a way I am almost surprised it did not fall more yesterday…
A bit of a 'same old, same old' feeling to today's crop of regulatory news statements and Whitbread (WTB) is indicative of this. I said back in February that the owner of Premier Inn had a plan – and I think that remains the case. Or as it put it…
Hello, Share Clangers. When I’m away on business, which is rather too often for my liking, I prefer to stay in Premier Inns. My reason is not that I think they’re great but that because, as a shareholder, I nab two nights for one at weekends. However, I don't hold the shares for this handy perk, but because the room prices are comparatively cheap – which is what stingy customers want these days...
Hello Share Treaters. As a customer of Premier Inn hotels and not a coffee drinker in Costas, I was pleased Whitbread (WTB) has just sold its coffee places to Coca-Cola this month. Costa coffee shops always look a bit bland to me with few of the quirky attractions offered by independent purveyors. While Premier Inn hotel rooms are very reasonable and convenient in city centres. Plus, if you are a shareholder, you get two nights for the price of one at weekends.
As I described a couple of months ago HERE, one of my investing highlights of 2018 has been the bid by the soda behemoth Coca-Cola for the Costa Coffee business of Whitbread (WTB). This left the FTSE-100 name with one major asset, its hotels business Premier Inn...and a bunch of speculation about whether it would look to encourage bids for this asset too...or use some of its windfall to accelerate the growth of the value-centric hotel brand.
Hello, Share Markers. I admit it. The reason I bought into Whitebread (WTB) a year and half ago was to bag the shareholder perk of one night for the price of two at its Premier Inns. With it came money off at its various restaurants and a voucher for coffee at Costa.
Back in the day, the last business day of the month was always a rather important moment for me because it would determine whether I was a hero or a zero in the institutional investor world I used to belong to. Believe me, in the emails and related that followed, the whole investment firm would know whether your Fund had done well or badly. Of course the way to build performance was one month at a time, so a 'good close' to the month was immensely useful. If I was still in that world - and invested akin to my thoughts today - then I would have a big beaming smile on my face, thanks to the news update from my old mucker Whitbread (WTB) whose shares I have been continuously loving up on this website (most recently HERE)…
Hello, Share Saddlers. I’m ashamed to admit that one of the main reasons I bought Whitbread (WTB) shares is that it came with a deal for two hotel nights at Premier Inns for the price of one. We are testing the waters on this one with a romantic weekend break later this month.
A couple of larger cap favs of mine to write about today following new newsflow. I see that the ITV (ITV) COO/CFO has decided to exit into the night and retire. He has been at the company for a decade and no doubt he has made a pretty penny for his efforts. I do not think there is any particular fire here and he will hang around until a successor has been appointed. However my instinct is that there is another story here.
I concluded my last write-up on Premier Inn and Costa Coffee owner Whitbread (WTB) hoping for an event inspired by both activist shareholders on the company's ownership register and the new right-on Chairman Crozier who previously had set a fire below both ITV (ITV) and Royal Mail (RMG). Well today - finally – it delivered with the announcement that 'Whitbread will pursue a demerger of Costa, providing shareholders with investments in two distinct, focused and market-leading businesses'.
I seem to have written about one of my 2017 'tips of the year' Whitbread (WTB) more in 2018 than I did during its twelve months in the sun. A couple of weeks ago I observed that the appointment of the new Chairman, combined with an activist shareholder on the books could well tip the company over the edge in terms of thinking about the value creation option of splitting its two largest and most successful franchises Costa Coffee and Premier Inn. I also mused that the market reaction to this would push the shares back to trading at £50+.
I have already given my excuses concerning my 2017 tip of the year Whitbread (WTB), which only went dully up last year. I concluded in that piece that I would 'hold on' and I am. Today's announcement of a change at the top of the company's management structure reiterates such a position.
Whitbread (WTB) has had an up-and-down year since my last update on the stock - HERE. The Costa and Premier Inn operator unsurprisingly has been impacted by the changes in perception towards the strength (or not) of the UK consumer and this has pushed the shares between a £36 and £42 range this year. Today's interim results have again pushed the shares towards the lower end of this range despite the company reiterating its hopes for the full year.
Hello Share Screechers. It was a bonus when I bought some Whitbread (WTB) shares and found I could wangle hotel accommodation at half price. Well, actually, the deal for shareholders is you and yours get a free Sunday at a Premier Inn if you stay on a Saturday night. Up to two rooms are on offer. Here are some other share perks you might like.
Is the UK consumer completely shot? For the last year we have had a waxing and waning in views from 'the experts' on this. The reality is that it depends who you talk to but, biggest picture, what is needed is a great product, attractive marketing and a base underlying need. I last chatted through the Whitbread (WTB) investment case in late January, where I concluded that the stock was still worth a punt...
Hello Share Samplers. I’m quite excited about this. This family has now received its Whitbread (WTB) shareholder’s discount card. A good investment that, as I’ve only held the share a few weeks and am already up by 12%. And the added perk is really quite good, as shareholder discounts go.
First trading update of my (long) tip of the year for 2017 and the shares are down 4%. Worried? Of course not…the Whitbread (WTB) share price is still nicely above where I recommended it…and frankly we are not even a month into the year. The magnitude of the move today reflects the (to use a wonderful phrase poached from a fellow market observer) wildebeest financial market backdrop we have at the moment…
Hello Share Cravers. Whitbread (WTB) is a name which still conjures up old-fashioned pubs and breweries. Not necessarily a great business to be in that, as pubs seem to close down all over the shop.
If you want to buy just one new single stock in the FTSE-100 for 2017 you need to look at the perceived Brexit losers given, over the course of the next 12 months, Brexit apocalypse will move further away via delays and position dilution. Forget big overseas earners as this backdrop will crimp their translated back into Sterling earnings so it has to be more domestic plays. And filtering for market leadership, strong balance sheet and continued growth hopes I end up with Whitbread (WTB) the owner of the Costa Coffee and Premier Inn franchises.
Hello Share Thumpers. The big hotel and catering set-up Whitbreads (WTB) has had an encouraging write-up in my modest column before. If anything my enthusiasm has increased since then. The first three months of this year were promising both for its hotels and for its Costas, the Italian- sounding, but not, chain of coffee houses, which seem to be springing up everywhere.
Hello Share Trillers. When I think of that well-known British name Whitbread (WTB), I think of pubs and beer. As I am a red wine man, this does not always thrill me.
Having worked in the markets of the City for more years than I can remember, I have certain notions, ideas and truisms built into my sense awareness that is as indicative as the brand mark on a Texas steer. The one I have in mind at the moment - contained in my book on how to play the share market which I wrote at the request if Tom Winnifrith himself and awaiting publication - is that the share prices of highly rated stocks do not withstand disappointment. To that may be added the old notion that troubles, when they com, come not as single spies but in battalions. That is not in my book but in Shakespeare’s play King Lear.
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