Shaftesbury reports high footfall across West End but average spend and dwell time ‘has the potential to be significantly higher’: Central London landlord Shatfesbury has reported high footfall across the West End, but said average spend and dwell time “has the potential to be significantly higher”. In its half-year report for the six months to 30 June 2024, the company reported strong leasing demand across all uses, with 217 leasing transactions representing £28.1 million of contracted rent, 7% ahead of December 2023 estimated rental value (ERV) and 16% ahead of previous passing rents. It reported a 3.2% like-for-like increase in ERV to £241.0m (Dec 23: £236.9m) and annualised gross income up 3.9% like-for-like to £196.5m (Dec 23: £192.8m). It also reported high occupancy, with 2.7% of ERV available to let (Dec 2023: 2.1%), with “high levels of footfall, customer sales growth and increasing levels of international tourism” across its estate. “With high footfall across the West End, the Elizabeth line is enhancing transport connectivity for visitors, shoppers, workers and tourists alike,” the company said. “The investment market in which we operate has been active for some time demonstrating demand for high quality prime central London real estate. Transactional evidence is now being reflected in more stable valuation yields and rental growth is delivering improved valuations and income. The occupational market in the core West End is strong and has been improving for some time. We have had leasing success across our portfolio and are delighted that our initiatives are translating into rental performance. The increased scale and depth provide opportunities for customers to expand and move around the portfolio. To date, over 20 customers have upsized or taken additional units across the portfolio. Our rents and valuation are well underpinned by strong leasing demand and are set for further growth. Our investment priority is currently focused on three core locations, Covent Garden, Carnaby | Soho and Chinatown. Against an improving market backdrop, we are looking at opportunities to expand, adding to our growth prospects. As we implement our strategy to unify the Covent Garden district, we are seeing the benefit of incorporating Seven Dials and Opera Quarter as part of one destination through leasing, asset management and marketing activity. Our customers and consumers are responding positively with demand for available shops and restaurants. We have been able to make changes in Seven Dials at pace, which is re-enforcing consumer interest in the wider Covent Garden area and delivering leasing performance. Building on the strong brand line-up, we are beginning to evolve the offer on Carnaby Street paying close attention to brand selection and categories that provide higher productivity, whilst taking inspiration from the area's rich history and demand for surrounding Soho streets. Based on analysis of consumer data and our experience elsewhere, the average spend and dwell time has the potential to be significantly higher which should be supportive of rental growth over time. This will be achieved through targeted leasing activity, introducing differentiated concepts, relevant to the consumer and we have made good early progress with a number of recent signings. In Chinatown, through an active approach, we are introducing more variety and choice to the area increasing the pan-Asian offering at a range of price points, which is delivering rental growth.” Chief executive Ian Hawksworth added: “We are very pleased with performance across the business. Having set clear priorities, we are delivering on strategy. Conditions across the West End's occupational and investment markets continue to improve. Our strong leasing activity at rents on average 7% ahead of December 2023 ERV is delivering rental growth and increased valuations. With a strong balance sheet, we are well-positioned to generate rental growth and take advantage of market opportunities.”

Just Eat reports 7% revenue growth in UK & Ireland in first half but order volumes down: Just Eat has reported 7% revenue growth in the UK & Ireland in the first half of 2024 but said order volumes are down in the region. For the six months ending 30 June 2024, its revenue was up 7% from €629m in the first half of 2023 to €672m, while adjusted Ebitda was up 64% from €56m to €92m. General transaction value (GTV) also increased from €3.2bn to €3.4bn, but orders were down from 121 million to 120 million. “Our UK and Ireland segment made up 27% of the total Just Eat Takeaway.com orders and 26% of the total GTV during the first six months of 2024,” the company said. “UK and Ireland orders were broadly flat versus H1 2023. Our grocery business and delivery coverage continued to expand. In H1 2024, we successfully doubled our grocery consumer penetration compared with H1 2023, through adding large chains such as Morrisons and doubling the Sainsbury's estate. Considerable headroom remains for continued expansion in our grocery and retail business, offering significant opportunities to grow our future revenues and further optimise our delivery network. GTV increased by 9% year-on-year, or 6% on a constant currency basis, to €3.4bn in H1 2024 from €3.2bn in H1 2023, the highest GTV growth of this segment since 2021, driven by higher delivery order mix and higher average transaction value (ATV) due to food price inflation, increased consumer fees and positive foreign currency exchange movements. UK and Ireland was our fastest growing segment in terms of GTV in H1 2024. UK and Ireland revenue grew by 7% to €672m in H1 2024 from €629m in H1 2023, broadly in line with GTV growth. Adjusted Ebitda increased to €92m in H1 2024 from €56m in H1 2023. The adjusted Ebitda margin improved to 2.7% in H1 2024 from 1.8% in H1 2023 with a trajectory to reach similar levels of adjusted Ebitda margin as in Northern Europe. The delivery cost per order has notably improved in H1 2024 compared with H1 2023, enabled through the simplification of our operations. We completed transition of all UK logistics orders to our own delivery platform in July 2024.” Overall, the company reported half year adjusted Ebitda of €203m, an increase of over 40% year-on-year. It also announced free cash flow before changes in working capital of €38m in H1 2024 and a new share buyback programme of up to €150m. Chief executive Jitse Groen said: “Driven by growth of our partner base, expansion of our delivery coverage and significant technological advancements, GTV growth further improved in H1 2024. I am pleased that, at the same time, our adjusted Ebitda grew to €203m in H1 2024, which is 42% higher than in the same period last year. We are well on track to achieve our guidance for the full year.” The company said it continues to actively explore the partial or full sale of Grubhub, and has announced its intention to cease operations in France.

Starbucks records second straight quarterly drop in sales: Starbucks has recorded a second straight quarterly drop in sales, underlining the pressures on senior managers already contending with an activist shareholder and scrutiny from the company’s former boss. The world’s largest coffee chain cited a “cautious consumer environment” as it said its global comparable sales fell by 3% in the third quarter that ended in June, following a 4% decline in its previous quarter. Analysts had expected a fall of about 2.4% in the third quarter, reports the Financial Times. It comes as Starbucks negotiates with activist Elliott Investment Management, which has been seeking changes at the $85bn company in which it has amassed a stake. Starbucks’ board and management have also faced public criticism from Howard Schultz, the former chief executive who built up the company after first taking the reins in 1985 and remains its sixth-largest shareholder. Laxman Narasimhan, chief executive since early 2023, has been working to win back customers whose spending power has been eroded by inflation. In China, a critical growth market, Starbucks has struggled in the face of multiplying competition and a sluggish economy. The group’s net revenues for the quarter fell 0.6% to $9.1bn, below Wall Street expectations of $9.2bn. Net profit dropped by 7.6% to $1.05bn, marginally above consensus. To boost demand, Starbucks has launched new deals and promotions such as $5 combos of coffee and a croissant. Narasimhan said a three-part action plan was “beginning to work and driving operational improvements that we expect to improve financial performance”. Rachel Ruggeri, chief financial officer, said its efficiency efforts were “tracking ahead of expectations” but had been partially offset by “investments associated with the cautious consumer environment”. The company said its operating profit margin shrank by 0.6 percentage points year over year in the quarter, to 16.7%. This was “primarily driven by increased promotional activity”, raising wages for baristas and “deleverage”, or cutting debt. In China, comparable sales slid by 14%, reflecting lower amounts paid per visit and fewer transactions overall.

Thomas Straker says brunch is an ‘abomination’ ahead of new restaurant opening: Calling a late-morning meal “brunch” is an “abomination”, according to celebrity chef Thomas Straker. The restaurateur, who has a following of more than five million on Instagram and TikTok, has said the popular combination of breakfast and lunch should simply be referred to as breakfast. “I think the word ‘brunch’ is an abomination…just call it breakfast,” he told Tatler. His comments come ahead of the opening of his second restaurant on Goldborne Road, which will feature brunch-associated menu items such as granola, acai bowls and eggs. Straker said the new restaurant, which follows the success of his west London hotspot Straker’s, would be a “breakfast-lunch kind of deli scenario”. Straker also revealed he spends his weekends working out at White City House, part of Soho House members club. He told the magazine that he “runs two pretty big businesses” and “can’t afford to be incapacitated”, adding that he has “matured” and “found more balance in my life”.

Workplace illness costing UK firms an extra £30bn a year: Soaring workplace illness is costing UK firms an extra £30bn a year, with days off sick doubling since 2018, a report has revealed. Employees now phone in sick an average of 6.7 days a year, which is up from 3.7 days six years ago, reports the Daily Mail. This means the annual cost of staff absence has increased by £5bn over this period, analysis by the Institute for Public Policy Research (IPPR) reveals. However, the biggest cost to business comes from ‘presenteeism’, when Brits turn up to work despite being unwell and unable to give their best, the think tanks claims. Its report says a typical employee now loses the equivalent of 44 days productivity a year due to working through sickness. This is up from 35 days since 2018, with the additional slack days hitting profits by £25bn a year, researchers found. The IPPR wants a new tax incentive for companies that commit to improving their workforce's health; a ‘do no harm’ duty for employers; and compulsory reporting on worker health. It describes the UK as “the (literal) sick man of Europe”, with poor quality jobs, overconsumption of unhealthy food, smoking, gambling and low rate of investment impacting public health. It warms that growing sickness will lead to people living longer in poor health, as well as posing a “grave fiscal threat”.