The M&C20 was down 2.6% last week underperforming the All-Share which was down 1.3% as domestic sectors once again underperformed the wider market. The All-Share was held up by gains in oil and mining stocks on the back of rises in the oil price, though this didn’t prove enough to offset what has been a week of decline for most major stock markets.

The M&C20’s big caps were more hit sharply than the wider market with Greene King down 2.9%, Domino’s Pizza down 2.1% and The Restaurant Group down 2.1%. Marston’s outperformed its peers rising 0.1% over the week as Royal Assent was given to the amendments to the Market Rent Only clause of the Small Business, Enterprise and Employment Bill, allowing franchises to be excluded from the legislation.

Punch and Enterprise on the other hand were down 2.6% and 2.0% respectively as the market continues to consider the implications of the above legislation on tenanted pub operations. M&B significantly underperformed ending the week 7.8% lower than it started.

Bowling alley operator Essenden saw its shares up another 8.9% this week following a bid approach from Harwood Capital. The company has stressed that ‘there is no certainty that this approach will lead to an offer being made for the Company’ and says that the group will update the market ‘as appropriate’.

Eclectic Bar Group’s shares were down 47.1% this week, the second time the shares have halved since the group’s first profit warning back in November. The group was downbeat on trends among students, on whom they rely for their midweek trade, and did not see this trade returning in the near future.

According to research by the late-night bar chain, students were focussing more on their studies during the week, choosing to go out later in the evening and go home earlier. Students also appear to be ‘pre-loading’ before they go out, though the company said that it was able to tempt them through the door for specific events, and trading at the company is holding up well on big days. The shares listed back in November 2013 at 160p and are currently down to 48p.

Recently floated Revolution Bars was up 0.9% this week, having fallen 4.7% last week. The shares are still at a 3.7% discount to the issue price.


Commentary by Will Brumby of Langton Capital