Daily Brief Consumer: Travelodge Hotels , TSE Tokyo Price Index TOPIX, 4imprint, Upfield BV and more

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).

We view Travelodge’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.

Travelodge is the second-largest hotel chain in the UK, based on the number of hotels and rooms operated.

• While disclosure of committee activities in annual securities report provides clues to the independence of committee, this might create higher hurdle for moving to Company with US type 3 Committees.
• Based on the premise that disclosure of committee activities can change management’s mindset and enable committees to function, more specific details should need to be disclosed to all listed companies.
• Many companies have nominating committees that meet 1-2 times a year before the AGM. Few companies have a Succession Plan, which is of great interest to investors.

4imprint’s year-end trading update indicates that 2023 was a strong year for the group’s financial performance. Revenue of $1.33bn is in line with guidance reiterated in November of ‘slightly above $1.3bn’, but PBT is now guided at ‘not below $140m’, above our previous expectation of $131m. We attribute the stronger profitability to a combination of higher gross margin and marketing efficiency. Strong cash performance resulted in the year-end balance of $105m exceeding our prior $84m estimate. Our revised FY24 and provisional FY25 profit and cash estimates are pushed ahead on this higher base on a 10% operating margin. The shares continue to trade at a substantial discount to our DCF valuation.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We assess Upfield’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.
• Upfield (formerly Flora Food Group) is the world’s leading producer of margarine and other spreads.