Restaurants
PTLO IPO
Another restaurant IPO! Portillo's is an iconic Chicago "street food" multichannel restaurants company. On the surface, the AUV's and RL margins are pretty impressive. We will be hosting a PRE-IPO deck in the coming weeks. From the S1 - "Since our founding in 1963 in a small trailer which Dick Portillo called "The Dog House," Portillo's has grown to become a treasured brand with a passionate (some might say obsessed) nationwide following. Our diverse menu features all-American favorites such as Chicago-style hot dogs and sausages, Italian beef sandwiches, chopped salads, burgers, crinkle-cut french fries, homemade chocolate cake, and milkshakes. We create a consumer experience like no other by combining the best attributes of fast-casual and quick-service concepts with an exciting, energy-filled atmosphere and restaurant model capable of generating tremendous volumes. Nearly all of our restaurants were built with double lane drive-thrus and have been thoughtfully designed with a layout that accommodates various access modes, including dine-in, carryout/curbside, delivery, and catering to quickly and efficiently serve our guests. As of June 27, 2021, we owned and operated 67 Portillo's restaurants across nine states. less.
Consumer Staples
Spirits and wine store traffic (VWE)
Liquor store traffic remains considerably higher than pre-pandemic levels, as seen in the following chart. Placer.ai compared the customer traffic at three regional chains BevMo! in the West, Spec's in Texas, ABC Fine Wine & Spirits in Florida, and the national chain Total Wine. In 2021 August was the first month that traffic was not up at least 20% for Total Wine; it was up 19.1%. The deceleration in August was due to the first two days of Labor Day weekend included in August 2019, but not August 2021.
Comparing summers for spirits and wine (VWE)
Off-premise alcohol sales decreased 7.0% this summer compared to last summer (week ended May 8 to September 11). Sales were still up 14.2% compared to the summer of 2019. Spirits sales had the smallest decrease, down 3.7%. Spirits sales were still up 30% to the summer of 2019. Compared to last summer, only prepared cocktails and tequila had grown. Prepared cocktails grew 45.1%, driven by RTD cocktail growth of 106.6%. Tequila grew 5.0% over last summer and grew 84.4% compared to 2019. Whiskey decreased 3.8% compared to last summer but grew 26.2% over 2019. Higher-end spirits continued to experience faster growth this summer, with the ultra-premium price tier up 12.4% compared to last summer and double 2019.
Wine decreased 8.7% compared to last summer but increased 13% in off-premise channels compared to 2019. Table wine decreased 11.1% compared to last summer but increased 6.4% vs. 2019. Sparkling wine decreased 0.7% to last summer but increased 35.8% vs. 2019. Wine-based cocktails grew 39.6% last summer and were up 228% to 2019. California wines grew 6.4% compared to 2019. The premiumization trend in wine continued with table wines priced between $20-25 up 1.2% over last summer, while the wines priced above $25 grew 4.0%.
Winc IPO (BEV)
Winc filed its S1 registration Monday evening. Winc is a winery that develops blends based on consumer data and trends. It sells tailored wine subscriptions through DTC and also sells to wholesale and retail accounts. Business Insider named it the best overall wine club. Forbes said it was the most accessible wine club. It has 120,000 members and 7,700 retail customers. In the year ended June 30, it had revenue of $71M. In the six months ended June 30, it had revenue growth of 20%. The company is seeking $75M in its IPO.
Winc's background is also unique in that it was funded in part through equity crowdfunding. Its customers are concentrated among 21- to 44-year-olds. Younger wine consumers have been quicker to adopt wine blends than older drinkers who focus more on the provenance. In June, Winc purchased Natural Merchants, a top importer of organic and vegan wines from Europe and South America. Some of the issues with the IPO include it is not profitable, the monthly retention rate of the wine club was 92% in the most recent six months, the market's unfamiliarity with the business model, a perception of low barriers to entry, and the small size.
Constellation's fast-growing Meiomi wine brand is also a blend. In addition, vintage Wine Estates and Duckhorn have seen strong growth in wine clubs and DTC due to the pandemic.
