Dry January boost (TAP)
According to CGA by NielsenIQ average on-premise sales in the U.K. increased 11% YOY in the week ended January 21, the third week of January. Sales increased 24% in the first week and 13% in the second week. That compares to inflation of 10.5%. Soft drink sales led beverage categories with 18% growth, while beer increased by 14%, cider increased by 15%, and wine increased by 15%. Spirits decreased by 3%, the worst week since November. Canada issued new alcohol guidelines in 2023 suggesting no more than two alcoholic beverages on any given day for adults and that three to six drinks a week is considered moderate risk while seven or more a week is deemed high risk. Dry January has a larger participation rate in the U.K. where it originated from. One survey reported 35% of the drinking-age population in the U.S. took part in abstaining from alcohol in January. Of course, the real reason on-premise sales are so strong is the Omicron comparison and soda sales can not save bars if people drink less alcohol.
Flu monitor (PRGO)
The CDC estimates that there have been at least 25 million illnesses from the flu this season through the week ended January 21. The flu had surged since Thanksgiving but is declining in most areas despite the Christmas and New Year’s holidays. The flu sometimes has two peaks, but influenza A(H3N2) continues to be the main subtype. If that continues this season’s flu will have started early and ended even earlier. The cumulative hospitalization rate was more than 1.4 times higher than the highest cumulative in-season hospitalization rate observed for this week since 2010-11. 12.0% of deaths that occurred during the week were attributed to pneumonia, influenza, or COVID-19, above the 6.8% threshold for an epidemic. Perrigo’s Q4 is mostly set for the cough & cold season as orders are already in and production is maximized, especially for liquid medicines. Most retailers are short of cough & cold medicine. A larger or longer cough & cold season would be seen in Q1 results as retailers reorder more inventory.
Little Blue Menu (LANC)
Chick-fil-A operates a delivery-only concept called Little Blue Menu. The prototype is overseen by three Chick-fil-A operators in Nashville and consists of two restaurant concepts. Customers can order from the Chick-fil-A menu as well as Little Blue Menu’s Outfox Wings and Because, Burger. Nashville is also home to Chick-fil-A’s only delivery only restaurant. Chick-fil-A is planning to open a second Little Blue Menu restaurant in College Park, Maryland later this year. Delivery-only restaurants would open up further expansion potential for the 2,600 unit restaurant chain. Chick-fil-A is Lancaster Colony’s largest customer with 21% of sales in 2021.
