Football’s World Cup and a boost to hospitality spend normally go together like, well beer and football, but this year’s tournament is a bit different.

And while the market often prices in the impact of a major football tournament ahead of time, a winter World Cup has left investors somewhat on the back foot when it comes to predicting exactly how the chips are going to fall for the sector this Christmas.

There’s no doubt England’s successful progression to the quarter finals will tempt some supporters out to their local hostelry to watch the match in the company of like-minded fans but they might go instead of attending the work Christmas do or perhaps that night out will come at the expense of another festive meet up with a few friends.

Will a winter tournament change consumer behaviour, especially when that consumer is wrestling with the cost-of-living crisis? Will they settle for a case of supermarket beer at home rather than perfectly pulled pints in the pub?

Just looking at share price performance since the start of the competition, investors do seem to have warmed up to the possibility that despite the controversy about both venue and timing of the tournament fans simply won’t be able to ignore the lure of an England team on the prowl for glory.

Pub chains Mitchells & Butlers (MAB), Fuller, Smith & Turner (FSTA) and Marston’s (MARS) have all enjoyed a bit of a bump since November as scenes of jubilant fans knocking back a barrage of bevies are beamed onto news programmes and social media platforms.

Marston’s like for like beer sales during the first two World Cup games were up a whopping 50% compared to the same period last year. It’s latest results show a return to profit but warn of squeezed margins so any opportunity to grab additional trade will be welcome.

NOT EVERYONE’S A WINNER

JD Wetherspoon (JDW) is an unsurprising outlier; despite the fact the pub chain has relaxed its stance on football for the tournament it’s decision to keep the sound on mute has rather dampened investor appetite with many wondering if that will be a strike for or against Tim Martin’s chain.

Wagamama owner The Restaurant Group (TRG) has also failed to chime with investors perhaps curious as to whether cash strapped consumers will be forced to cut back on the noodles to pay for pints – chipping away at crucial Christmas trade.

A World Cup Spending report compiled by the VoucherCodes.co.uk website at the start of November 2022 estimated that UK fans will spend a whopping £278 million on drink over the course of the tournament – equating to 65.3 million pints of beer. The website estimates consumers will spend rather less on food, based on previous World Cup consumption around £117 million, but the big question is where will they spend it?

During the last World Cup back in 2018 Domino’s Pizza (DOM) saw sales on England match days rise by an average of 15.2%, but the day of the week on which the games were played made a big difference, with weekdays providing the biggest boost and Saturday matches working against the pizza giant.

A TWIST IN THE TALE

And how will a national rail strike play into this particular game? The semi-final match dates fall uncomfortably on the first of the RMT’s planned December walk outs and the date of the final is likely to be dogged with delays and disruption as services struggle to resume after a second round of strikes.

UK hospitality has already warned that industrial action on the railways could cost the sector £1.5 billion in lost sales – a similar figure to that estimated to have been lost to beleaguered businesses following disruption caused by a surge in the Omicron Covid-19 variant last year.

The sector had hoped this Christmas would finally deliver an uninterrupted run, a period when plans didn’t require rearranging or worse, cancelling altogether. Many workplaces held their Christmas parties in January last year and some might well be considering taking the same action for a second time in a row.

At least the football can be enjoyed without travelling far, if at all. Local pubs are likely to become meccas, although both pubs and homes will likely find themselves longing for the summer’s big bonus – an extra room in the garden.

Another would be winner of this winter’s World Cup appearance is ITV (ITV). The broadcaster’s hugely important advertising revenue was down £26 million in the nine months to 30 September and the prospect of recession was clearly something the company was thinking carefully about.

There are big ifs and no one wants to jinx what comes next, but if football were to truly come home, well that could shift sentiment for more than just ITV.

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