•  Dekon Johnson 

    Leisure – Sector focus

    Author: Dekon Johnson, Relationship Director
    Publication date: 01.04.2010

     
    The leisure market’s exposure to consumer discretionary spending means that the current economic climate has created many challenges. All of our clients have been affected by the downturn, although the degree of impact varies and reflects certain key drivers, including brand strength, ticket size, the efficacy of new product development as well as the ability to manage costs and maintain ongoing investment.

     
    The UK government’s planned cuts are likely to have an impact on leisure spend. We have already seen a drop in the number of foreign holidays (and, within that, packaged holidays) taken by UK residents, and this has had an impact on tour operators. We continue to watch this sector closely.

     
    Uncertainty for the gaming market 

     
    Over recent years, government legislation has become increasingly relevant to the gaming market and, with various studies and reviews on-going, we are keeping a careful watch on this too. However, regardless of background uncertainties, businesses continue to focus on costs while maintaining a close eye on consolidation opportunities.

     
    Despite encouraging figures about the upturn in the UK economy, many commentators are undecided on the timing of full economic recovery. Studies continue to highlight the importance of leisure time to UK consumers, with short breaks and holidays, for example, remaining an important priority. With changing demographics added to the mix, a number of key upsides for the leisure market do exist.

     
    There has been a general improvement in the banking market and liquidity during 2010, with some softening of margins and terms. However, the sovereign debt crisis has had a negative impact on this trend, and margins are beginning to level. Clients are exploring new and alternative funding sources to provide greater flexibility and to diversify debt supply and maturity profiles.

     
    One example is the move into the capital markets, including the sterling and euro bond markets. Working closely with key clients we have led a number of restructuring transactions over the past few months. Changing the funding mix is a key driver, but trading conditions remain challenging and uncertain, so retaining a top-tier and supportive banking group is still a priority.

     
    Bringing support to UK leisure 

     
    Since I joined Lloyds Banking Group in 1987, I have worked in a number of roles, ranging from the branch network, where I focused on small, local firms, through to our mid-sized commercial business. I now concentrate on Lloyds corporate banking. I have managed the corporate leisure portfolio for the past six years, which comprises a selective client list of key names. There are many challenges within my role, and while I am keen to support and grow long-term relationships, the important first step is always to understand the business, management strategies and goals. Lloyds has supported the leisure sector for many years, and I am committed to continuing that endeavour.

     
    We have recently appointed Tulsi Narayan as Relationship Manager for the bank’s Wholesale Banking & Markets leisure division. Tulsi will be responsible for strengthening relationships with existing customers across the sector and the further development of this important business. A key part of her new role will be working in close cooperation with product groups such as capital markets and financial markets, in order to provide tailored and value-added financing solutions to existing and future clients.

     
    Source: This article was first published in Lloyds Banking Group - Perspective Magazine Edition 1.
     

2/24/2018 10:16:22 PM