Data room

Stock Watch

23 January 2020

Japan Airport Terminal Co was our star performer in 2019, in terms of percentage change between stock prices at the start and end of the year. How will the travel retail-related companies we monitor in this Stock Watch column perform in 2020?

The coronavirus outbreak is a reason for much concern as the year begins. As reported, key indexes for the US economy pulled back on 21 January after the US Centers for Disease Control & Prevention confirmed the country’s first case of the coronavirus that originated in Wuhan.

Asian markets recorded heavy losses across the board in the same day’s trade, with travel companies among the most impacted as fears rise that the virus may spread faster than first anticipated. Shares in Hotel Shilla (-3%) and Japan Airport Terminal Co (-4.5%) were among the hardest hit on 21 January.

In the period tracked in this first Stock Watch of 2020 – closing prices between 1 and 21 January – shares in Japan Airport Terminal Co fell -10.9%, while shares in Hotel Shilla remained up +6.3%, largely because of significant growth in the early part of January. Shares in China Duty Free Group (CDFG) parent China International Travel Service dropped -7%.

Dufry subsidiary Hudson Group did not fare well in 2019 as its stock price fell -12.6%, and that trend continued in January as a -12.2% drop was reported in the period covered here. Shares in parent Dufry itself were also down, at -6.2%.

Travel food specialist SSP Group issued a trading update for the first quarter of its financial year (1 October to 31 December), with revenues climbing +6.1%. On a constant currency basis, Q1 revenue rose by +7.5%, comprising like-for-like sales growth of +1.2% and net contract gains of +6.3%.

SSP has also announced the proposed acquisition of Station Food in Germany. Once fully operational in 2021, Station Food will add 28 new food & beverage units at railway stations in Germany and is expected to contribute approximately £10 million to SSP’s revenue in 2020.

Shares in SSP were up +3% in the period monitored here, but jumped from £6.64 on 20 January to £6.82 on 21 January, when the Q1 results were announced (+2.71%).

The Moodie Davitt eZine

Issue 275 | 23 January 2020

The Moodie Davitt eZine is published 20 times per year by The Moodie Davitt Report (Moodie International Ltd).

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