Fuller, Smith & Turner P.l.c. Class A · LSE:FSTA
Fuller, Smith & Turner P.l.c. Class A — FY2018 Earnings Presentation
27 slides from Fuller, Smith & Turner P.l.c. Class A's earnings presentation, 2018
Slide 1: Annual Results for the 52 Weeks Ended 31 March 2018
ANNUAL RESULTS FOR THE 52 WEEKS ENDED 31 MARCH 2018
Slide 2: Highlights: Growing in the Fuller's Way
HIGHLIGHTS 2 GROWING IN THE FULLER’S WAY MANAGED LFL SALES REVENUE ADJUSTED PROFIT ADJUSTED EPS TOTAL ANNUAL DIVIDEND FY 2018 £403.6m £43.2m 62.90p 19.55p +2.9% +5% +3% +4% +4% FY 2017 (52 weeks) £384.0m £42.1m 60.23p 18.80p LFL sales for 2017 are for the 52 weeks to 25 March 2017 Compared to FY 201
Slide 3: Group Performance
GROUP PERFORMANCE 3 YoY YoY 2018 2017 Growth Growth £m £m (53 week) (52 week) Revenue 403.6 392.0 +3% +5% Operating costs (354.4) (342.5) +3% +5% Operating profit 49.2 49.5 -1% +1% Net finance costs (6.0) (6.6) -9% -8% Adjusted profit 43.2 42.9 +1% +3% Depreciation and amortisation 21.7 21.0 +3% +5%
Slide 4: Five Year History
GROUP OVERVIEW 4 FIVE YEAR HISTORY ADJUSTED PROFIT* ADJUSTED EPS ANNUAL DIVIDEND +39%† +49%† +43%† 19.55p £43.2m 62.90p 15.10p £34.1m 46.94p 2018 2014 2018 2014 2018 2014 * Adjusted profits are before separately disclosed items and tax † 5 year growth rates Annual Results for the 52 weeks ended 31 M
Slide 5: Managed Pubs and Hotels
MANAGED PUBS AND HOTELS 5 YoY YoY Commentary 2018 2017 Growth Growth • Continued LFL sales growth £m £m (53 week) (52 week) in all segments of the LFL sales growth* +2.9% +3.7% business Revenue 271.2 261.3 +4% +6% • Accommodated cost base Operating costs** (237.8) (228.9) +4% +6% increases, includin
Slide 6: Tenanted Inns
TENANTED INNS 6 YoY YoY 2018 2017 Growth Growth OPERATING PROFIT BRIDGE £m £m (53 week) (52 week) LFL profits* +3% -1% Average EBITDA per pub +2% +2% Revenue 30.2 31.2 -3% -1% Operating costs** (17.3) (18.0) -4% -2% Operating profit** 12.9 13.2 -2% -1% Operating margin 42.7% 42.3% Depreciation and a
Slide 7: The Fuller's Beer Company
THE FULLER’S BEER COMPANY 7 YoY YoY Commentary 2018 2017 Growth Growth • Principal driver of revenue £m £m (53 week) (52 week) growth has been a strong Total beer and cider volumes -1% Level performance from Nectar Revenue 152.9 147.9 +3% +5% • Challenging on-trade Operating costs* (146.1) (139.9) +
Slide 8: Sources and Uses of Cash
SOURCES AND USES OF CASH 8 £206.1m 210 £15.2m £0.2m £201.9m £10.6m £0.6m £31.0m 190 £10.8m 170 £5.2m £9.0m 150 £5.7m 130 £70.9m 110 90 70 50 Net debt EBITDA Interest Tax Other Capital Acquisitions Separately Property Dividends Non-cash Net debt 2016/17 adjustments expenditure disclosed disposals and
Slide 9: A Very Healthy Balance Sheet
A VERY HEALTHY BALANCE SHEET 9 Borrowing Capacity • Net debt at 31 March 2018 of £201.9m (31 Mar 2018) • £65.2 million available committed facilities and cash • 58% of period end net borrowings fixed or capped • Average cost of gross borrowings for 2018 of 2.8% £65.2m Available committed (2017: 3.0%
Slide 10: Investing for the Long Term
INVESTING FOR THE LONG TERM 10 New ERP 90 £81m 80 Corporate acquisitions £62m 70 £56m £56m 60 Pub acquisitions 50 £41m New site development 40 costs 30 Managed Pubs and Hotels (existing estate 20 investment) Tenanted Inns (existing 10 estate investment) 0 The Fuller's Beer 2015 2016 2017 2018 2019E
Slide 11: Our Vision
OUR VISION 11 To be the leading operator of stylish pubs and hotels, while brewing and supplying Britain’s most coveted premium brands for discerning customers both at home and abroad Annual Results for the 52 weeks ended 31 March 2018
Slide 12: Our Strategy
OUR STRATEGY 12 • To deliver a distinctive customer experience across the whole Fuller’s estate • To grow by carefully targeted acquisitions and developments that enhance our premium business • To build a leaner cost base by investing and improving processes to increase efficiency • To grow the repu
Slide 13: Building for the Future
BUILDING FOR THE FUTURE 13 • Disposed of 12 pubs that no longer fitted with our Tenanted Inns vision and strategy • Activated a number of key digital initiatives • Fuse – app-based internal communication tool to improve communication and knowledge throughout the Company • FnB food management system
Slide 14: Managed Pubs and Hotels
MANAGED PUBS AND HOTELS 14 • Another good year for Managed Pubs and Hotels, which have yet Analysis of Revenue again outperformed the Peach Tracker Accommodation • Managed Pubs and Hotels account for 68% of group operating profit 7% • High quality pub estate in stunning locations with wet sales acco
Slide 15: Managed Pubs and Hotels – The Fuller's Difference
MANAGED PUBS AND HOTELS – THE FULLER’S DIFFERENCE 15 • Recruit and develop the best people • Recruited 71 enthusiastic chef apprentices – with more to come next year • Continued commitment to structured career development with 7,920 face to face training days supported by online learning • Deliver d
Slide 16: Managed Pubs and Hotels – The Fuller's Difference
MANAGED PUBS AND HOTELS – THE FULLER’S DIFFERENCE 16 Continued investment in stunning pubs at a range of iconic locations • 724 bedrooms, with opportunities for more including • The Counting House, Cornhill – 15 • The Blackbird, Earl’s Court – 9 • The Cromwell Arms, Romsey – 9 • The White Hart, Stoc
Slide 17: Managed Pubs and Hotels – Acquisitions
MANAGED PUBS AND HOTELS – ACQUISITIONS 17 2019 INVESTMENT PLAN • Two pubs transferred from Tenanted Inns • The Mayfly, near Stockbridge • The Windmill, Southwark • Acquired The Manor, Christchurch – a superb country inn with 10 bedrooms, scheduled for a total refit • Three sites in the development p
Slide 18: Bel & The Dragon – A Perfect Fit
BEL & THE DRAGON – A PERFECT FIT 18 • An established, respected brand and a well-run business • Six fantastic pubs with a total of 57 bedrooms • Five sites are freehold • Average weekly sales of £28k • Potential to add at least another seven bedrooms • Located in Odiham, Churt, Windsor, Kingsclere,
Slide 19: The Stable
THE STABLE 19 • Year of solid progress in a very challenging market • Taken our passion for cider to new heights with further development of the Cidermaster programme • Appointed Gabe Cook, from TV’s Sunday Brunch, to be The Stable’s official Cider Ambassador • Further developed our vegan and vegeta
Slide 20: Tenanted Inns
TENANTED INNS 20 • Year of real progress to improve the appeal of our Tenanted Inns and build a model that is fit for the future • Initiatives that started during the last year are now taking root and beginning to generate good returns • 13 pubs on our new turnover agreement at year end – expect to
Slide 21: The Fuller's Beer Company
THE FULLER’S BEER COMPANY 21 Four key elements to the Beer Company strategy Brewing efficiencies • Investment in cask line automation, new bottling line and vehicles • New ERP system will improve processes and reduce costs Stronger customer relationships • Nectar gives access to wider customer base
Slide 22: Dark Star Acquisition
DARK STAR ACQUISITION 22 • Acquisition of Dark Star has many similarities strategically to Cornish Orchards • A 25 year history in craft cask ale brewing at a 14,300 barrel brewery • A well-established brand with strong regional credentials and the ability to grow the brand outside of its local area
Slide 23: Summary
SUMMARY 23 • Playing to our strengths to deliver another year of growth • Adjusted PBT up 3% to £43.2m • Adjusted EPS up 4% to 62.90p • Annual dividend up 4% to 19.55p • A year of consolidation, ensuring we are fit for the future with a number of projects either completed or nearing completion • Man
Slide 24: Current Trading and Outlook
CURRENT TRADING AND OUTLOOK 24 • Current trading • Managed LFL sales up 2.5% (2017: +6.6%) for 9 weeks • Tenanted LFL profits up 2% (2017: +5%) for 9 weeks • Total beer & cider volumes down 3% (2017: +7%) for 9 weeks • Excellent new acquisitions will add to the Fuller’s growth story in the coming ye
Slide 25: Appendix – Reconciliation to Statutory Profit
APPENDIX – RECONCILIATION TO STATUTORY PROFIT 25 52 weeks 53 weeks 2018 2017 YoY £m £m Growth Adjusted profit 43.2 42.9 +1% Separately disclosed items 0.4 (3.0) Profit before tax 43.6 39.9 +9% Tax on adjusted profit (8.8) (9.1) Tax on separately disclosed items - 1.7 Profit after tax 34.8 32.5 +7% A
Slide 26: Appendix – Separately Disclosed Items
APPENDIX – SEPARATELY DISCLOSED ITEMS 26 52 weeks 53 weeks 2018 2017 £m £m Profit on disposal of properties 6.1 0.9 Acquisition costs (0.6) (1.3) Replacement of core IT systems (3.4) - Reorganisation costs - (1.5) Asset impairments (1.9) - Deemed remuneration on the future purchase of shares in The
Slide 27: Appendix – Fuller's Inns
APPENDIX – FULLER’S INNS 27 1 Apr Acquired Disposed Lease Transfers 31 Mar Acquired Disposed 8 Jun Within 2017 expiry 2018 2018 the M25 Managed Pubs & 198 1 – (1) 1 199 10 – 209 60% Hotels Tenanted Inns 192 1 (12) – (1) 180 – (1) 179 27% Total Fuller’s 390 2 (12) (1) – 379 10 (1) 388 45% The Stable
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