Slide 1: Preliminary Results 15 September 2017
Royal Victoria Pavilion, Ramsgate PRELIMINARY RESULTS 15 SEPTEMBER 2017
Slide 2: Crown Hotel, Biggleswade
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Slide 3: Financial Summary
Financial Summary Var% 20172 2016 Var% (Exc wk53) wK53) 2015 2014 2013 20122 2011 2010 2009 2008 Revenue 1,660.8 1,595.2 +4.1% +1.9% 1,513.9 1,409.3 1,280.9 1,197.1 1,072.0 996.3 955.1 907.5 (£m) Like-for-like sales +4.0% +3.4% +3.3% +5.5% +5.8% +3.2% +2.1% +0.1% +1.2% -1.1% Profit before tax 102.8
Slide 4: Average Weekly Sales Per Pub (including VAT)
Average Weekly Sales Per Pub (including VAT) £000 41.7 42 39.0 40 37.4 38 36.0 36 34.0 34 32.3 31.1 32 30.1 29.9 30.1 30 28 26 24 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2
Slide 5: Underlying Earnings Per Share (pence)
Underlying Earnings Per Share (pence)* pence 66.6 70.0 65.0 60.0 55.0 48.0 47.6 50.0 44.7 43.8 41.3 45.0 40.0 34.9 35.3 32.6 35.0 27.6 30.0 25.0 20.0 15.0 10.0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 *Underlying earnings per share are before exceptional items and exclude gains/losses on pr
Slide 6: Like-for-like Performance
Like-for-like Performance % 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Bar +3.1 +3.3 +1.2 +2.7 +3.8 +2.8 +1.7 -0.8 +2.5 -4.3 Food +5.7 +3.5 +7.3 +12.0 +10.9 +4.8 +4.2 +0.1 -0.4 +7.9 Machines -1.2 -2.2 -2.8 -3.1 +0.4 -2.8 -3.9 +12.1 -7.5 -5.8 Hotels +9.9 +9.7 +24.2 +6.3 – – – – – – LFL sales +
Slide 7: 10 Year Operating Profit
10 Year Operating Profit £m 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Turnover 1,660.8 1,595.2 1,513.9 1,409.3 1,280.9 1,197.1 1,072.0 996.3 955.1 907.5 Pub profit (pre repairs) 330.6 288.3 285.4 284.4 259.0 245.4 226.8 218.5 208.4 199.5 Repairs (66.2) (54.9) (53.4) (59.4) (48.0) (46.6) (38.
Slide 8: Cost Increases
Cost Increases • Wages: +4.5% • Excise duty (+£7m pa from March 17) • Business rates (+£7m pa from April 17) • Apprenticeship levy (+£2m pa from April 17) • Sugar tax (+£4m pa from April 18) • Energy taxes (+£2m pa from October 17) • Bar and food – probably below inflation Swan and Angel, St Ives 6
Slide 9: Allocation of Resources
Allocation of Resources £13m Dividend £15m £24m £15m Freehold reversions and investment properties £14m £22m Share buybacks £89m £25m £5m £36m £5m £13m Capex on new and £15m existing pubs £8m £33m £23m £54m £28m £15m £8m £26m £17m £154m £151m £12m £121m £10m £113m £94m £99m £89m £82m £61m £49m 2008
Slide 10: Cash Capital Expenditure
Cash Capital Expenditure £m 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 New Openings: Acquisition and development costs: Current year 27.2 38.6 76.5 64.5 40.4 57.2 74.0 45.2 32.0 31.0 Future year 13.1 16.6 30.5 33.2 12.8 10.4 9.0 12.5 5.8 17.6 Freehold reversions and investment 88.6 36.1 21.6
Slide 11: Movement in Net Debt
Movement in Net Debt £m 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Opening Net debt 650.8 601.1 556.6 474.2 462.6 437.7 388.4 390.0 442.3 436.8 Free cash flow (107.9) (90.5) (109.8) (92.9) (65.3) (91.5) (78.8) (71.3) (99.5) (71.4) Disposal of fixed assets (19.6) (22.5) (0.7) (0.5) (0.6) (0.9)
Slide 12: 10 Year Debt Overview
10 Year Debt Overview 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Net debt/EBITDA 3.39 3.47 3.37 3.21 2.88 2.96 2.98 2.70 2.74 3.24 (EBITDAR - Reinvestment)/Fixed charge 2.21 2.14 1.97 1.79 1.88 1.75 1.74 2.01 2.14 2.05 Interest cover (times) 3.72 2.92 2.73 3.11 2.66 2.68 2.73 3.08 2.43 2.71 I
Slide 13: Property Update
Property Update 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Trading pubs at start of FY 926 951 927 886 860 823 775 731 694 671 Freehold pubs opened 9 10 24 31 14 18 34 15 13 13 Leasehold pubs opened 1 6 6 15 15 22 16 32 26 10 Closures/disposals (41) (41) (6) (5) (3) (3) (2) (3) (2) – Total tr
Slide 14: "It's a People Thing"
“It’s a People Thing” • More than 37,000 employees at the end of period • Dedicated employee website & e-learning suite • Catering Academy – 1,371 employees have graduated with 713 employees currently going through the programme • Strong manager retention. Average length of service for: • Pub manage
Slide 15: Changing Sales Mix since 2000
Changing Sales Mix since 2000 100% 4% 3% 6% 5% 4% 90% 18% (£4.2k) 24% (£6.6k) 29% 31% 35% 80% (£8.8k) (£10.0k) (£14.6k) 70% 60% Machines 50% Food Bar 40% 76% Hotel/Other (£17.2k) 71% (£19.8k) 66% 64% 61% (£19.8k) (£20.8k) 30% (£25.5k) 20% 10% 0% 2000 2004 2008 2012 2017 13
Slide 16: Peach BrandTrack: most used brand for sit down meals
Peach BrandTrack: JDW is by far the most used brand for sit down meals Q: Which of the following brands have you eaten at in the past 6 months? 1. 2. 3. 4. 5. 36% 22% 21% 21% 20% Percentage of GB population eating at brand in past 6 months Source: CGA Peach BrandTrack, Apr 2017 14
Slide 17: Peach BrandTrack: Standout choice for branded drinking occasions
Peach BrandTrack: Standout choice for branded drinking occasions 1. 3. 4. 5. 14. 15. 25. 42% 13% 13% 11% 7% 7% 5% Percentage of GB drinking population drinking at brand in past 6 months
Slide 18: Peach BrandTrack: 5th most used eating brand in GB
Peach BrandTrack: JDW is the 5th most used eating brand in GB, holding its own against quick serve outlets 1. 2. 3. 4. 5. 57% 47% 46% 37% 36% Percentage of GB population eaten at brand in past 6 months Source: CGA Peach BrandTrack, Apr 2017 16
Slide 19: Peach BrandTrack: 4th most visited for breakfast
Peach BrandTrack: 4th most visited for breakfast % of Breakfast users who have eaten at a brand for Breakfast 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% McDonald’s Costa Greggs JD Wetherspoon Starbucks Caffè Nero Burger King Subway Pret a Manger Frankie & Benny's 17% of all consumers who have eat
Slide 20: Successes and achievements
Successes and achievements • 891 of our pubs are Cask Marque approved • Raised £1.8m in the last 12 months and over £14.4m during the 15-year partnership with CLIC Sargent, a charity caring for children with cancer providing support for families at home and in hospital from the day of diagnosis • As
Slide 21: Taxation
Taxation FY FY FY FY FY FY 2017 2016 2015 2014 2013 2012 £m £m £m £m £m £m VAT 323.4 311.7 294.4 275.1 253.0 241.2 Alcohol duty* 167.2 164.4 161.4 157.0 144.4 136.8 PAYE and NIC 96.2 95.1 84.8 78.4 70.2 67.1 Business rates 53.0 50.2 48.7 44.9 46.4 43.9 Corporation tax 20.7 19.9 15.3 18.1 18.4 18.2 C
Slide 22: Current Trading and Outlook
Current Trading and Outlook • LFL sales for the six weeks to 10th September +6.1% • A positive start, but unlikely to continue for the rest of the year • Comparisons more stretching • LFL sales are likely return to more modest levels • Anticipate a trading outcome for the current financial year in l
Slide 23: Questions
Questions Royal Victoria Pavilion, Ramsgate
Slide 24: Appendices
wetherspoon Appendices
Slide 25: Appendices
Appendices • A 10 year overview • B 10 year capital trends • C 10 year financial trends • D1 ROC/CROCCE/ROE calculations • D2 ROC/CROCCE/ROE calculations • E1 Summary of exceptional items • E2 Pub disposal programme • F Swap maturity profile 23
Slide 26: 10 Year Overview
Appendix A 10 Year Overview Number of pubs £ millions Turnover 1000 1,800 950 1,600 900 850 1,400 800 1,200 927 951 1,661 926 1,595 750 886 895 1,514 860 1,409 823 1,000 700 1,281 775 1,197 694 731 1,072 650 800 908 955 996 600 600 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 2009 2010 201
Slide 27: 10 Year Capital Trends
Appendix B 10 Year Capital Trends 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Average Size (ft2) – Openings 4,379 4,264 4,321 3,585 3,643 3,325 3,572 3,781 3,359 3,618 Number of openings 10 16 30 46 29 40 50 47 39 23 % which are freehold 90 63 80 67 48 45 68 32 33 57 Freehold average cost (£k)
Slide 28: 10 Year Financial Trends
Appendix C 10 Year Financial Trends 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Sales per pub (£000) (1) 1,807 1,694 1,620 1,562 1,476 1,401 1,360 1,335 1,344 1,333 EBITDA per pub (£000) (2) 229.0 209.2 200.9 204.5 200.9 194.9 198.7 205.8 212.9 211.6 Number of pubs 895 926 951 927 886 860 823
Slide 29: ROC/CROCCE/ROE
Appendix D1 ROC/CROCCE/ROE FY FY 2017 2016 £000 £000 Shareholders equity per accounts 228,823 207,448 Deferred tax balances 63,119 63,015 Interest rate swaps valuations 38,896 63,477 Impairment balances 28,268 43,054 Net book value of revalued assets (6,278) (6,550) Adjusted shareholders equity (a)
Slide 30: ROC/CROCCE/ROE
Appendix D2 ROC/CROCCE/ROE FY FY 2017 2016 £000 £000 EBITDA (cash return) (e) 205,184 187,274 Depreciation and amortisation (f) (73,869) (72,212) EBIT (g) 131,315 115,062 Interest (28,485) (34,452) Profit before tax 102,830 80,610 Current tax (h) (24,591) (18,347) Profit after cash tax (i) 78,239 62
Slide 31: Summary of Exceptional Items
Appendix E1 Summary of Exceptional Items FY FY 2017 2016 £000 £000 Exceptional property losses Disposal programme (see next slide) 24,785 12,370 Other property losses Onerous lease reversal (696) (949) Onerous lease provision 1,076 977 Impairment of property, plant and equipment 1,664 1,924 Impairme
Slide 32: Summary of pub disposal programme
Appendix E2 Summary of pub disposal programme The company has offered several of its sites for sale. At the year end, 45 (2016: 29) sites had been sold, including sites which were closed in the previous year, five were classified as held for sale and an additional three (2016: nine) sites have been
Slide 33: Swap Maturity Profile
Appendix F Swap Maturity Profile Swap Value From To Weighted Average % £600m 31 Oct 2016 30 Jul 2018 1.7% £600m 31 Jul 2018 29 Jul 2021 2.7% £600m 30 July 2021 30 July 2023 1.7% £600m 31 July 2023 30 July 2026 1.0% 31
Slide 34: Preliminary Results
PRELIMINARY RESULTS WETHERSPOON This document may contain forward-looking statements that may or may not prove accurate. Phrases such as “target”, “intend”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions are generally intended to identify forward-looking statements. Forward-lo
Slide 35: Sustainable fish, Top Employer, Good Beer Guide
OUR Sustainable K Top Employer Beer Guide FISH Fish G o od 2017 A total of 262 Wetherspoon pubs All of the cod and haddock we is listed in CAMRA's Good Beer use for our freshly battered fish, Guide 2017 – the most of any pub including Fish Friday, are supplied company across the UK. The guide, from
Slide 36: jdwetherspoon.com
The Bottle Kiln, Harwich jdwetherspoon.com