Young & Co.'s Brewery, P.L.C. Class A · LSE:YNGA
Young & Co.'s Brewery, P.L.C. Class A — FY2009 Earnings Presentation
31 slides from Young & Co.'s Brewery, P.L.C. Class A's earnings presentation, March 2009
Slide 1: Results Presentation
Results Presentation for the 52 weeks ended 28 March 2009
Slide 2: Agenda
Agenda 1. Highlights 2. Financial review 3. Operations review 4. Outlook 1
Slide 3: Highlights
Highlights • Robust performance in very challenging conditions – Financial market turmoil – Recession – Inflationary pressures and duty increases • Adjusted profits before tax up 3.1% at £19.2 million • Adjusted EPS up 5.7% at 27.77p • Proposed dividend increased 2.0% to 6.63p 2
Slide 4: Robust results in testing market
Robust results in testing market +5.7% +3.2% +3.1% +2.0% -1.5% Operating Revenue PBT* EPS* Dividend profit* £126.1m £20.5m £19.2m 27.77p 12.75p All results on continuing activities and where marked * adjusted for exceptional items and other non recurring items 3
Slide 5: Acquisitions
Acquisitions • Total investment of £12.1m • All high quality managed pubs – The Old Ship, Chiswick (on the Thames) – Parrot, Canterbury – The Roebuck, Hampstead – The George, Fulham • The Beaufort, a new development in Hendon opened during the year 4
Slide 6: The strategy
The strategy Retail success from delighting customers with stylish pubs, high service standards, quality food and market leading drinks Premium offer • Food • Drinks • Training/Service Premium location • Exploiting the location • Ambience/environment 5
Slide 7: Active estate management
Active estate management • Acquisitions – £12.1M invested in four acquisitions – £3.7M invested on developing pubs acquired this year and last • Improved returns from recent investments and developments – Strong returns from prior year managed house refurbishments – Sales up 23.3% – Cash return on i
Slide 8: 2. Financial review
EST. 1831 YOUNG'S: 2. Financial review
Slide 9: Adjusted profits on continuing operations
Adjusted profits on continuing operations 2009 2008 £M £M Reported PBT (including Wells & Young’s) 4.2 11.6 Add back Wells & Young's tax included above 0.7 (0.8) Young’s exceptional items 10.5 (0.7) Wells & Young’s exceptional items 3.8 3.8 Premium on redemption of debenture - 6.8 Discount of site p
Slide 10: Review of exceptional items
Review of exceptional items 2009 £M Young’s Profit on sale of property 0.9 Impairment of properties (10.6) Capital gains tax on ESOP shares (0.1) Hotel project fees written off (0.7) (10.5) Wells & Young’s Impairment of property (2.7) Reorganisation costs (0.6) Foreign exchange contracts 0.4 Interes
Slide 11: Strong cash flow & continued investment
Strong cash flow & continued investment 2009 2008 £M £M Cash inflow from operating activities 26.4 26.6 VAT owed on site disposal (10.3) 10.3 Interest, tax and dividends (9.0) (10.1) Free cashflow 7.1 26.8 Capital expenditure and acquisitions (24.4) (38.1) Exercise of share options 0.6 1.8 Premium o
Slide 12: Investment in the pub estate
Investment in the pub estate Total spend: £24.0M (2008: £38.1M) By Division By Nature of Spend Acquisitions - £12.1M Investment on recent acquisitions - £3.7M Managed - £22M Tenanted - £2m Investment expenditure on existing estate - £8.2M 10
Slide 13: Estate profile of trading pubs
Estate profile of trading pubs April March + - Transfers 2008 2009 Managed 116 5 1 122 Tenanted 103 - (3) (1) 99 Total 219 5 (3) - 221 Freehold 183 4 (2) - 185 The freeholds above exclude eleven leases with in excess of 40 years to run, with rents that in total amount to less than £10K 11
Slide 14: Geographical split of Young's pubs
Geographical split of Young's pubs West Country (inc Oxford) Home Counties - 32 24 City - 9 Central London - 18 Thames-side - 14 West London - 17 Other Greater London - 29 South London - 12 South West London - 66 12
Slide 15: Debt structure
Debt structure Long dated committed facilities • £50m long term finance (March 2018 to 2023) £90.0m • £40m medium term finance (March 2013) Net debt £65.3m Gearing (no revaluation since 1997) 40% % of debt fixed 54% Interest cover 5.4X Composite fixed rate on fixed debt 6.0% 13
Slide 16: Financial summary
Financial summary • Solid results in testing conditions • Continued dividend growth • Conservative financing in place for the long term • Good cash generation and strong balance sheet 14
Slide 17: 3. Operations review
3.2.Operations Retail Operations review
Slide 18: The Publican awards, 24th March 2009
The Publican awieee, 24th March 2009, Condor
Slide 19: Operational highlights
Operational highlights • Significant market challenges – Credit crunch/recession impact sales – Costs and duty increases impact profitability • Managed houses – Top line growth but flat LFL sales – Additional cost pressures – Managed houses represent 88.6% of Retail turnover and 82.3% of EBITDA – Pu
Slide 20: Managed Houses – key financials
Managed Houses – key financials • Revenue up 4.5% • LFL revenue flat on same outlet basis • Total food sales up 7.3% and maintained gross margins • RevPAR down 7.9% to £38.69 • Operating profit down 3.4% at £25.9M, reflecting significant cost increases and disruption on sites acquired last year 16
Slide 21: Managed Houses – key initiatives
Managed Houses – key initiatives • Product range – Comprehensive cask ale offering including guest ales – Exciting lager portfolio with continental heritage – New wine lists in all our pubs – The look and feel of a free house • Food menus and promotions – New food menus focussing on best of British
Slide 22: Tenanted Houses – key financials
Tenanted Houses – key financials • Revenue down 3.3% • LFL revenue down 4.9% with beer volumes down 9.3% • One transfer to management • Operating profit down 2.7% at £5.8 million • High quality estate that is part of our heritage and future 18
Slide 23: Tenanted Houses – key initiatives
Tenanted Houses – key initiatives • Product range – Innovative wine range giving unique list of wines but at affordable prices – Guest ale programme gives tenants product range and point of difference – Suppliers working directly with tenants to drive volumes – Established tenants forum to build on
Slide 24: Like-for-like sales
Like-for-like sales Number Sales Change of sites £m % Same outlet Managed 107 103.9 - Tenanted 94 12.7 -4.9 201 116.6 -0.6 Un-invested Managed 84 82.1 -1.9 Tenanted 82 10.4 -6.1 166 92.5 -2.4 20
Slide 25: Operating performance at pub level
Operating performance at pub level 2009 2008 Change Revenue £000’s £000’s % Managed 111,415 106,630 +4.5 Tenanted 14,329 14,818 -3.3 125,744 121,448 +3.5 EBITDAR* Managed 34,231 34,171 +0.2 Tenanted 7,465 7,710 -3.2 41,696 41,881 -0.4 * At outlet level, before interest, depreciation, rents payable 2
Slide 26: Key performance indicators of same outlet pubs
Key performance indicators of same outlet pubs Managed Average weekly revenue £18.7K 0.0% per pub Food Mix 25.5% +0.2% points Average EBITDAR £310K -1.1% Tenanted Average EBITDAR £71.0K -5.4% 22
Slide 27: Wells & Young's – performance review
Wells & Young’s – performance review • Young’s share of PBET of £1.9 million in line with expectations • Contracted out primary distribution to KNDL – £2.8m share of exceptional impairment charge on distribution centre – £0.6m restructuring costs • Young’s Bitter becomes the UK’s first cask ale to s
Slide 28: Operations summary
Operations summary • Robust performance given the very challenging conditions • Continuing to invest • Tight focus on costs • Supporting tenants • Quality acquisitions will continue, but only at sensible prices 24
Slide 29: 4. Outlook
YOUNGS. 4. Outlook
Slide 30: Outlook
Outlook • Challenging conditions set to remain • Market conditions remain difficult, not least as a result of rising unemployment • Additional costs will continue to affect the business, duty rises and the strength of the euro in particular • Trading in the last 13 weeks was 3.0% ahead of last year
Slide 31: Questions
Questions
Young & Co.'s Brewery, P.l.c. — FY2009 Earnings Presentation on 6ix