Shepherd Neame Limited Class A · AQUIS:SHEP
Shepherd Neame Limited Class A — Shareholder Meeting (October 2014)
47 slides from Shepherd Neame Limited Class A's shareholder meeting presentation, October 2014
Slide 1: Shepherd Neame Ltd AGM 2014
BY APPOINTMENT TO: HIS ROYAL HIGHNESS THE PRINCE OF WALES SUPPLIER OF SPECIALIST ORDERS SHEPHERD NEAME LTD FAVERSHAM KENT Shepherd Neame Ltd AGM 2014
Slide 2: Miles Templeman, Chairman
Miles Templeman Chairman
Slide 3: 2014: Building a strong platform for the business to grow and develop
2014: Building a strong platform for the business to grow and develop Growth in turnover of 2.8% Growth in profits and earnings per share Operating profit before exceptional items up 5.5% to £13.4m Basic EPS up 12.9% and EPS before exceptional items up 16.9%* Statutory profit before tax up
Slide 4: 2014: Successful implementation of changes to the Business and Board
2014: Successful implementation of changes to the Business and Board Business reorganisation - Transfer of warehousing and logistics to KNDL October 2013 - Phased exit from contract brewing from October 2013 to December 2014 Board reorganisation around two trading divisions Graeme Craig – Brewin
Slide 5: Share capital reorganisation completed to align economic and voting rights
Share capital reorganisation completed to align the economic and voting rights of all shareholders Approved June 2014 - 11,457,500 ‘A’ shares and 68,000,000 ‘B’ shares converted to new structure of 14,857,500 50p ordinary shares New shares listed on ISDX Growth Market and CREST with simplified g
Slide 6: Key metrics restated for impact of share capital reorganisation
Key metrics restated for impact of share capital reorganisation Dividend Net Basic EPS Dividend Cover Assets EPS Pre Per Share Pre Per Exceptionals Exceptionals Share Pence Pence Pence Times £ As reported in 2013 43.0 48.1 25.15 1.9 9.81 Impact of share capital reorganisation (5.9) (6.6) - (0.3) (1.
Slide 7: Dividend per share
A year of further growth in net assets per share and dividend 35p Dividend per share Net Assets per share at book value* £14 30p £12 Net assets per share Dividend per share 25p £10 20p £8 15p £6 10p £4 2010 2011** 2012 2013 2014 * Restated for share capital reorganisation ** In 2011 a market valuati
Slide 8: Mark Rider, Finance & IT Director
Mark Rider Finance & IT Director
Slide 9: Performance highlights
Performance highlights 2014 2013 % Before exceptional items £m £m Turnover 138.7 134.9 2.8 Operating Profit 13.4 12.7 5.5 Net Finance Costs (4.6) (4.7) 1.1 Profit before Tax 8.8 8.0 9.3 Tax Rate (%) 18.5 23.8 EPS* (pence) 48.5 41.5* 16.9 Full Year Dividend per ordinary share (pence) 25.9 25.2 3.0 Re
Slide 10: Key drivers of trading performance
Key drivers of trading performance Tenanted revenue +2.2% Pub Turnover Managed revenue +10.8% Core own and licensed Brands (excluding contract) +6.1% Beer Volume Total own brewed volume (Kingfisher volume went from 18.6% to 13.5% of -0.3% output)
Slide 11: Operating profit impacts from strategic initiatives
Operating profit* impacts from strategic initiatives 2014 2015 Business and Board +£1.2m +£0.8m reorganisation Additional water -£0.5m -£0.5m recovery costs Increased investment -£0.3m in brand marketing Increased investment -£0.3m in property repairs and -£0.3m decorations * Before exceptional item
Slide 12: Exceptional items: No further costs expected on reorganisations
Exceptional items: No further costs expected on reorganisations 2014 2013 £m £m Business and Board reorganisation (0.5) (1.2) Share capital reorganisation (0.7) - Property impairment (0.1) - Total exceptional costs (1.3) (1.2) Property profits 0.2 0.3 No of pubs disposed 4 6 Total Exceptional Items
Slide 13: Balance Sheet strengthened through reduced debt and leverage
Balance Sheet strengthened through reduced debt and leverage 2014 2013 £m £m Fixed Assets 202.7 202.5 Other assets and Liabilities (2.4) 1.7 Net debt (71.5) (78.4) Shareholders Funds 128.8 125.8 Net Debt : EBITDA 3.5 4.0 Balance Sheet Gearing 56% 62% £60m term debt to 2026 remains fixed to end of
Slide 14: Jonathan Neame, Chief Executive
Jonathan Neame Chief Executive
Slide 15: Market context
Market context Marketplace has improved with total UK beer volume up 3.8% - greater consumer confidence - improved weather - lower taxation on beer Market for pubs has improved - drinkers and diners returning to pubs - atmosphere, product range and great fresh food key drivers - objective is to
Slide 16: Overview of 2014
Overview of 2014 A strong trading performance - record EBITDA and strong cash flow - strong growth in tenanted LFL EBITDAR and managed LFL sales - volume growth from core own and licensed beer excluding contract volume Good progress against strategy - Continued investment in estate and disposal
Slide 17: Our strategic objectives
Our strategic objectives ATTRACTING AND DRIVING RETAINING FOOTFALL TO CUSTOMERS TO OUR PUBS OUR QUALITY BEERS OUR STRATEGIC OBJECTIVES PROVIDING A ATTRACTING AND DISTINCTIVE RETAINING THE RANGE OF BEST PEOPLE COMPLEMENTARY PRODUCTS
Slide 18: Driving footfall to our pubs: Continued investment in improving the estate
Driving footfall to our pubs: Continued investment in improving the estate Managed Pubs and Hotels LFL Turnover growth 8.9% We have invested £5.1m (2013: 7.6% £4.6m) improving the look and feel of our pubs and £2.0m 3.3% (2013: £1.7m) in repairs and decorations. Total £7.1m (2013: £6.3m) 2012 2013
Slide 19: Driving footfall to our pubs: Hotel investment
Driving footfall to our pubs: Hotel investment Continued success of Marine Hotel following redevelopment in 2013 The Botany Bay Hotel and The Bell Hotel redeveloped in 2014 Royal Wells Hotel development due in 2015 at a cost of around £2m
Slide 20: Driving footfall to our pubs: Increase in investment in Tenanted estate
Driving footfall to our pubs: Increase in investment of £0.6m to £3.7m in Tenanted estate
Slide 21: Evolution of pub estate
Evolution of pub estate 2007 Acquisitions Transferred Disposals 2014 Tenanted 328 21 12 (62) 299 Managed 49 11 (12) 0 48 Total 377 32 0 (62) 347 87% freehold 100% in London and the South East
Slide 22: Attracting and retaining the best people
Attracting and retaining the best people Improvements in recruitment and induction process Greater investment in bespoke training and business support Flexible agreements, good commercial propositions Matched investment schemes Resulting in - Tenanted applications up - Tenanted estate full
Slide 23: Providing a distinctive range of complementary products: leveraging retail skills
Providing a distinctive range of complementary products: leveraging retail skills Continued focus on food offer through food development team - We influence > 100 Tenanted sites New Coffee and Ale House brand launched - Improved machines, ingredients, quality audits Wine list strengthened, aro
Slide 24: Strong managed pubs and hotel performance
Providing a distinctive range of complementary products: Strong managed pubs and hotel performance Food LFL +10.4% (2013: +5.0%) - Footfall +8.3% - Spend per head £11.48 (2013: £11.23) Increased accommodation marketing Accommodation LFL +9.7% (2013: +7.9%) - Occupancy 76% (2013: 73%) - RevPAR
Slide 25: Attracting and retaining customers to our quality beers
Attracting and retaining customers to our quality beers Successful re-launch of Whitstable Bay range Re-launch of seasonal ale range Occasional and event beers launched under No 18 Yard Brewhouse branding Phased exit from contract brewing to focus production on core own and licensed brands
Slide 26: Evolution of beer portfolio
Attracting and retaining customers to our quality beers: Evolution of beer portfolio Heritage Core Discovery Growth Growth Growth +7.7% +1.1% +0.1% New Developments 2015
Slide 27: Increased investment in brand activity
Attracting and retaining customers to our quality beers: Increased investment in brand activity Increase in marketing spend of £0.3m behind Armstrong and Miller Increased digital and social media presence KNDL deal has enabled geographical expansion National sales force strengthened and Head
Slide 28: Summary and current trading
Summary and current trading Strong trading year Cost saving from reorganisations reinvested Good start to new year against very strong comparable period - Tenanted LFL EBITDAR to 30 August 2014 up 2.6% - Managed house LFL sales to 6 September 2014 up 4.1% - Total beer volume to 6 September 201
Slide 29: Strategic overview: positioning for future growth
Strategic overview: positioning for future growth Strong pipeline of development opportunities in existing Tenanted and Managed estate Further growth potential from recent investments Pursue economic single site opportunities Beer portfolio aligned to marketplace Focus on development of co
Slide 30: Questions?
9} SHEPHERD NEAME Questions?
Slide 31: Resolutions
SHEPHERD NEAME Resolutions
Slide 32: Resolution 1: To receive the Annual Report and Accounts
Resolution 1 To receive the Annual Report and Accounts
Slide 33: Resolution 1 voting results
Resolution 1 To receive the Annual Report and Accounts No of No of Shareholders Votes % For + Discretion 293 3,300,599 93.63 Against 0 0 0 Other Discretion 19 224,465 6.37 100.00 Withheld 0 0 23.68% of total votes cast by proxy
Slide 34: Resolution 2: To declare a final dividend
Resolution 2 To declare a final dividend
Slide 35: Resolution 2 voting results
Resolution 2 To declare a final dividend No of No of Shareholders Votes % For + Discretion 293 3,300,599 93.63 Against 0 0 0 Other Discretion 19 224,465 6.37 100.00 Withheld 0 0 23.68% of total votes cast by proxy
Slide 36: Resolution 3: Re-election of Mr N J Bunting
Resolution 3 To propose the re-election of Mr N J Bunting as a Director
Slide 37: Resolution 3 voting results
Resolution 3 To propose the re-election of Mr N J Bunting as Director No of No of Shareholders Votes % For + Discretion 290 3,284,359 93.18 Against 2 16,000 0.45 Other Discretion 19 224,465 6.37 100.00 Withheld 2 240 23.68% of total votes cast by proxy
Slide 38: Resolution 4: Re-election of Mr J H Leigh-Pemberton
Resolution 4 To propose the re-election of Mr J H Leigh-Pemberton as a Director
Slide 39: Resolution 4 voting results
Resolution 4 To propose the re-election of Mr J H Leigh-Pemberton as a Director No of No of Shareholders Votes % For + Discretion 285 3,267,396 92.78 Against 4 29,914 0.85 Other Discretion 19 224,465 6.37 100.00 Withheld 6 3,289 23.68% of total votes cast by proxy
Slide 40: Resolution 5: Re-election of Mr O W A Barnes
Resolution 5 To propose the re-election of Mr O W A Barnes as a Director
Slide 41: Resolution 5 voting results
Resolution 5 To propose the re-election of Mr O W A Barnes as a Director No of No of Shareholders Votes % For + Discretion 286 3,265,965 92.78 Against 4 29,608 0.84 Other Discretion 19 224,465 6.38 100.00 Withheld 5 5,026 23.68% of total votes cast by proxy
Slide 42: Resolution 6: Re-election of Mr M H Templeman
Resolution 6 To propose the re-election of Mr M H Templeman as a Director
Slide 43: Resolution 6 voting results
Resolution 6 To propose the re-election of Mr M H Templeman as a Director No of No of Shareholders Votes % For + Discretion 287 3,268,075 92.78 Against 5 29,808 0.85 Other Discretion 19 224,465 6.37 100.00 Withheld 3 2,716 23.68% of total votes cast by proxy
Slide 44: Resolution 7: Re-appoint Deloitte LLP as Auditor
Resolution 7 To re-appoint Deloitte LLP as the Auditor and authorise the Directors to fix their remuneration
Slide 45: Resolution 7 voting results
Resolution 7 To re-appoint Deloitte LLP as the Auditor and authorise the Directors to fix their remuneration No of No of Shareholders Votes % For + Discretion 283 3,277,725 93.15 Against 7 16,666 0.47 Other Discretion 19 224,465 6.38 100.00 Withheld 4 6,008 23.68% of total votes cast by proxy
Slide 46: Resolution 8: Authority for market purchases of ordinary shares
Resolution 8 To authorise the Company to make market purchases of ordinary shares of 50p each
Slide 47: Resolution 8 voting results
Resolution 8 To authorise the Company to make market purchases of ordinary shares of 50 pence each No of No of Shareholders Votes % For + Discretion 279 3,270,146 92.96 Against 12 23,326 0.66 Other Discretion 19 224,465 6.38 100.00 Withheld 4 7,127 23.68% of total votes cast by proxy