Slide 1: Preliminary Results 2015
2015 Preliminary Results John Hutson – CEO Ben Whitley – FD The Windmill, Airside, Stansted Airport, Stansted, Essex
Slide 2: Ben Whitley, Finance Director
The Old Borough, Swords, Co Dublin Ben Whitley Finance Director 11 September 2015
Slide 3: Financial Summary
Financial Summary 2015 2014 Revenue £1,513.9m £1,409.3m 7.4% Like-for-like sales +3.3% +5.5% Profit before tax £77.8m £79.4m -2.0% Earnings per share (including shares held in trust) 47.0p 47.0p Maintained Free cash flow per share 89.8p 74.1p 21.2% Dividend 12.0p 12.0p Maintained After Exceptional I
Slide 4: Average Weekly Sales Per Pub (including VAT)
Average Weekly Sales Per Pub (including VAT) £000 37.4 38 36.0 36 34.0 34 32.3 31.1 32 30.3 30.1 29.9 30.1 29.0 30 28 26 24 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 4
Slide 5: Earnings Per Share before exceptional items (pence)
Earnings Per Share before exceptional items (pence)* pence 47.0 47.0 50.0 44.8 45.0 39.8 40.0 36.0 34.1 32.6 35.0 28.1 27.6 30.0 24.1 25.0 20.0 15.0 10.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 *Including shares held in trust 5
Slide 6: Like-for-like Performance
Like-for-like Performance % 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Bar +1.2 +2.7 +3.8 +2.8 +1.7 -0.8 +2.5 -4.3 +3.3 +2.2 Food +7.3 +12.0 +10.9 +4.8 +4.2 +0.1 -0.4 +7.9 +12.6 +3.6 Machines -2.8 -3.1 +0.4 -2.8 -3.9 +12.1 -7.5 -5.8 +2.7 -1.4 LFL sales +3.3 +5.5 +5.8 +3.2 +2.1 +0.1 +1.2 -1.1
Slide 7: 10 Year Operating Profit
10 Year Operating Profit 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 £m £m £m £m £m £m £m £m £m £m Turnover 1,513.9 1,409.3 1,280.9 1,197.1 1,072.0 996.3 955.1 907.5 888.5 847.5 Pub profit (pre repairs) 285.4 284.4 259.0 245.4 226.8 218.5 208.4 199.5 203.2 195.3 Repairs (54.3) (59.4) (48.0) (4
Slide 8: Cost Increases
Cost Increases • Bar and food (modest) • Utility costs: +10% (price, consumption and carbon tax) • Hourly paid staff rates: +5% • Depreciation costs: +13% The Angel Vaults, Hitchin, Hertfordshire 8
Slide 9: Summary of exceptional items
Summary of exceptional items 2015 2014 £000 £000 Operating exceptional items Inventory valuation 5,231 – Restructuring costs 782 – 6,013 – Exceptional property losses Onerous lease provision 1,858 – Property impairment 11,195 – 13,053 – Other exceptional items Interest payable on gaming machine VAT
Slide 10: Allocation of Resources
Allocation of Resources £123m £161m £90m £59m £108m £164m £159m £117m £218m £201m £15m £24m £15m Dividend £22m £25m £5m £13m £10m £5m £15m FH reversions & £33m £8m investment £23m properties £7m £76m £15m Buybacks £26m £8m £78m £17m £154m £151m £12m £121m £113m Capex £10m £94m £75m £82m £61m £49m £3
Slide 11: Capital Expenditure
Capital Expenditure 2015 2014 £m £m New Openings: Acquisition and development costs Current year 76.5 64.5 Future year 30.5 33.2 Freehold reversions and investment properties 21.6 23.6 128.6 121.3 Reinvestment in existing pubs: Kitchen and bar equipment / furniture etc. 18.4 22.6 Refurbishments 19.2
Slide 12: Movement in Net Borrowings
Movement in Net Borrowings £m Free cash flow increased to £109.8m (2014: £92.9m) mainly due to lower interest costs, FY14 Net borrowings 556.6 corporation tax paid and expenditure on existing pubs Free cash flow (109.8) Disposal of fixed assets (0.7) Unutilised bank facilities and cash balances
Slide 13: 10 Year Debt Overview
10 Year Debt Overview 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Net debt/EBITDA 3.37 3.21 2.88 2.96 2.98 2.70 2.74 3.24 3.21 2.80 Interest cover (times) 2.73 3.11 2.66 2.68 2.73 3.08 2.43 2.71 3.13 3.31 Interest cover pre 3.29 3.19 3.24 3.07 2.88 3.45 3.14 2.81 3.13 3.31 exceptional (times)
Slide 14: John Hutson, CEO
John Hutson CEO The Saltoun Inn, Fraserburgh, Aberdeenshire
Slide 15: Property Update
Property Update • Average cost of development £2.07m, compared to £1.64m last year. 2015 2014 • Four of the new openings include hotel accommodation Trading pubs at start of FY 927 886 • Average size of new pubs 20% larger than Freehold pubs opened 24 31 previous year Leasehold pubs opened 6 15 • In
Slide 16: "It's a People Thing"
“It’s a People Thing” • More than 36,000 employees at the end of financial year (2007: 20,588) • Created over 15,500 jobs since the start of the credit crunch and over 2,000 jobs in the last year • Dedicated employee website & e-learning suite • Catering Academy – 618 employees have graduated with 3
Slide 17: Changing Sales Mix over Last 13 Years
Changing Sales Mix over Last 13 Years 100.0% 0.4% 0.5% 0.7% 4.8% 4.5% 3.0% Other 90.0% 23.2% Machines 80.0% 29.4% 37.0% 70.0% Food 60.0% 50.0% Bar 40.0% 71.6% 30.0% 65.6% 59.3% 20.0% 10.0% 0.0% FY 2003 FY 2008 FY 2015 17
Slide 18: Peach BrandTrack: Britain's favourite big brand
Peach BrandTrack: Britain’s favourite big brand If the following brands were available in the same location, which would be your first choice to eat at? (ranked by % of adults choosing each brand) (out of a list of 17 – the top 6 ) Apr-15 Oct-14 Apr-14 Oct-13 Apr-13 Oct-12 May-12 Wetherspoon 12% 13%
Slide 19: Successes and achievements
Successes and achievements • 296 pubs are in the 2016 CAMRA Good Beer Guide • Raised over £1.7m in the last 12 months and over £11.0m during the 13 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 dia
Slide 20: Cost Outlook
Cost Outlook • Wages • Utilities • Repairs • Bar and food supplies The North Western, Liverpool, Merseyside 20
Slide 21: Taxation
Taxation 2015 £m 2014 £m VAT 294.4 275.1 Alcohol duty* 161.4 157.0 PAYE and NIC 84.8 78.4 Business rates 48.7 44.9 Corporation tax 13.3 18.1 Machine duty 11.2 11.3 Climate change levies 6.4 6.3 Carbon tax 3.7 2.7 Fuel duty 2.9 2.1 Landfill tax 2.2 1.5 Stamp duty 1.8 2.1 Premise licence and TV licenc
Slide 22: Current Trading and Outlook
Current Trading and Outlook • LFL sales for the six weeks to 6th September increased by 1.4% with total sales increasing by 5.2%. • Cost increases • Competition from supermarkets and restaurant groups • Future opportunities • We continue to anticipate a trading performance similar to, or slightly ab
Slide 23: Questions
wetherspoon Questions CRAFTWOR 23
Slide 24: Appendix
The Saxon Crown, Corby, Northamptonshire Appendix
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 • E Cash flow • F Swap maturity profile 25
Slide 26: 10 Year Overview
Appendix A 10 Year Overview Number of pubs £000 Average gross sales per pub week 38.0 1000 950 36.0 900 34.0 850 32.0 800 37.4 927 951 36.0 30.0 750 886 34.0 860 823 32.3 700 28.0 31.1 775 30.3 30.1 29.9 30.1 731 29.0 650 657 671 694 26.0 600 24.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 20
Slide 27: 10 Year Capital Trends
Appendix B 10 Year Capital Trends 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Average Size (sq.ft.) – 4,321 3,585 3,643 3,325 3,572 3,781 3,359 3,618 3,855 3,928 Openings Number of openings 30 46 29 40 50 47 39 23 18 9 % which are freehold 80 67 48 45 68 32 33 57 61 22 Freehold average cost 84
Slide 28: 10 Year Financial Trends
Appendix C 10 Year Financial Trends 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Sales per pub (£000) 1,620 1,562 1,476 1,401 1,360 1,335 1,344 1,333 1,354 1,283 EBITDA per pub (£000) (1) 200.9 204.5 200.9 194.9 198.7 205.8 212.9 211.6 219.0 205.6 Number of pubs 951 927 886 860 823 775 731 694
Slide 29: ROC/CROCCE/ROE
Appendix D1 ROC/CROCCE/ROE 2015 2014 £000 £000 Shareholders equity per accounts 222,893 227,168 Deferred tax balances 69,776 77,651 Interest rate swaps valuations 39,973 30,166 Impairment balances 49,769 39,071 Net book value of revalued assets (7,244) (7,963) Adjusted shareholders equity (a) 375,16
Slide 30: ROC/CROCCE/ROE
Appendix D2 ROC/CROCCE/ROE 2015 2014 £000 £000 EBITDA (cash return) (d) 178,482 173,650 Depreciation and amortisation (e) (66,668) (58,075) EBIT (f) 111,814 115,575 Interest (34,016) (36,213) Profit before tax 77,798 79,362 Current tax (g) (21,544) (17,004) Profit after cash tax (h) 56,254 62,358 De
Slide 31: Cash Flow
Appendix E Cash Flow 2015 2014 £000 £000 Free Cash Flow 109,778 92,850 Proceeds on Disposal 723 505 Investment in new pubs (106,974) (97,704) Freehold reversions & investment properties (21,612) (23,577) HMRC – Rank Claim Repayment - (16,696) Dividends (14,591) (14,949) Share Buy Backs (12,714) (24,
Slide 32: Swap Maturity Profile
Appendix F Swap Maturity Profile Swap Value From To Weighted Average % £400m 12 Nov 2014 31 Jul 2016 3.5% £400m 31 Jul 2016 31 Jul 2018 2.2% £400m 31 July 2018 31 July 2021 3.7% £150m 31 July 2021 31 July 2023 3.8% 32
Slide 33: Forward-looking statements disclaimer
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-looking statements involve known a