Slide 1: J.D. Wetherspoon Plc Interim Announcement
J.D. Wetherspoon Plc Interim Announcement 7 March 2003
Slide 2: Highlights - Six Months to 26 January 2003
Highlights -Six Months to 26 January 2003 • Turnover up 23% to £350.6m • Profits before tax up 3% to £25.6m • Earnings per share up 1% to 7.8p • Free cash flow per share 18.9p (+8%) - double EPS • Dividend per share increased by 10% to 1.21p
Slide 3: Openings - First Half 2003 (21)
Openings- First Half 2003 (21) M25 Midlands Area South West Croydon Birmingham Bridgewater Fulham Broadway Bridgnorth Plymouth Hammersmith Hereford Shepherds Bush Moseley Scotland Windsor North East Airdrie South Consett Kirkintilloch BasingstokeX2 Wales East Grinstead North West Aberdare Liverpool
Slide 4: Average Sales Per Pub Week (including VAT)
Average Sales Per Pub Week (including VAT) £000 27 25.9 24.7 25 23.5 22.7 23 20.4 21 19 17 15 1999 2000 2001 2002 2003 H1
Slide 5: Like For Like Sales
Like For Like Sales % H1 Year Year Year Year 2003 2002 2001 2000 1999 Bar 2.2 3.5 6.2 13.8 11.6 Food 14.0 9.9 11.4 8.1 (2.1) Total Sales 4.7 5.0 7.5 12.4 8.6 LFL Profits (2.6) 3.8 7.0 13.0 10.1
Slide 6: Trading
Trading • Wine - e.g. Coldwater Creek volumes • Coffee - 250,000 hot drinks per week • Children’s meals - 1 million per annum • Breakfasts - 2 million per annum • Real Ale • 10 am liquor licenses
Slide 7: People
People • Bonus payments • Lowest ever manager turnover • BII - Supreme Training Award (2 years running)
Slide 8: The Picturedrome, Liverpool
The Picturedrome, Liverpool
Slide 9: The Solomon Cutler, Birmingham
The Solomon Cutler, Birmingham
Slide 10: The King's Fee, Hereford
The King’s Fee, Hereford
Slide 11: Operating Margins - Summary
Operating Margins - Summary H1 H1 Year 2003 2002 2002 £000 % of £000 % of £000 % of Sales Sales Sales Turnover 350,606 - 285,178 - 601,295 - Pub Operating Profit 75,953 21.7 68,506 24.0 141,660 23.6 Sale & leaseback rentals (3,861) (1.1) (3,860) (1.3) (7,721) (1.3) Head Office Costs (15,771) (4.5) (
Slide 12: Pub Operating Margins
Pub Operating Margins H1 H1 Year 2003 2002 2002 Gross margin (PPS duty £5m – 0.7% sales) 62.2% 62.3% 62.5% Staff costs 24.5% 23.7% 23.9% Other pub costs (e.g. insurance/repairs) 16.0% 14.6% 15.0% Pub operating profit 21.7% 24.0% 23.6%
Slide 13: Pub Sales Performance
Pub Sales Performance • 2000/01 Pubs Sales £24.6k (+8%) • 2001/02 Pubs Sales £27.2k (+10%) • 2002/03 Pubs Sales £27.6k
Slide 14: Lloyds No. 1
Lloyds No. 1 • Original 10 - sales per week circa £30k • New Lloyds - sales per week circa £30k • First half 2003 openings 5 • Total estate 44 • Future development plans
Slide 15: Cash Flow
Cash Flow H1 H1 2003 2002 £000 £000 Cash from operations 62,395 54,355 +15% Interest and tax (12,537) (10,103) Investments in existing pubs (9,220) (7,121) Free cash flow available for 40,638 37,131 +9% new pub development Dividends (4,334) (2,810) Investment in own shares (153) - Issue of ordinary
Slide 16: Pub Investment Levels
Pub Investment Levels H1 2003 2002 2001 2000 1999 Capital re-invesment 2.6 2.5 3.3 3.9 3.3 Repairs 2.8 2.5 1.8 1.3 1.4 Total (% of sales) 5.4 5.0 5.1 5.2 4.7 Total (£k per pub) 62* 55 53 52 42 *H1 annualised
Slide 17: Financial - Funding
Financial - Funding H1 H1 Year 2003 2002 2002 Gearing (%) – post FRS19 97 93 98 – pre FRS19 82 79 82 Interest cover (times) 3.7 3.9 4.2 Fixed charge cover (times) - statutory 1.9 2.0 2.1 - excluding 2.6 2.7 2.8 depreciation
Slide 18: Underlying Economic Profits
Underlying Economic Profits H1 H1 Year 2003 2002 2002 £’000 £’000 £’000 PBT 25,611 24,885 53,568 Add: Depreciation 21,308 17,504 36,343 Less: Capital invested in existing pubs (9,220) (7,121) (18,726) Economic profit 37,699 35,268 +7% 71,185 Economic profit after tax on cash basis 32,469 31,281 +4%
Slide 19: Prospects
Prospects • February performance • Margin outlook • Property market • Competitive landscape • Continued expansion - circa 50 this year (but not a numbers game) • Minimal cash outflow (after expansion capital) • Cash/earnings outlook
Slide 20: Appendices
Appendices A - Financial Trends B - 10 Year Summary C - Capital trends
Slide 21: JDW - Financial Trends
Appendix A JDW - Financial Trends 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 H1 2003 Sales per pub (£000) 577 619 702 786 848 872 904 1,004 1,040 1,093 1,147 EBITDA per pub (£000) (1) 131.6 135.6 149.5 177.6 190.8 184.9 188.0 203.8 205.9 207.4 196.9 Average capital employed per pub (£000) 842
Slide 22: 10 Year Summary
Appendix B 10 Year Summary Average Sales Per Pub Week (including VAT) Number of Pubs £000 700 25.9 629 26 24.7 608 23.5 600 24 22.7 522 22 20.4 500 19.2 19.7 428 20 17.8 400 18 327 15.9 16 14 300 252 194 14 200 146 110 12 87 100 10 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003H1 0 53.6 1994 1995
Slide 23: Capital Trends
Appendix C Capital Trends 1998 1999 2000 2001 2002 2003(H1) Size (sq.ft.) – openings 3,401 3,037 3,217 3,713 3,808 3,862 Number of openings 68 84 101 94 87 21 % which are freehold 49 58 67 75 53 52 Freehold average cost (£k) 463 427 465 443* 500** 430 Average development cost (£k) 965 941 1,049 1,17