Fuller, Smith & Turner P.l.c. Class A · LSE:FSTA
Fuller, Smith & Turner P.l.c. Class A — FY2022 Earnings Presentation
34 slides from Fuller, Smith & Turner P.l.c. Class A's earnings presentation, June 2022
Slide 1: Full Year Results for the 52 weeks ended 26 March 2022
Full Year Results for the 52 weeks ended 26 March 2022
Slide 2: Agenda
Agenda 2 THE LONG-TERM VIEW F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 CURRENT TRADING FINANCIAL REVIEW S T R AT E G Y I N D E TA I L SUMMARY Celebrating The Queen’s Platinum Jubilee in style
Slide 3: The Long-Term View
3 THE LONG-TERM VIEW • Predominately freehold-backed company with over 175 years of history and experience ▪ Completed Directors’ revaluation exercise – valuing estate at £995.6m F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 • High-quality, premium estate, geo
Slide 4: Current Trading
CURRENT TRADING 4 To t a l s a l e s ( £ 0 0 0 s ) • Real momentum in the run up to Christmas with strong sales in the first two weeks of December 6,500 • Omicron variant resulted in the implementation 6,000 of Plan B on 8 December 2021, which had a 5,500 negative impact on sales as people sheltered
Slide 5: Time Well Spent Building for the Future
TIME WELL SPENT BUILDING FOR THE FUTURE 5 • Maintained investment in estate – including winterisation of gardens and a number of transformational refurbishments • New Employer Brand – supported with employee engagement survey, improved communications, new benefits package and recruitment platform F
Slide 6: Financial Review
6 F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 FINANCIAL REVIEW Kingsley – Chief Cocktail Maker at The Saint, Bow Churchyard Holding court and quenching the thirsts of City workers in the Square Mile
Slide 7: Income Statement
INCOME STATEMENT 7 FY 2022 FY 2021 C O M M E N TA RY £m £m • Revenues recovering despite year starting with all pubs closed, Revenues 253.8 73.4 outside areas only open from 12 April 2021, inside with restrictions from 17 May 2021 and full restrictions only lifted on 19 July 2021 Operating costs (23
Slide 8: Divisional Results
DIVISIONAL RESULTS 8 FY 2022 FY 2021 C O M M E N TA RY £m £m • Managed Pubs and Hotels delivered £228.8m of Managed Pubs and Hotels revenue and operating profit of £24.7m despite the Revenue 228.8 64.0 first four months being impacted with lockdowns and restrictions and Christmas heavily affected by
Slide 9: Managed Revenue Analysis
MANAGED REVENUE ANALYSIS 9 FY 2022 FY 2021 C O M M E N TA RY £m £m • 58% of Managed sales are from drink sales – Drink 132.8 32.2 which were most impacted by lockdowns and Food 72.6 24.6 restrictions Accommodation 21.9 5.8 F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H
Slide 10: The Inflationary Environment
THE INFLATIONARY ENVIRONMENT 10 Current challenges: Mitigating factors: • Industry-leading benefits package • Investment in home-grown talent • New recruitment system launched Labour • Continued commitment to apprentices F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2
Slide 11: Central Infrastructure
CENTRAL INFRASTRUCTURE 11 C O M M E N TA RY FY 2022 FY 2021 • Successful implementation of new Microsoft £m £m Business Central finance system. Implemented Staff costs 9.6 7.5 in November 2021 with no issues and enabling improved management information to allow for F U L L Y E AR R E S U L T S F O R
Slide 12: Strong Balance Sheet
STRONG BALANCE SHEET 12 FY 2022 C O M M E N TA RY £m • High quality asset base Property, plant & equipment 592.7 Right-of-use assets (IFRS 16) 73.8 • 92% of Fuller’s estate is freehold by book value • Property portfolio was last revalued in 1999 F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S
Slide 13: Strong Asset Backing: Directors' Portfolio Valuation
STRONG ASSET BACKING 13 Directors’ portfolio valuation Directors’ valuation Independent validation • Standard valuation methodology, using projected • Fleurets were engaged to provide a valuation for 20% of F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 cashflo
Slide 14: Strong Asset Backing: Directors' Portfolio Valuation
STRONG ASSET BACKING 14 Directors’ portfolio valuation The valuation of the total estate is £995.6m which compares to the historical net book value of the estate included within the accounts of £592.7m £400m uplift in property value has significant impact on balance sheet Updated All numbers as at 2
Slide 15: Net Debt
15 NET DEBT • Net debt at 26 March 2022 of £131.9m excluding Net debt leases (27 March 2021: £218.1m) CCFF • Bank facilities of £192m, £26m of debentures. Total Drawn bilateral loans £218m as at year end Debentures and pref shares F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6
Slide 16: Cashflow
CASHFLOW 16 FY 2022 FY 2021 C O M M E N TA RY £m £m • Steady improvement in trading resulting in much Adjusted EBITDA 44.3 (13.1) improved EBITDA of £44.3m, despite only being fully Working capital 27.8 (5.1) opened from 19 July 2021 and the severe impact of Omicron Interest (7.2) (4.5) F U L L Y E
Slide 17: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK 17 Policy Targets & Philosophy Outlook • Outlook - annual investment of £10-15m on Invest in long-term Returns-based approach to capital maintenance capex and £10-15m on trade organic growth investment enhancing capex F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K
Slide 18: FY23 Guidance
FY23 GUIDANCE 18 • Continued recovery of managed revenues • Margin pressures from inflation • Depreciation expected to be in the region of £25m F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 • Interest charge expected to be in the region of £10m • Adjusted effe
Slide 19: Strategy in Detail
19 F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 STRATEGY IN DETAIL The Jack Horner Sits on the corner of Tottenham Court Road and Bayley Street in London’s West End
Slide 20: Building on Our Strengths
BUILDING ON OUR STRENGTHS 20 Strengths • An outstanding predominately freehold estate that is well-invested, geographically balanced and in excellent condition • A cash generative business driven by an iconic Managed business and F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M
Slide 21: A Clear Strategy
A CLEAR STRATEGY Our Purpose We create experiences that nourish the soul F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 Our Strategic Pillars • Delight our customers • Inspire our people • Enhance our estate • Evolve our business • Own our impact because Life i
Slide 22: Delight Our Customers
DELIGHT OUR CUSTOMERS 22 Objective • Surprise and delight with distinctive service • Tailor the experience in every pub and hotel • Create a smoother customer journey F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 • Attract new customers and increase visit freq
Slide 23: Inspire Our People
INSPIRE OUR PEOPLE 23 Objective • Create a workplace where everyone feels they belong • Appreciate and value our colleagues • Support and encourage career development F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 • Attract the best talent We will do this by… •
Slide 24: Enhance Our Estate
ENHANCE OUR ESTATE 24 Objective • To buy, invest and maximise the performance of iconic properties that add long-term value to our property portfolio • Evolve our estate through transformational investment and refurbishments F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C
Slide 25: Property Pipeline
PROPERTY PIPELINE • Opened The Saint, Bow Churchyard • Conversion of The Red Lion, • Transformational scheme at The Plough, East Sheen, formerly a Tenanted Inn Wendover to Bel & The Dragon • Conversion and reopening of The George & Dragon Westerham as our eighth • Transformational scheme at The Bel
Slide 26: Evolve Our Business
EVOLVE OUR BUSINESS 26 Objective • Innovate to excite future customers • Grow our profitability • Enhance our supplier partnerships F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 We will do this by… • Rebranding our identity in line with our position as a leadi
Slide 27: The Digital Customer Journey
THE DIGITAL CUSTOMER JOURNEY Customer Acquisition In Venue Post Visit Find new customers Search through SCV data Websites: Single (building automated WiFi F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 Fullers.co.uk like-minded Bel & The Dragon Customer View So
Slide 28: Own Our Impact Because Life Is Too Good to Waste
OWN OUR IMPACT BECAUSE Life is too good to waste 28 Objective • Take action to protect and respect our planet • Create spaces for communities to connect and feel welcome • Care for our people and foster a sense of belonging F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C
Slide 29: Tenanted Inns
TENANTED INNS 29 • We value the ownership of our Tenanted Inns division • It is an integral, highly profitable and cash generative part of our business • A symbiotic relationship with both parts of the business benefiting F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H
Slide 30: Summary
SUMMARY 30 • Our strategy, vision and purpose has evolved to reflect changing consumer and economic environments • We have a strong Balance Sheet, further enhanced by refinancing our bank facilities • The last two years have been used wisely, investing in F U L L Y E AR R E S U L T S F O R T H E 5 2
Slide 31: Fuller's first Bridge Walk
Fuller’s first Bridge Walk – over 80 team members raised a collective total in excess of £25,000 for Special Olympics GB
Slide 32: Appendix: Fuller's Estate
Appendix: Fuller’s Estate 32 27 Mar 26 Mar 8 June Within 2021 New Disposed Transfers 2022 Transfers 2022 the M25 Total Fuller’s 386 1 (2) - 385 - 385 44% Managed Pubs & Hotels 211 1 (2) 1 211 (4) 207 57% F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 Tenanted I
Slide 33: Appendix: IFRS 16 reconciliation
Appendix: IFRS 16 reconciliation 33 Pre IFRS 16 IFRS 16 Post IFRS 16 Revenue and other income 253.8 - 253.8 F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 Operating costs (237.6) 2.3 (235.3) Adjusted operating profit 16.2 2.3 18.5 Finance costs (8.2) (3.1) (11.
Slide 34: Appendix: A geographically balanced business
F U L L Y E AR R E S U L T S F O R T H E 5 2 W E E K S E N D E D 2 6 M AR C H 2 0 2 2 34 Appendix: A geographically balanced business
Fuller, Smith & Turner P.l.c. — FY2022 Earnings Presentation on 6ix