Fuller, Smith & Turner P.L.C. Class A · LSE:FSTA
Fuller, Smith & Turner P.L.C. Class A — FY2006 Earnings Presentation
39 slides from Fuller, Smith & Turner P.L.C. Class A's earnings presentation, June 2006
Slide 1: Fuller, Smith and Turner PLC Preliminary Results
photo Fuller, Smith and Turner PLC Preliminary Results for the 52 Weeks Ended 1st April 2006
Slide 2: Michael Turner, Chief Executive
Michael Turner Chief Executive
Slide 3: Agenda
Agenda Strategy Corporate Progress Key Financial Data Fuller’s Inns The Fuller’s Beer Company Prospects
Slide 4: Consistent Strategy
Consistent Strategy Fundamental objective to maximise shareholder returns by generating high quality, sustainable earnings • Long term focus • Culture of style not fashion • Passion for quality • Pride in our premium brands • Continuing steady growth across the estate
Slide 5: A Year of Change
A Year of Change • Good underlying performance in core businesses • Results are for 52 weeks compared to 53 last year • On 2 December 2005 acquired George Gale & Company Ltd for £91.8m including the cost of debt • Gales trading since acquisition is included in results • Gearing up from 14.7% to 83.5
Slide 6: Corporate Progress
Corporate Progress • Beer Company profits up 6% • Excellent performance from Managed Pubs with profits up 30% • Managed Pubs LFL sales up 3.6% • Tenanted Inns profits up an impressive 26% • A good performance from Hotels with trading profits up 8% • Interest costs up £2.2m
Slide 7: Acquisition Update
Acquisition Update • Business integration complete • Gales beers now brewed successfully in Chiswick • Horndean brewery closed and decommissioned • Gales has been earnings enhancing in first four months even after financing costs • Annual synergies of £3.5m exceeding initial expectations by £0.5m
Slide 8: Financial Highlights
Financial Highlights • Turnover up 12% to £145.1m (2005: £129.5m) • Pre-exceptional EBITDA up 14% to £32.1m (2005: £28.2m) • Adjusted* profits before tax up 5% to £18.7m (2005: £17.8m) • Exceptional integration costs £2.9m • Statutory profits after exceptionals down 13% to £15.3m (2005: £17.6m) • Ad
Slide 9: Adjusted Profits
Adjusted Profits Pre IFRS & Exceptional Items 20 18.7 17.8 15 16.4 16.9 £m 14.9 10 5 -2% +10% +3% +6% +5% 0 2002 2003 2004 2005 2006
Slide 10: Adjusted EPS
Adjusted EPS Pre IFRS & Exceptional Items 60 50 56.58 53.13 Pence per share 49.84 40 45.59 40.07 30 20 10 -6% +14% +9% +7% +6% 0 2002 2003 2004 2005 2006
Slide 11: Full Year Dividend
Full Year Dividend 20 19.75 18.46 17.31 Pence per share 15 16.12 15.17 10 5 +5% +6% +7% +7% +7% 0 2002 2003 2004 2005 2006
Slide 12: Paul Clarke, Finance Director
Paul Clarke Finance Director
Slide 13: Financial Strengths
Financial Strengths • Good cash generation combined with high quality asset base • Significant banking interest to provide acquisition finance • Strong balance sheet underpins cash acquisition • Focus on earnings growth • Strategy delivering significant shareholder returns
Slide 14: Key Figures
Key Figures Reported & restated under IFRS 2006 2006 2005 2005 Net Debt £130.0m £22.4m Gearing 83.5% 14.7% Net Assets £155.7m £152.3m Net Assets Per Share £6.97 £6.81 EBITDA* £32.1m £28.2m Interest Cover* 5.0x 8.6x Effective Tax Rate* 31.9% 32.7% ** Based Based on on pre-exceptional pre-exceptional
Slide 15: Statutory Profit Reconciliation
Statutory Profit Reconciliation 2006 2006 2005 2005 £m £m £m £m Adjusted profits 18.7 17.8 IFRS adjustments (0.7) (0.4) Preference dividends (0.1) - Exceptional profits on disposals 0.3 0.2 Gales integration costs (2.9) - Statutory pre-tax profit 15.3 17.6
Slide 16: Total Capital Expenditure
Total Capital Expenditure Excluding Gales Acquisition 35 30.6 30.6 30 26.2 26.2 25 18.3 17.5 17.5 Fuller’s Inns 18.3 £m 20 15 Beer Company 12.0 12.0 10 and Central 5 0 2002 2003 2004 2005 2006
Slide 17: Simon Emeny, Retail Director
Simon Emeny Retail Director
Slide 18: Fuller's Inns Key Figures
Fuller’s Inns Key Figures 2006 2006 2005 2005 Change Change Turnover £111.9m £98.7m + 13 % Profit (pre IFRS) £19.1m £15.9m + 21 % Profit (post IFRS) £19.0m £15.9m + 20 % EBITDA £26.2m £22.2m + 18 %
Slide 19: Retail Split
Retail Split April April Transfers Transfers Additions Additions Disposals Disposals Gales Gales April April 2005 2005 2006 2006 Managed Pubs 118 -3 8 -2 42 163 Tenanted Inns 118 3 2 69 192 Hotels 8 8 244 0 10 -2 111 363
Slide 20: Managed Pubs
Kia a =, Managed Pubs a
Slide 21: Managed Pubs
Managed Pubs Trading Patterns Excluding Gales • Turnover for the year up 5% with profits up 11% • Uninvested LFL turnover up 3.6% • Reaping rewards of a clear strategy: –– Food Food sales sales up up 13% 13% –– Cask Cask ale ale sales sales up up 8% 8% –– Wine Wine sales sales up up 8% 8% • Eight ne
Slide 22: Tenanted Inns
‘ 4 “= * Tenanted Inns Tmtces ‘.. \ #5 ~ ne
Slide 23: Tenanted Inns
Tenanted Inns Trading Patterns Excluding Gales • Another good year for Tenanted Inns • Turnover up 5% • Profits pre interest up 8% • Two acquisitions and three transfers from Managed estate made during the year
Slide 24: Fuller's Hotels
Fuller’s Hotels • Good performance with trading profits up 8% • Chamberlain, Brigstow and White Hart maintain strong growth • Red Lion in Hillingdon performing well
Slide 25: Fuller's Hotels Key Figures
Fuller’s Hotels Key Figures 2006 2006 2005 2005 Change Change No. of Rooms 513 513 level Room Rates £70.56 £68.35 +3% Occupancy 65% 62% +4% RevPar £45.62 £42.50 +7%
Slide 26: Gales
BA ee Cell | ld bits of pains? = SR ; - ies i
Slide 27: The Gales Acquisition
The Gales Acquisition • Excellent geographic fit • Good demographic area • Large proportion of sites with outside trading areas • High food mix at 40% • Opportunities for growing cask ale and wine sales • Maximising synergies of an efficient head office team
Slide 28: Fuller's Inns Summary
Fuller’s Inns Summary A strong year for the division with profits for the year up 21% • Estate has grown by 119 pubs since last year • Managed Pubs LFL turnover up 3.6% • Tenanted Inns continue to perform well with profits up 26% • A good year for Hotels with trading profits up 8% • Gales pubs fully
Slide 29: John Roberts, Beer and Brands Director
John Roberts Beer and Brands Director
Slide 30: Fuller's Beer Company Key Figures
Fuller’s Beer Company Key Figures 2006 2006 2005 2005 Change Change Turnover* £51.3m £46.0m + 11 % Profit (pre IFRS) £8.7m £8.2m +6% Profit (post IFRS) £8.4m £8.2m +3% EBITDA £10.2m £9.7m +5% ** Excludes Excludes excise excise duty duty
Slide 31: Beer Volumes
Fuller’s Beer Company Beer Volumes (52 weeks v 53 weeks) 2006 2006 2005 2005 change change ‘000 ‘000 brls brls ‘000 ‘000 brls brls Free On Trade 146.6 146.1 level Fuller’s Inns 94.4 86.4 +9% Off Trade 29.8 30.1 -1% Exports 13.8 12.5 + 10 % Total Beer 284.6 275.1 +3% Own Beer 197.4 197.9 level
Slide 32: London Pride
London Pride • The UK’s leading premium ale • Increased market share • Creative marketing initiatives continue • Widely available at Lord’s
Slide 33: Discovery Blonde Beer
Discovery Blonde Beer • Major brand launched in May 2005 • Excellent first year • Attracting lager drinkers in pubs • Well set for further growth in 2006
Slide 34: Other Brands
Other Brands • Organic Honey Dew is the UK’s leading organic beer and continues to grow strongly • ESB and Vintage Ale both win gold medals in Beer World Cup Awards
Slide 35: The Gales Acquisition
The Gales Acquisition • Gales operational integration complete • Gales beers now brewed successfully in Chiswick • Distribution hub retained in Horndean • Expanded Free Trade area with considerable potential • Exciting opportunities for our successful Wine Division • Gales brands now part of Fuller’
Slide 36: Fuller's Beer Company Summary
Fuller’s Beer Company Summary A good performance with profits up 6% • Market share continues to increase • The Wine Division strong performance continues with profits up 15% • Continued investment in brands and the Brewery • Exciting opportunities in Gales trading area
Slide 37: The Publican Awards 2006 Regional Brewer of the Year
The Publican Awards 2006 Regional Brewer of the Year
Slide 38: Prospects
Prospects • All areas of the business performing well • Gales integration complete • Expected synergies of £3.5m • Gales acquisition an excellent strategic fit • Continued organic investment in pub estate • Continuing to increase shareholder value
Slide 39: Whatever You Do, Take Pride
WHATEVER YOU DO, TAKE PRIDE.
Fuller, Smith & Turner — FY2006 Earnings Presentation on 6ix