Slide 1: Interim Presentation 15 March 2019
wetherspoon tin The'Palladium, Llandudno ’ " INTERIM PRESENTATION 15 MARCH 2019 John Hutson — CEO Ben Whitley — FD
Slide 2: Financial Summary
Financial Summary H1 H1 2019 2018 Var% 2018 20172 2016 2015 2014 2013 20122 2011 2010 2009 Revenue 889.6 830.4 +7.1% 1,693.8 1,660.8 1,595.2 1,513.9 1,409.3 1,280.9 1,197.1 1,072.0 996.3 955.1 (£m) Like-for-like sales +6.3% +6.1% +5.0% +4.0% +3.4% +3.3% +5.5% +5.8% +3.2% +2.1% +0.1% +1.2% Profit bef
Slide 3: Average Weekly Total Sales Per Pub
Average Weekly Total Sales Per Pub (including VAT) £000 46.8 48 46 44.4 43.4 44 41.7 42 39.0 40 37.4 38 36.0 36 34.0 34 32.3 31.1 32 29.9 30.1 30 28 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1 H1 2018 2019 2
Slide 4: Underlying Earnings Per Share
Underlying Earnings Per Share* pence 76.5 80 75 70 66.6 65 60 55 48.0 47.6 50 44.7 43.8 44.1 41.3 45 40 34.9 35.3 33.9 32.6 35 30 25 20 15 10 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1 H1 2018 2019 *Underlying earnings per share are before exceptional items and exclude gains/losses on prop
Slide 5: Like-for-like Performance
Like-for-like Performance H1 H1 % 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Bar +5.9 +5.7 +5.1 +3.1 +3.3 +1.2 +2.7 +3.8 +2.8 +1.7 -0.8 +2.5 Food +7.1 +6.9 +5.1 +5.7 +3.5 +7.3 +12.0 +10.9 +4.8 +4.2 +0.1 -0.4 Fruit/slot +5.7 +4.6 +2.9 -1.2 -2.2 -2.8 -3.1 +0.4 -2.8 -3.9 +12.1 -7.5 mac
Slide 6: 10 Year Operating Profit
10 Year Operating Profit H1 H1 £m 2019 2018 2018 20171 2016 2015 2014 2013 20121 2011 2010 2009 Turnover 889.6 830.4 1,693.8 1,660.8 1,595.2 1,513.9 1,409.3 1,280.9 1,197.1 1,072.0 996.3 955.1 Pub profit (pre repairs) 169.6 170.1 338.6 330.6 288.3 285.4 284.4 259.0 245.4 226.8 218.5 208.4 Repairs (3
Slide 7: Half Year Cost Increases
Half Year Cost Increases • Wages: +12.8% (+£33.0m) • Utilities : +9.9% (+£2.5m) • Repairs: +11.6% (+£3.7m) • Interest: +24.4% (+£3.3m) • Depreciation: +6.3% (+£2.4m) Robert Shaw, Westhoughton 6
Slide 8: Allocation of Resources
Allocation of Resources Dividend £13m Freehold reversions and investment properties £15m Share buybacks £24m £15m £13m £14m Capex on new and existing pubs £22m £16m £89m £25m £5m £36m £5m £13m £15m £8m £52m £33m £8m £23m £11m £54m £28m £15m £26m £8m £8m £52m £154m £151m £52m £121m £115m £10m £113m £
Slide 9: Cash Capital Expenditure
Cash Capital Expenditure H1 H1 £m 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 New Openings: Acquisition and development costs: Current year 4.3 12.1 32.0 27.2 38.6 76.5 64.5 40.4 57.2 74.0 45.2 32.0 Future year 11.0 15.5 14.4 13.1 16.6 30.5 33.2 12.8 10.4 9.0 12.5 5.8 Freehold revers
Slide 10: Movement in Net Debt
Movement in Net Debt H1 H1 £m 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Opening Net Debt 726.2 696.3 696.3 650.8 601.1 556.6 474.2 462.6 437.7 388.4 390.0 442.3 Free cash flow (71.7) (36.8) (93.4) (107.9) (90.5) (109.8) (92.9) (65.3) (91.5) (78.8) (71.3) (99.5) Disposal of fixed as
Slide 11: 10 Year Debt Overview
10 Year Debt Overview H1 H1 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Net debt/EBITDA 3.47 3.48 3.39 3.39 3.47 3.37 3.21 2.88 2.96 2.98 2.70 2.74 (EBITDAR - Reinvestment)/Fixed charges 2.25 2.46 2.25 2.21 2.14 1.97 1.79 1.88 1.75 1.74 2.01 2.14 Interest cover (times) 3.87 4.98 4.19
Slide 12: Property Update
Property Update H1 H1 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Trading pubs at start of FY 883 895 895 926 951 927 886 860 823 775 731 694 Freehold pubs opened 1 3 6 9 10 24 31 14 18 34 15 13 Leasehold pubs opened 1 – – 1 6 6 15 15 22 16 32 26 Closures (6) (12) (18) (41) (41) (6)
Slide 13: It's a People Thing
“It’s a People Thing” • Around 40,000 employees of which 12,000 are shareholders • Manager retention: 2019 2013 2008 Pub Manager 12 yrs 1 mth 9 yrs 8 mths 7 yrs 1 mth Kitchen Manager 8 yrs 8 mths 6 yrs 5 mths 4 yrs 7 mths • Named for the 16th consecutive year as a Top Employer UK by the Top Employer
Slide 14: Changing Sales Mix since 2000
Changing Sales Mix since 2000 100% 4% 3% 3% 6% 5% 4% 90% 18% (£4.2k)* 25% 29% 33% (£6.9k)* 35% 80% (£8.7k)* (£11.1k)* (£14.6k)* 36% (£16.7k)* 70% 60% Machines 50% Food Bar 40% 76% Hotel/Other (£17.2k)* 70% 66% (£19.7k)* 63% 61% (£19.8k)* 60% 30% (£21.4k)* (£25.5k)* (£28.3k)* 20% 10% 0% 2000 2005 200
Slide 15: Achievements
Achievements Company Total Average • 99% of pubs Cask Marque approved Premises Rating Aldi 635 4.99 • Raised £0.8m in the last 6 months and over Waitrose J D Wetherspoon plc 358 801 4.98 4.97 £16.9m during the 17-year partnership with McDonald’s 912 4.96 CLIC Sargent Pret a Manger 332 4.96 Sainsbury
Slide 16: Taxation
Taxation H1 H1 FY FY FY FY FY FY FY 2019 2018 2018 2017 2016 2015 2014 2013 2012 £m £m £m £m £m £m £m £m £m VAT 175.5 162.5 332.8 323.4 311.7 294.4 275.1 253.0 241.2 Alcohol duty* 86.2 85.4 175.9 167.2 164.4 161.4 157.0 144.4 136.8 PAYE and NIC 59.0 54.1 109.2 96.2 95.1 84.8 78.4 70.2 67.1 Business
Slide 17: Current Trading and Outlook
Current Trading and Outlook • LFL sales for the six weeks to 10th March +9.6% • Total sales for the six weeks to 10th March +10.9% • Excellent weather helping this year; poor weather last year • Higher costs expected to continue in the second half – wages, interest, repairs, utilities and depreciati
Slide 18: Questions
Questions The Crown Rivers, Heathrow T5
Slide 19: Appendix
wetherspoon Appendix 18
Slide 20: 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 • E1 Summary of exceptional items • E2 Pub disposal programme • F1 Peach Brand Track: brand for sit down meal • F2 Peach Brand Track: eating at qu
Slide 21: 10 Year Overview
Appendix A 10 Year Overview £ millions 1,800 Turnover Number of pubs 1,600 1000 950 1,400 900 1,200 850 1,694 800 1,000 1,595 1,661 1,514 951 1,409 927 926 750 886 895 883 886 879 1,281 860 800 1,197 823 955 1,072 700 996 775 890 731 830 600 650 600 400 2009 2010 2011 2012 2013 2014 2015 2016 2017 2
Slide 22: 10 Year Capital Trends
Appendix B 10 Year Capital Trends H1 H1 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Average Size (sq.ft.) – 3,772 6,341 5,201 4,379 4,264 4,321 3,585 3,643 3,325 3,572 3,781 3,359 Openings Number of openings 2 3 6 10 16 30 46 29 40 50 47 39 % which are freehold 50 100 100 90 63 80 67
Slide 23: 10 Year Financial Trends
Appendix C 10 Year Financial Trends H1 H1 2019 2018 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Sales per pub (£000) 1,013 938 1,921 1,807 1,694 1,620 1,562 1,476 1,401 1,360 1,335 1,344 EBITDA per pub (£000) (1) 122.7 131.3 248.0 229.0 209.2 200.9 204.5 200.9 194.9 198.7 205.8 212.9 Number of
Slide 24: ROC/CROCCE/ROE
Appendix D1 ROC/CROCCE/ROE H1 H1 FY 2019 2018 2018 £000 £000 £000 Shareholders equity per accounts 312,095 262,574 286,562 Deferred tax balances 34,418 34,839 34,881 Interest rate swaps valuations 24,045 26,795 24,109 Impairment balances 18,171 23,983 20,329 Net book value of revalued assets (5,540)
Slide 25: ROC/CROCCE/ROE
Appendix D2 ROC/CROCCE/ROE 12 months to 12 months to FY January 2019 January 2018 2018 £000 £000 £000 EBITDA (cash return) (e) 208,507 217,290 214,496 Depreciation and amortisation (f) (81,713) (76,022) (79,305) EBIT (g) 126,794 141,268 135,191 Interest (31,270) (27,852) (27,942) Profit before tax 9
Slide 26: Summary of Exceptional Items
Appendix E1 Summary of Exceptional Items H1 H1 FY 2019 2018 2018 £000 £000 £000 Exceptional property losses Disposal programme (see next slide) 1,286 7,283 13,221 Other property losses Impairment of property, plant and equipment – – 3,588 Onerous lease reversal (154) (110) – Onerous lease provision
Slide 27: Summary of Pub-Disposal Programme
Appendix E2 Summary of Pub-Disposal Programme The company has offered several of its sites for sale. At the period end, 2 (2018: 19) sites had been sold, including sites which were closed in the previous year, two were classified as held for sale and an additional three (2018: six) sites have been c
Slide 28: CGA BrandTrack: Preferred Brand to Eat Out
Appendix F1 CGA BrandTrack: JDW consistently succeed in being voted preferred brand to eat out at Q: If the following brands were available in the same location, which would be your first choice to eat at? 1. 2. 3. 4. 4. 14% 10% 8% 7% 7% Source: CGA BrandTrack, Oct 2018 27
Slide 29: CGA BrandTrack: Most Used Eating Brand
Appendix F2 CGA BrandTrack: JDW is the 4th most used eating brand in GB, holding its own against quick serve outlets 1. 2. 3. 4. 5. 61% 50% 47% 42% 38% Percentage of GB population eaten at brand in past 6 months Source: CGA BrandTrack, Oct 2018 28
Slide 30: Swap Maturity Profile
Appendix G Swap Maturity Profile Swap Value From To Weighted Average % £695m 31 Jul 2018 29 Jul 2021 2.54 £695m 30 Jul 2021 30 Jul 2023 1.64 £695m 31 Jul 2023 30 Jul 2026 1.08 £95m 31 Jul 2026 30 Jun 2028 1.45 29