Fuller, Smith & Turner P.l.c. Class A · LSE:FSTA
Fuller, Smith & Turner P.l.c. Class A — FY2019 Earnings Presentation
29 slides from Fuller, Smith & Turner P.l.c. Class A's earnings presentation, Mar 30, 2019
Slide 1: Annual Results for the 52 weeks ended 30 March 2019
ANNUAL RESULTS FOR THE 52 WEEKS ENDED 30 MARCH 2019
Slide 2: Agenda
AGENDA Highlights Sale of the Fuller’s Beer Business Financial Review Strategy and Operations Review Summary Outlook Annual Results for the 52 weeks ended 30 March 2019 2
Slide 3: Highlights
HIGHLIGHTS A BUSINESS POSITIONED FOR LONG-TERM SUCCESS MANAGED LFL SALES REVENUE ADJUSTED PROFIT ADJUSTED EPS TOTAL ANNUAL DIVIDEND FY 2019 £431.1M £43.2M 62.78P 20.15P +4.9% +7% Level Level +3% FY 2018 £403.6m £43.2m 62.90p 19.55p Annual Results for the 52 weeks ended 30 March 2019 3
Slide 4: The Sale of the Fuller's Beer Business
THE SALE OF THE FULLER’S BEER BUSINESS • Sale of the entire Fuller’s Beer Business to Asahi Europe Ltd (AEL) for an enterprise value of £250m • Sale included all Fuller’s beers, cider and soft drinks production, The Griffin Brewery, Cornish Orchards, Dark Star, Nectar Imports, the wine wholesale bus
Slide 5: Financial Review
FINANCIAL REVIEW
Slide 6: Group Performance
GROUP PERFORMANCE 2019 2018 YoY Total operations £m £m Growth Commentary Revenue 431.1 403.6 +7% ▪ Operating profit +2% despite Operating costs* (381.0) (354.4) +8% impact of refurbishments Operating profit* 50.1 49.2 +2% ▪ Finance costs increased 15% Net finance costs* (6.9) (6.0) +15% due to 20% h
Slide 7: Group Overview: 10 Year History
GROUP OVERVIEW 10 YEAR HISTORY ADJUSTED PROFIT* ADJUSTED EPS FULL YEAR DIVIDEND +89%† +116%† +105%† 62.78p £43.2m 20.15p £34.1m 46.94p 15.10p £22.8m 29.12p 9.85p 2009 2014 2019 2009 2014 2019 2009 2014 2019 * Adjusted profit is before separately disclosed items and tax † 10 year growth rates Annual
Slide 8: Reconciliation to Statutory Profit
RECONCILIATION TO STATUTORY PROFIT 2019 2018 YoY £m £m Growth Adjusted profit 43.2 43.2 Level Separately disclosed items (17.1) 0.4 Profit before tax 26.1 43.6 -40% Tax on adjusted profit (8.5) (8.8) Tax on separately disclosed 1.9 - items Profit after tax 19.5 34.8 -44% Adjusted EPS – total group 6
Slide 9: Separately Disclosed Items
SEPARATELY DISCLOSED ITEMS 2019 2018 £m £m Profit on disposal of properties 1.9 6.1 Commentary Costs incurred on sale of the Fuller’s Beer Business (7.0) - ▪ Profits on disposal of six Replacement of core IT systems (6.7) (3.4) properties of £1.9m (2018: Reorganisation costs (0.5) - £6.1m on 12 prop
Slide 10: Impact of IFRS 16 – Accounting for Leases
IMPACT OF IFRS 16 – ACCOUNTING FOR LEASES ▪ Applicable for the year ended March 2020 from to Estimated impact range ▪ Changes accounting for leases so that most £m £m leases are recognised as a right-of-use asset by Operating costs reduction 9.0 10.0 the lessee Depreciation increase (8.0) (9.0) ▪ Op
Slide 11: Managed Pubs and Hotels
MANAGED PUBS AND HOTELS 2019 2018 YoY £m £m Growth Commentary LFL sales growth +4.9% +2.9% Operating profit [x] due to ▪ Improved LFL performance Revenue 293.8 271.2 +8% impact versus aofgood refurbishments prior period Operating costs* (258.7) (237.8) +9% ▪ Revenue growth over and above LFL driven
Slide 12: Tenanted Inns
TENANTED INNS 2019 2018 YoY £m £m Growth Commentary LFL profit +1% +3% ▪ LFL profit growth of 1% despite Average EBITDA per pub Level +2% increased proactive repairs Revenue 30.9 30.2 +2% ▪ Another year of strong capex spend with nine significant Operating costs* (18.1) (17.3) +5% investments Operat
Slide 13: The Fuller's Beer Company
THE FULLER’S BEER COMPANY 2019 2018 YoY £m £m Growth Commentary Total beer and cider volumes level ▪ Revenue Operatinggrowth profit [x] is driven due toby a Revenue 161.4 152.9 +6% impact full yearof contribution refurbishmentsfrom Dark Star, but this is also contributing Operating costs* (154.6) (1
Slide 14: Sources and Use of Cash
SOURCES AND USE OF CASH £25.9m £245.2m £1.0m £32.7m £201.9m £13.1m £5.3m £7.3m £9.7m £23.3m £8.6m £6.2m £73.2m Net debt EBITDA Interest Tax Working Other Discontinued Property Dividends Capex Acquisitions Non cash Net debt 31/3/18 capital, separately operations disposals and share movements 30/3/19
Slide 15: Strong Financial Position
STRONG FINANCIAL POSITION Available Facilities ▪ Net debt at 30 March 2019 of £245.2m ▪ Committed bank facilities increased by £50m to 29 June 2019 30 March 2019 £260m ▪ £42.0m available (including cash) £45.8m £11.0m £31.0m ▪ Average cost of gross borrowings for 2019 of 2.9% (2018: 2.8%) Cash ▪ Str
Slide 16: Strategy and Operations Review
STRATEGY AND OPERATIONS REVIEW
Slide 17: Managed Pubs and Hotels: Analysis of Revenue
MANAGED PUBS AND HOTELS ANALYSIS OF REVENUE • Strong performance from our Managed Pubs and Hotels Food Drinks • Like for like sales increase of 4.9% – with growth across all 30% 63% revenue streams • High quality pub estate in stunning locations with wet sales accounting for 63% of turnover Accommod
Slide 18: Managed Pubs and Hotels: Investments
MANAGED PUBS AND HOTELS: INVESTMENTS 18 ▪ Acquired Bel & The Dragon, six country inns in the Home Counties, June 2018 ▪ Added 57 bedrooms to Fuller’s portfolio ▪ Significant synergies still to come from full integration into Managed Pubs and Hotels division ▪ Acquired four sites from We Are Bar Grou
Slide 19: Managed Pubs and Hotels: Accommodation
MANAGED PUBS AND HOTELS: ACCOMMODATION • Added 93 bedrooms to our estate, taking us to a total of 817, including: – 57 from Bel & The Dragon – 15 at The Counting House in Cornhill – 9 at The Blackbird in Earl’s Court – 7 at The Fox & Goose, Ealing • Live chat introduced to assist online customer boo
Slide 20: Managed Pubs and Hotels: Consumers
MANAGED PUBS AND HOTELS: CONSUMERS • Further menu developments to provide more balanced, healthier and vegetarian/vegan dishes in line with marketplace trends • Enhanced website capability to allow menu search by dietary preferences • Improved customer journey for booking tables and accommodation –
Slide 21: Managed Pubs and Hotels: Our People
MANAGED PUBS AND HOTELS: OUR PEOPLE • Continued investment in home grown talent with 18 tailored development programmes to build genuine career paths at all levels • Work underway to relaunch our employer brand and ensure we continue to recruit and retain the best talent • 120 candidates completed a
Slide 22: Managed Pubs and Hotels: Suppliers
MANAGED PUBS AND HOTELS: SUPPLIERS • Long-term supply agreement with Asahi for Fuller’s and Asahi key brands and a vibrant and changing seasonal Fuller’s portfolio • Fuller’s beers set to benefit from Asahi’s ability to provide increased marketing support and investment in key brands • Continuation
Slide 23: Tenanted Inns
TENANTED INNS • Good year for our Tenanted Inns with turnover rising 2% • 30 sites on turnover agreements at the year end • £3.0m of capital investment – including nine sites that have moved on to the turnover agreement • Seven sites transferred from Managed estate during the year and five sites sol
Slide 24: Summary
SUMMARY • Excellent performance from our Managed Pubs and Hotels Business • Substantial investment programme in our iconic pub and hotel estate • Added 11 outstanding sites to our portfolio, all now fully invested • Focus and investment in creating career paths for our highly motivated team of peopl
Slide 25: Outlook
OUTLOOK
Slide 26: Current Priorities
CURRENT PRIORITIES • Delivering the Transitional Services Agreement with Asahi • Building on the long-term supply agreement with Asahi to maintain our point of difference • Complete a return of capital to our shareholders • Structuring the business for future growth and embedding the new management
Slide 27: Focused Executive Team
FOCUSED EXECUTIVE TEAM Simon Emeny Chief Executive Adam Councell Dawn Browne Fred Turner Jane Jones Peter Turner Finance Director People & Talent Director Retail Director Marketing Director Property Director Joins end of August Photo of Adam Annual Results for the 52 weeks ended 30 March 2019 27
Slide 28: Outlook
OUTLOOK • Current trading for the last 16 weeks • Managed LFL sales up 1.2%; Total sales up 2.3% • Tenanted LFL profits down -3% • Business underpinned by excellent team of motivated people and well-invested estate of distinctive pubs in stunning locations • Position of strength: a well-funded, high
Slide 29: Appendix – Fuller's Inns
APPENDIX – FULLER’S INNS 31 Mar Acquired Lease 30 Mar Within 2018 /new Disposed Expiry Transfers 2019 the M25 Managed Pubs & Hotels 199 11 – (1) (5) 204 60% Tenanted Inns 180 - (5) - 5 180 28% Total Fuller’s 379 11 (5) (1) – 384 45% The Stable 17 – – – – 17 Total Group 396 11 (5) (1) – 401 Annual Re
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