Fuller, Smith & Turner P.L.C. Class A · LSE:FSTA
Fuller, Smith & Turner P.L.C. Class A — H1 2003 Earnings Presentation
36 slides from Fuller, Smith & Turner P.L.C. Class A's earnings presentation, 2002
Slide 1: Fuller, Smith and Turner PLC Interim Results
Fuller, Smith and Turner PLC Interim Results for 6 months to 28th September
Slide 2: Strategy
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 • Medium term aim - double the estate to 500 outlets, subject to sensible freehold price
Slide 3: Corporate Progress
Corporate Progress • Strong performance by the Beer Co. with profits up 23% • Mixed performance in Managed Pubs and Bars with English Inns up but City outlets down compared with last year • New hotels are trading well with rising occupancy • A good performance from the Tenanted Estate with profits u
Slide 4: Financial Highlights
Financial Highlights • Turnover up 5% to £68.8m (2001 £65.3m) • Normalised profits up 20% to £7.7m (2001* £6.4m) • EBITDA up 12% to £12.9m (2001 £11.5m) • Normalised E.P.S. up 21% to 20.83p (2001* 17.27p) • Own beer volumes up 9% • £6.4m invested in share buy-backs since our year end ** Excludes Exc
Slide 5: Normalised Profits
Normalised Profits 9 8 7 7.7 6 7.2 6.4 6.6 6.4 £m 5 4 3 2 1 +8% +3% +9% -11% +20% 0 1998 1999 2000 2001 2002
Slide 6: Normalised E.P.S.
Normalised E.P.S. E.P.S. impact of FRS19 shown in last three periods 25 20 Pence per share 20.8 18.4 19.4 15 17.7 17.3 10 5 +7% +4% +5% -11% +21% 0 1998 1999 2000 2001 2002
Slide 7: Interim Dividend
Interim Dividend 6 5 Pence per share 4.8 4 4.4 4.5 4.1 3 3.8 2 1 +6% +6% +8% +2% +6% 0 1998 1999 2000 2001 2002
Slide 8: Share Buy-backs
Share Buy-backs • In the last 12 months the Company has bought back 5% of its share capital • Average price per share was £4.85 which compares to the net assets per share of £6.26 • Free float still higher than when first listed on the main market in 1996 • In a market where freeholds are overpriced
Slide 9: Profit Reconciliation
Profit Reconciliation Sept Sept Sept Sept 2002 2002 2001 2001 £m £m £m £m Normalised profit 7.71 6.45 Impairment of property (FRS 11) - (1.35) Exceptional losses on disposal - (3.82) Published pre-tax profit 7.71 1.28
Slide 10: Key Figures
Key Figures Sept Sept Sept Sept 2002 2002 2001 2001 Net Debt £22.2m £21.6m Gearing 14.5% 14.3% Net Assets £152.3m £151.2m Net Assets Per Share £6.26 £5.91 EBITDA £12.9m £11.5m Interest Cover* 8.9 x 8.8 x Effective Tax Rate* 32.5% 31.8% * Based on normalised profits
Slide 11: Total Capital Expenditure
Total Capital Expenditure 35.0 30.2 30.2 30.0 26.9 23.3 23.3 26.9 25.0 Fuller’s Inns £m 20.0 20.0 20.0 16.6 16.6 14.0 14.0 Beer Company 15.0 10.0 and Central 5.0 0.0 1998 1999 2000 2001 2002 2003 Projected Projected
Slide 12: Financial Strengths
Financial Strengths • Strong cash generative business • Gearing low at 14.5% • Only 7% of property by value is on commercial leases • Prudent depreciation policy • Managed LFL based on over 75% of estate • Strong balance sheet
Slide 13: Retail Split
Retail Split March March Net Net Additions Additions Net Net September September 2002 2002 // Sales Sales transfers transfers 2002 2002 Managed Pubs & Bars 114 +1 -1 114 Hotels 8 nil nil 8 Tenanted Pubs 117 nil +1 118 239 +1 nil 240
Slide 14: Fuller's Inns Key Figures
Fuller’s Inns Key Figures Sept Sept Sept Sept 2002 2002 2001 2001 increase increase Turnover £48.9m £47.3m +3% Normalised profit £8.2m £7.2m + 14 % EBITDA £11.5m £10.4m + 10 %
Slide 15: Managed Pubs & Bars
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Slide 16: Trading Patterns
Trading Patterns • Total LFL turnover down 1.7% • City outlets LFL turnover down 5.1% • Turnover in refurbished outlets is up 16% • Destination food LFL turnover up 5.6% • Margins improved through focus on quality
Slide 17: Grove Lock
Grove Lock • Opened in August • Situated by the Grand Union canal near Leighton Buzzard • Highest taking food pub in first month of trading
Slide 18: Fuller's Hotels
Fuller’s Hotels
Slide 19: Fuller's Hotels Key Figures
Fuller’s Hotels Key Figures Sept Sept Sept Sept 2002 2002 2001 2001 change change Average Number of Rooms 492 317 + 55 % Room Rates £66.55 £58.09 + 15 % Occupancy 68% 70% -3% RevPar £45.09 £40.63 + 11 %
Slide 20: New Hotels
New Hotels
Slide 21: Tenanted Inns
Tenanted Inns
Slide 22: Tenanted Inns Key Facts
Tenanted Inns Key Facts Average turnover per house + 5% Average profit per house + 6% Net increase in Tenanted Estate +1 Number of pubs at September 2002 118 25% of tenancies now converted to 10 year lease
Slide 23: Awards
Awards • The Churchill Arms – West London CAMRA Pub of the Year • The Little Windsor – Sutton & Croydon CAMRA Pub of the Year • The Red Lion, Ealing – West Middlesex CAMRA Pub of the Year • The Wheatsheaf – Slough, Windsor & Maidenhead CAMRA Publican of the Year • The Star, Belgravia – included in a
Slide 24: Fuller's Inns Summary
Fuller’s Inns Summary • Improved margins resulting from focus on quality • New management team in place for Managed Pubs and Bars • Encouraging growth in food sales • City trading challenging, but well placed for recovery in due course • Good overall performance from hotels • Tenanted business perfo
Slide 25: Fuller's Beer Company Key Figures
Fuller’s Beer Company Key Figures Sept Sept Sept Sept increase increase 2002 2002 2001 2001 Turnover £30.9m £29.4m +5% Profit £2.8m £2.3m + 23 % EBITDA £3.5m £2.9m + 18 %
Slide 26: Beer Volumes
Fuller’s Beer Company Beer Volumes Fuller’s Beer 2002 2002 2001 2001 change change ‘000 ‘000 brls brls ‘000 ‘000 brls brls Fuller’s Inns 14.9 15.2 -2% Free On Trade 60.2 53.3 + 13 % Off Trade 12.7 11.6 + 10 % Exports 5.9 6.0 -2% Total Own Beer 93.7 86.1 +9% Total Foreign Beer 37.7 41.0 -8% Total All
Slide 27: Comparison with UK Market
Fuller’s Beer Company Comparison with UK Market Fuller’s Fuller’s UK UK Market Market ** (UK (UK only) only) Total Beer +4% +1% Total Ale + 10 % -8% On Trade Ale +9% -9% Off Trade Ale + 11 % -1% Cask Ale +9% -5% ** Source Source :: AC AC Nielsen/BBPA Nielsen/BBPA
Slide 28: London Pride
Fuller’s Beer Company London Pride • Cask volumes up 11% - UK’s no.2 Premium Cask Ale - 5% share of cask market • Packaged volumes up 11% • Increased investment in advertising
Slide 29: Golden Jubilee Celebrations
Golden Jubilee Celebrations • Official beer supplier to the Queen’s concerts • Over 28,000 pints of London Pride and Organic Honey Dew enjoyed!
Slide 30: Fuller's Beer Company Awards
Fuller’s Beer Company Awards • Fuller’s wins The Good Pub Guide 2003 Brewer of the Year award • Unprecedented three medals at the Great British Beer Festival • London Pride is UK’s most desired cask ale – The Publican Newspaper ‘Desert Island Brands’ survey
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Slide 33: Fuller's Beer Company Summary
Fuller’s Beer Company Summary • Strong first half growth with profits up 23% • Total Own Beer sales up 9% with off trade up 10% • Wines continue to perform well with profits up 10% • Organic Honey Dew volumes up 50% • Volumes up - margins maintained
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Slide 35: Prospects
Prospects • Beer Co. performing well but will be measured against a strong second half last year • Realistic to expect that trading conditions for Managed Estate will remain tight • Hotels making pleasing progress with good growth potential • Company focused on long term returns and high quality ear
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