Fuller’s has reported its financial results for the 52 weeks ended 28 March 2015, describing it as ‘Another very good year with exciting developments for the future’.
Douglas Jack of Numis commented: “We reiterate our Add recommendation. We believe Fuller’s has plenty of investment and operational initiatives to maintain its momentum. Also, with net debt/EBITDA at 2.7x, there is scope for our 2016E expansion assumptions to be exceeded: we forecast two new managed pubs and six new Stable Pizza restaurants, and all these sites are already found and scheduled to open.”
Excellent progress
Commenting on the results, Chief Executive Simon Emeny said: “It has been another year of excellent progress for the Company and I am delighted to be reporting growth in all three areas of the business.
“Our Managed Pubs and Hotels business continues to outperform the industry, the Fuller’s Beer Company has seen growth in all channels and our Tenanted business has had an outstanding year.
“We have a robust business that has continuously evolved over time, keeping us at the forefront of our industry and providing a base for us to always look for new opportunities to keep the business fresh, relevant and in a strong position to grow for the future. These opportunities have to complement our overall vision to provide a first class experience for discerning customers.
“The new financial year has got off to a good start with solid sales for the nine weeks to 30 May 2015. Like for like sales in our Managed Pubs and Hotels have risen by 5.5% and like for like profits in our Tenanted Inns have risen by 2%. Beer and cider volumes have decreased by 2%.
“We have taken on new companies, new brands and new ideas over the last two years and while they have all started well, the best is yet to come. We are looking forward to completing the integration of these new businesses and building for our future. We will also continue to invest heavily in our existing pub estate and develop our range of brands.
“We have a successful business model, interesting fledgling opportunities, a first class, predominately freehold estate, a team with passion and ability and a very healthy balance sheet. This gives me confidence that we will continue to deliver strong results for our customers, our employees and our shareholders.”
Financial Highlights
- Adjusted earnings per share up 10% to 51.51p (2014: 46.94p)
- Adjusted profit before tax up 7% to £36.4 million (2014: £34.1 million)
- Revenue up 12% to £321.5 million (2014: £288.0 million)
- EBITDA up 8% to £58.7 million (2014: £54.5 million)
- Total annual dividend up 10% to 16.60p (2014: 15.10p)
- Net debt to EBITDA 2.7 times (2014: 2.5 times)
Operational Indicators
- Excellent like for like sales growth of 6.3% in Managed Pubs and Hotels
- Outstanding performance from Tenanted Inns – like for like profits increase of 5%
- Good year for Fuller’s Beer Company with total beer and cider volumes up by 4%
Strategy Update
- Eight new pubs opened during the year including two on the River Thames, two with bedrooms and two in transport hubs
- Acquired 51% of The Stable, craft cider and gourmet pizza business, and opened a seventh site during the year in Falmouth
Record levels of investment in existing estate, with excellent returns on redeveloped sites
- Completed integration and more than doubled UK distribution of Sierra Nevada
- Made of London campaign received two industry marketing awards and continues to drive sales of London Pride
- Frontier craft lager performed well – now the Company’s second biggest brand in the UK
Current Trading
- Good start to the new financial year
- Managed Pubs and Hotels like for like sales increased by 5.5% during the first nine weeks
- Tenanted Inns like for like profits for first nine weeks increased by 2%
- Total beer and cider volumes down 2% during first nine weeks
- Purchased The King’s Head, Earl’s Court Village
- Opened The Stable on the waterfront at Plymouth with at least four more new sites due to open in the current year
- The Sail Loft on Greenwich Reach due to open in fourth quarter
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