Young & Co.'s Brewery, P.L.C. Class A · LSE:YNGA
Young & Co.'s Brewery, P.L.C. Class A — FY2010 Earnings Presentation
32 slides from Young & Co.'s Brewery, P.L.C. Class A's earnings presentation, June 2010
Slide 1: Results Presentation for the period ended 29 March 2010
Results Presentation for the period ended 29 March 2010
Slide 2: Agenda
Agenda 1. This is Young’s Young s 2. Financial Review 3. Operations Review 4. Prospects and Outlook 2
Slide 3: 1. This is Young's
‘ 1. This is Young’s Sp...
Slide 4: This is Young's
This is Young’s • One of Britain’s most established pub companies with an estate of 219 pubs • Premium offering, location and ambience • Retains brewing heritage through 40% shareholding in Wells & Young's Revenue Pub Numbers Managed pubs £93.1 M Managed hotels £19.8 Managed pubs 104 Managed hotels
Slide 5: Robust Results
Robust Results • Sales and profit growth in testing market • Strong cashflow and repaid debt whilst investing in the estate • 13th consecutive year of dividend increase +3.4% +2 0% +2.0% +1.1% +1.4% -1.2% Operating Revenue PBT* EPS* Dividend profit* £127.5m £20.3m £19.4m 28.71p 13.00p All results on
Slide 6: Value through Asset Backed Dividend Growth
Value through Asset Backed Dividend Growth 35 30 25 20 ce Penc 15 10 5 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Dividend EPS 6
Slide 7: 2. Financial Review
‘ 2. Financial Review Sp...
Slide 8: Group Results
Group Results 2010 2009 £m £m Managed houses 26.31 25.94 Tenanted houses 5.35 5.82 Corporate services (11.36) (11.21) Wells & Young’s Young s 1 96 1.96 1 89 1.89 Finance costs (net) (2.84) (3.28) Adjusted profit before tax 19.42 19.16 8
Slide 9: Adjusted Profits on Continuing Operations
Adjusted Profits on Continuing Operations 2010 2009 £m £m Profit before tax (including Wells & Young’s) 18.4 4.2 Add back Wells & Young’s g tax included in above 0.3 0.7 Operating exceptional items 0.2 10.5 Wells & Young’s Young s exceptional items 05 0.5 38 3.8 Adjusted profit before tax 19.4 19.2
Slide 10: Strong Cash Flow and Continued Investment
Strong Cash Flow and Continued Investment 2010 2009 £m £m Cash generated from operations 26.9 26.4 VAT o on sale sa e of o brewery b e e y site s e - ((10.3) 0 3) Interest, tax and dividends (14.0) (9.0) Free cashflow 12 9 12.9 71 7.1 Allocation of ESOP shares - 0.6 Di Disposals l 10 1.0 14 1.4 Capi
Slide 11: Investment in the Pub Estate
Investment in the Pub Estate Total Spend: £10.7 million (2009: £24.0 million) By Division By Nature of Spend Investment on recent acquisitions q £1.6 M Managed £6.0 M Hotels £2.2 M Investment expenditure on existing estate £9.1 M Tenanted £2.5 M 11
Slide 12: Debt Structure
Debt Structure Long dated committed facilities: • £50 million long term finance (March 2018 to 2023) £90 0 million £90.0 • £40 million medium term finance (March 2013) Net debt £62.2 million Gearing (no revaluation since 1997) 36.9% % of debt fixed 55.1% Interest cover 7.6 times Composite fixed rate
Slide 13: Estate Profile of Trading Pubs
Estate Profile of Trading Pubs 2009 + - Transfers 2010 Managed 122 - - (2) 120 Tenanted 99 1 (3) 2 99 Total 221 1 (3) - 219 Freehold 185 - (2) - 183 The freeholds above exclude 11 leases with in excess of 40 years to run, with rents that in total amount to less than £10,000 13
Slide 14: Financial Summary
Financial Summary • Resilient performance in managed houses; comparatively strong in tenanted • Revenue up 1.1% with adjusted profit before tax up 1.4% • Cash generative business, with net debt reductions despite £10.8 million CAPEX • Robust balance sheet and conservative long term financing • Net d
Slide 15: 3. Operations Review
3. Operations Review Sp...
Slide 16: Like-for-like Sales
Like-for-like Sales Number Sales Change of sites £m % Same outlet Managed 107 104 9 104.9 - Tenanted 95 13.7 1.2 202 118.6 0.1 Un-invested Managed 96 93.5 -1.2 Tenanted 83 11 7 11.7 -0.4 04 179 105.2 -1.1 16
Slide 17: Operating Performance at Pub Level
Operating Performance at Pub Level 2010 Change Revenue £m % Managed 112 9 112.9 13 1.3 Tenanted 14.3 -0.3 127.2 1.2 EBITDAR* £m % Managed 34.7 1.5 T Tenanted t d 71 7.1 -5.9 59 41.8 0.1 * At outlet level, before interest, taxes, depreciation, rents payable 17
Slide 18: Managed Operating Highlights
Managed Operating Highlights Managed houses, 88.5% of total revenue • Resilience despite challenging market: • Revenue up 1.3% to £112.9 million • Operating profit up 1.4% to £26.3 million • EBITDA up 1.5% to £33.0 million • Combined food and liquor margins ahead of last year on a like-for-like lik
Slide 19: Managed House Revenue Mix
Managed House Revenue Mix 100% 6.3% 5.5% 5.2% 90% 25.4% 26.1% 26.4% 80% 70% 60% 50% 40% 68.3% 68.4% 68.4% 30% 20% 10% 0% 2008 2009 2010 Liquor q Food Rooms and other 19
Slide 20: Liquor and Food - Key Initiatives
Liquor and Food - Key Initiatives Liquor • Strong cask ale offering accounts for 35.4% of total draught beer volumes • Complemented by extensive lager range: • Estrella Damm and Kirin • Most resilient component of revenue Food • ‘Best of British’ with emphasis on local provenance: • Emphasis on fres
Slide 21: Like-for-like Food Margin
Like-for-like Food Margin 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 2008 2009 2010 Cumulative Percentage Point Growth 21
Slide 22: Hotel Accommodation
Hotel Accommodation First half Second half Total Room rate £59.79 -£4.75 £62.44 -£2.94 £61.09 -£3.84 Occupation Occupa o 64.3% 6 3% -4.40% 0% 62.1% 6 % +4.20% 0% 63.2% 63 % -0.10% 0 0% REVPAR £38.44 -£5.91 £38.79 +£0.91 £38.62 -£2.49 22
Slide 23: Accommodation Profile
Accommodation Profile Who stays in a Young’s hotel? • Business g guests during g week attracted byy the individual touch and local welcome • Diverse range of weekend guests: tourists, leisure breaks, people visiting friends and family What attracts them to our hotels? • Individual, quality, stylish
Slide 24: Accommodation – Key Initiatives
Accommodation – Key Initiatives • Much improved second half performance • RevPar of £38.62 • Down 6.1% for the year due to reduced rates • But up 2.4% on the comparable six months • Initiatives undertaken during the period include: • New general manager for hotel division • A Appointment i t t off f
Slide 25: Tenanted Operating Highlights
Tenanted Operating Highlights Tenanted houses, 11.2% of total revenue • Comparatively strong performance: • Same outlet like-for-like sales up 1.2% and volumes little changed on last year • Transfer of two high profile tenancies: • Overall volumes down 4.1% • Operating profits down 7.9% to £5.4 mill
Slide 26: Tenanted Operating Highlights (continued)
Tenanted Operating Highlights (continued) • Competitive and flexible packages designed to attract entrepreneurial new tenants • Diverse portfolio of ales and lagers supplied by Wells & Young’s complemented by a guest ale range g • Value for money wine offer from Cockburn & Campbell • Implemented sup
Slide 27: Wells & Young's
Wells & Young’s • Brewing partnership with Charles Wells, Bedford • Our 40% share contributed £2.0 million to adjusted profit before tax, up 3.6% • Comparatively strong performance with sales and brewing volume growth, once adjusted for the loss of Cobra contract • Export volumes up 9.1% • Innovativ
Slide 28: 4. Outlook and Prospects
4. Outlook and Prospects Sp...
Slide 29: World cup winning initiatives
World cup winning initiatives Target customer • Young’s customers, their families and friends • Individuals, mixed groups of friends and colleagues • Private parties and corporate hospitality with unobstructed views and full table service Young’s g World Cup p Micro site - http://worldcup.youngs.co.
Slide 30: Outlook and Prospects
Outlook and Prospects • Wider trading conditions still demanding • Trading during first eight weeks of the new financial year has been encouraging • Managed house sales up 1.9% 1 9% in total and up 2.2% on a like-for-like basis • Continue to drive value from existing estate and invest across the bus
Slide 31: Our Investment Proposition
Our Investment Proposition • Well managed story • Consistent shareholder returns • Well positioned in the marketplace both geographically and demographically • Cash generative business model • Strong balance sheet, having avoided the high levels of gearing that have blighted the sector • Clearly def
Slide 32: Questions
Questions 32
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