Mitchells & Butlers plc · LSE:MAB
Mitchells & Butlers — FY2009 Earnings Presentation
25 slides from Mitchells & Butlers's earnings presentation, Nov 26, 2009
Slide 1: Supplementary Information: Market and Financial
Supplementary Information Market and Financial P li i Preliminary Results R lt – 26 N November b 2009
Slide 2: Market Consumer Expenditure (£m) 1984 to 2008
Market Consumer Expenditure (£m) 1984 to 2008 Total Total (Nominal) (Real) 80000 6.4% % 1.4% % 70000 60000 50000 8.3% 3.3% 40000 Eating Out 30000 20000 Wine Spirits 10000 4.6% -0.4% Beer 0 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2
Slide 3: Growth of Eating Out Demand
Growth of Eating Out Demand % of total food spend out of home Increase 22% 3rd Income Decile 10% 2.2x (Just above min wage) 32% 20% 1.6x 6th Income Decile ((Average g – C1)) 37% 27% 1.4x 9th Income Decile (Affluent – B) 1989 2008 Source: ONS (Family Spending Survey) 3
Slide 4: Eating out as a percentage of total food expenditure (UK vs US)
Eating out as a percentage of total food expenditure (UK vs US) penditure on food 60 US 50 40 UK usehold exp 30 20 % of total hou 10 0 1970 1975 1980 1985 1990 1995 2000 2005 2008 Source: US Dept of Agriculture, Economic Research Service and ONS (Family Spending Survey) 4
Slide 5: Beer volume: on-trade vs off-trade
Beer volume: on-trade vs off-trade UK beer market volume (barrels thousands) 40000 35000 30000 On Trade 25000 Barrels (thousands) CAGR CAGR 20000 (80-08) (01-08) -2.7% -4.3% 15000 B +3.8% +2.8% 10000 Off Trade 5000 0 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07
Slide 6: Movement in Beer Price: 1987 to 2009
Beer Price (rebased to 100) 19 87 50 100 150 200 250 300 Ja 19 n 88 Ja 19 n 89 Ja 19 n 90 Ja 19 n 91 Ja 19 n 92 Ja n Source: ONS RPI index 19 93 Ja 19 n 94 Ja 19 n 95 Ja 19 n 96 Ja 19 n 97 Ja 19 n 98 Ja n 6 19 99 Ja 20 n 00 Ja 20 n 01 Ja 20 n 02 Ja 20 n 03 Ja 20 n 04 Ja 20 n 05 Ja 20 n 06 Ja 20 n 07
Slide 7: Food and drink market (£bn) – in and out of home
Food and drink market (£bn) – in and out of home Household expenditure on all food* and alcoholic drink 2008 £ billions 93 0 93.0 72 0 72.0 Total = 165.0 165 0 100% Alcohol 14.3 80 Alcohol 29.2 60 40 Food & Soft Drinks 78.7 Food & Soft Drinks 42.8 20 0 In Home Out of Home *Includes soft drinks 7 Sou
Slide 8: Drinks Purchases (£bn) – in and out of home
Drinks Purchases (£bn) – in and out of home Household Expenditure on Total Alcoholic Beverages 2008 £ billions 19 0 19.0 15 9 15.9 86 8.6 Total = 43.5 43 5 100% 80 Out of Out of Home 9.1 Home 4.5 60 Out of Home 15.6 40 In Home 20 In Home 6.8 41 4.1 In Home 3.4 0 Beer Wine Spirits Source: Consumer Tr
Slide 9: Drinks volumes (hectolitres) – in and out of home
Drinks volumes (hectolitres) – in and out of home Out of home 0.5 50 6 50.6 11 5 11.5 2 6 Total 2.6 = 64.7 64 7 100% Out of home 1.7 80 Out of home 27.1 60 In home 2.1 40 In home 23.5 In home 20 9.8 0 Beer Wine Spirits Source: BBPA 9
Slide 10: Average Food Price by Retail Brand
Loch h Fyne Café é Rouge PCD DG Basis: Unweighted average price of five pub main meals for all pub brands (chicken dish, burger, fish & chips etc), UCD brands are a straight Brow wns Gira affe nkie & Benny's Fran Carluccio's Beeffeater All Bar B One Average Non Promoted Retail Price of Selected Main
Slide 11: Average Drink Price by Retail Brand
Chef & Brrewer Castle Revolutio on All Bar On ne Nicholson n's & Classics Two For One O (Punch) ub & Kitchen Village Pu 2 4 1 (Marston's) Non Promoted Drinks Price - Basket of selected products O'Neill's Vintage In nns Miller & Carter C Beefeaterr Brewers Fayre F Table Tab ble Average Drink Price: 1
Slide 12: MAB volume performance vs the market
MAB volume performance vs the market MAB Estimated Volume Growth (1) Market Volume Growth (2) Food 7% -3% Wine & Soft Drinks 2% -3% Spirits -4% -5% Beer & Cider Flat -6% % (1) Same outlet like-for-like growth (2) MAB estimates based on BBPA/AC Neilsen/ONS 12
Slide 13: Retail revenue growth FY09
Retail revenue g growth FY09 Total Revenue* up 3.4% Same Outlet like-for-likes up 1.6% Uninvested like-for-likes up 0.8% * Excluding SCPD 13
Slide 14: Same outlet like-for-like sales FY09
Same outlet like-for-like sales FY09 H1 09* H2 09** FY09 Di i i Divisional l Pubs & Bars*** 1.9% 1.3% 1.7% Restaurants 0 6% 0.6% 2 9% 2.9% 1 5% 1.5% Segmental Residential 2 0% 2.0% 3 3% 3.3% 2 5% 2.5% High Street 0.3% (1.0)% (0.2)% Total*** Total 1 2% 1.2% 2 1% 2.1% 1 6% 1.6% * *Wks 1 1-33 33 to inc
Slide 15: Uninvested like-for-like sales FY09
Uninvested like-for-like sales FY09 H1 09* H2 09** FY09 Di i i Divisional l Pubs & Bars*** 1.1% 1.0% 1.1% Restaurants (0 9)% (0.9)% 2 4% 2.4% 0 4% 0.4% Segmental Residential 0 6% 0.6% 2 8% 2.8% 1 4% 1.4% High Street 0.1% (1.1)% (0.4)% Total*** Total 0 2% 0.2% 1 7% 1.7% 0 8% 0.8% * *Wks 1 1-33 33 to
Slide 16: Average Retail Price FY09 Food and Drinks
Retail Price FY09 4 Food Drinks +3.0% 3 2 -0.9% e (%) LFL Price +2.1% e Retail Price 1 0.3% LFL Price 1 Average 2 -3.7% 3 4 -4.0% 5 Note: Prices exclusive of VAT, prices for like for like pubs 16
Slide 17: Retail revenue & profit FY09
Retail revenue & p profit FY09* Restaurants Pubs & Bars Total Food Revenue £602m £187m £789m Food Revenue Mix% 60.3% 19.5% 40.3% Drink Revenue £354m £669m £1,023m T t l Revenue Total R £999 £999m £958 £958m £1 957 £1,957m Operating Profit ** £141m £159m £300m * Excluding SCPD ** Before exceptional i
Slide 18: Retail FY09
Retail FY09* FY09 FY08 Pub staff costs %age 24.3% 24.2% Net Retail Operating Margin 15.3% 17.5% Expansionary Capex £36m £82m Maintenance Capex £86m £111m Disposals £72m £82m *Excluding SCPD 18
Slide 19: Retail Beer Price – Comparison of Information Sources
Retail Beer Price – Comparison of Information Sources CGA approach - Calculates C an average price based on an un-weighted average not reflecting relative product volumes e.g. Carling price has same weighting as Becks Vier price AC Nielsen - Calculates an average price based on weighted average refl
Slide 20: CROCCE and NOPAT FY09
CROCCE and NOPAT FY09 52 weeks to 26 September 2009 £m CROCCE £m NOPAT EBIT 300 300 Depreciation/Amortisation 128 EBITDA 428 Cash Tax ((at 25% of EBIT)* ) ((75)) ((75)) Cash Return 353 225 Average Net Operating Assets 4 406 4,406 4 406 4,406 Average Accumulated Depreciation 699 9.8% 7.7% Average Rev
Slide 21: Brands and operating formats FY09
Brands and operating formats FY09 Crown Carveries R id ti l Residential Other locals Pub Local Pubs Ember Inns Harvester Restaurants 36% of pubs 111 170 172 40% of pubs 29% of sales 57 48% of sales 102 Premium Country Cornerstone Sizzling Dining 197 Vintage Inns Toby 199 133 23 35 Miller & Carter Sc
Slide 22: Brands and operating formats FY09
Brands and operating formats FY09 Residential Value Suburban City & Country 41% of pubs 27% of pubs 32% of pubs 34% of sales 32% of sales 34% of sales Vintage Inns 111 Crown 199 28 Carveries 57 Toby 133 Metropolitan Harvester Other pub Sizzling Professionals 109 172 restaurants Premium 197 C Country
Slide 23: Outlet Reconciliation FY09
Outlet Reconciliation FY09 Total MAB Franchised Total Managed Pubs & Bars Restaurants Closing Outlets (end FY 08) 1993 94 1899 1081 818 T Transfers f 0 -2 2 2 4 -2 2 Disposals -28 -3 -25 -20 -5 Acquisitions 5 0 5 0 5 Closing Outlets (end H1 09) 1970 89 1881 1065 816 Average Trading Pubs 1874 1070 80
Slide 24: Securitisation Overview FY09
Securitisation Overview FY09 Legal Balance Maturity Class at 26/09/09 Date Coupon Ratings A1N £200 £200m D 30 Dec-30 £ Lib Libor + 0.18% 0 18% AA/AAA/A1 A2 £400.8m Dec-30 5.574% AA/AAA/A1 A3N $418.75m* Dec-30 $ Libor + 0.18% AA/AAA/A1 A4 £170m Dec-30 £ Libor + 0.23% 0 23% AA/AAA/A1 AB £325m Dec-33 £
Slide 25: Financial Covenants Summary FY09
Financial Covenants Summary FY09 Securitisation Restricted Payment Tests Covenant Actual Headroom (Relevant Year) Free Cashflow to Debt Service 1.3x 1.8x £81m EBITDA to Debt Service 1.7x 2.0x £59m Securitisation Covenants Covenant Actual Headroom (Relevant Year) Free Cashflow to Debt Service 1.1x 1.