Pub and beer company Marston's (MARS) had a strong year, with underlying EPS having risen 10 per cent in the period. It has started the new financial year in fine fettle, too, and managed pub like-for-like sales rose 2 per cent in the first eight weeks, with an estimated 3 per cent profit increase at tenanted pubs. That underlines the success of a multi-pronged strategy adopted following the credit crunch. "We've absolutely adhered to the strategy," says chief financial officer Andrew Andrea. "It's the bedrock of our success."
The plan to build new pubs focused on food in high footfall locations continues to deliver - new builds were valued at 56 per cent more than build cost in a recent five-yearly estate revaluation. And, overall, managed-pub profits grew 4.5 per cent at £74.2m and the profit margin nudged up 20 basis points to 18.3 per cent. Moreover, the introduction of a franchise-style lease agreement a few years ago is invigorating the tenanted division, which boosted profits by 3.2 per cent to £81.8m. Some 436 tenanted pubs have been written-down in value and earmarked for disposal as part of the recent revaluation. Brewing, meanwhile, is benefiting from premium ale and a local focus with 2 per cent volume growth.
Broker Numis Securities expects pre-tax profit of £96.5m for 2013, giving EPS of 13.1p and a 6.41p dividend (2012: £87.8m/12.2p).
MARSTON'S (MARS) | ||||
---|---|---|---|---|
ORD PRICE: | 124p | MARKET VALUE: | £708m | |
TOUCH: | 123-124p | 12-MONTH HIGH: | 128p | LOW: 87p |
DIVIDEND YIELD: | 4.9% | PE RATIO: | na | |
NET ASSET VALUE: | 133p* | NET DEBT: | 147% |
Year to 29 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2008 | 666 | 76.2 | 16.3 | 9.50 |
2009 | 645 | 21.4 | 3.90 | 7.10 |
2010 | 651 | 52.5 | 8.30 | 5.80 |
2011 | 682 | 80.8 | 12.1 | 5.80 |
2012 | 720 | -136 | -19.4 | 6.10 |
% change | +6 | - | - | +5 |
Ex-div: 12 Dec Payment: 28 Jan *Includes intangible items of £248m, or 43p per share |