Enterprise Inns (ETI) doesn't want to be left with a hangover when the government's legislation aimed at freeing tied publicans takes effect next summer. Management's plan to tackle the changes, which was announced alongside the interim results, is already budding. The number of managed pubs has risen from 16 in May to 35 at the end of September, and the group's portfolio of commercial properties now runs to 213 sites, from 185 six months ago.
The company is expecting some 200 pubs to opt for the 'market rent only' option in the current financial year to September 2016, and some 600 per year to take the plunge after that. Chief executive Simon Townsend said many publicans were "keeping their cards close to their chest" as to what they might do. But he is hoping that the £69m invested by Enterprise in its estate in the year will help keep landlords interested in so-called 'wet rent'.
An 18 per cent reduction in business failures supported like-for-like net income growth of 0.8 per cent for the year. But 260 pubs were sold, so revenues and adjusted cash profits fell overall. Reported profits were hit by £163m in property write-downs.
Analysts at Numis expect pre-tax profits of £122.5m this financial year, giving EPS of 19.9p, compared with £122m and 19.4p in FY 2015.
| ENTERPRISE INNS (ETI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 100p | MARKET VALUE: | £ 506m | |
| TOUCH: | 99.7-100.1p | 12-MONTH HIGH: | 140p | LOW: 95p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 266p* | NET DEBT: | 172% | |
| Year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 711 | -14.0 | 4.8 | nil |
| 2012 | 692 | 34.0 | 8.8 | nil |
| 2013 | 639 | -42.0 | -0.8 | nil |
| 2014 | 632 | 36.0 | 5.9 | nil |
| 2015 | 625 | -71.0 | -13.0 | nil |
| % change | -1 | - | - | - |
Ex-div:n/a Payment:n/a *Includes intangible assets of £340m or 67p a share | ||||
