An unlikely picture of the economic divide between north and south in the UK is apparent in the latest numbers from Enterprise Inns (ETI). In its largest division, only pubs in the south saw a net income rise in the half-year. This was enough to move the dial up 1.8 per cent for the group as a whole though, and chief executive Simon Townsend said trends in the north and the Midlands were improving.
The big distraction is imminent government legislation freeing publicans from the beer tie and allowing them to pay rent only. The laws are being marginally delayed due to parliamentary drafting errors, Mr Townsend said, but 150-200 pubs in Enterprise's stable will have the chance to opt to go it alone this financial year. This rises to 600 next year, but management is confident its partnership tenancy plus agreement, which will go beyond what the existing tied deal offers, will entice landlords.
Elsewhere, unplanned business failures were down 9 per cent partly due to the £3m in financial assistance given to pubs in the first half, while its growing managed division should hit 105 sites by September - an encouraging start on its journey to 800 by 2020.
Panmure Gordon expects adjusted pre-tax profits for the year to September 2016 of £120.6m leading to EPS of 19.2p compared to £121.9m and 19.4p in FY2015.
| ENTERPRISE INNS (ETI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 91.75 | MARKET VALUE: | £462m | |
| TOUCH: | 91.25-91.75p | 12-MONTH HIGH: | 136p | LOW: 70p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 277p* | NET DEBT: | 163% | |
| Half-year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 302 | 10 | 0.9 | - |
| 2016 | 305 | 40 | 6.6 | - |
| % change | +1 | +300 | +633 | - |
Ex-div: na Payment: na *Includes intangible assets of £327m, or 65p a share | ||||
