It hasn’t been an easy period for Revolution Bars (RNG), with management blaming flat like-for-like sales growth on the fact that New Year’s Eve trading was not included in its 2017 returns – revenue would othewise have improved by 1.9 per cent. The bar company also slid into an operating loss of £3.7m due to £9.6m-worth of exceptional costs, part of which were associated with the change of chief executive and the bidding war that engulfed Revolution Bars during the latter part of 2017.
In the end, nothing came to fruition after shareholders voted against management’s recommended offer from Stonegate Pub Company, and Deltic Group failed to come back with an all-cash bid. Revolution Bars had just issued a profit warning that sent its shares down 40 per cent before the bids kicked off. Management said the turning point was “better than expected” full-year results in October, which made shareholders think that the Stonegate offer undervalued the company.
Chief executive Keith Edelman added that it was not so much a difference of opinion that he thought led shareholders to vote against the deal, but more a difference of timing. The company's focus will now be on its planned openings rather than M&A.
Analysts at Peel Hunt expect adjusted pre-tax profits of £10m in the year to June 2018, giving EPS of 15.2p, up from £9.3m and 13.5p in FY2017.
| REVOLUTION BARS (RBG) | ||||
| ORD PRICE: | 165p | MARKET VALUE: | £83m | |
| TOUCH: | 161-165p | 12-MONTH HIGH: | 246p | LOW: 99p |
| DIVIDEND YIELD: | 2% | PE RATIO: | na | |
| NET ASSET VALUE: | 59p | NET DEBT: | 15% | |
| Half-year to 30 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 66.7 | 5.01 | 8.5 | 1.65 |
| 2017 | 73.8 | -3.96 | -6.8 | 1.65 |
| % change | +11 | - | - | - |
| Ex-div: | 22 Mar | |||
| Payment: | 12 Apr |
