Coronavirus reduced Marston’s (MARS) half year revenues by £40m, with the pub and brewing group forced to close its doors to customers on 21 March. It also recorded around £16m in costs prompted by Covid-19, which included debt provisions and changes to stock valuations. Marston's plans to open 85 to 90 per cent of its English pubs from 4 July.
That opening date can't come quickly enough, but the group had already taken measures to minimise capital outflows prior to the pandemic. Net cash flow from investment activities (less cash transfers) was up on the 2019 half-year, helped by the disposal of 168 pubs, which raised proceeds of around £61m, while capital expenditure came down by 39 per cent, largely due to the suspension of a new-build initiative agreed before the pandemic.
The group will raise more money through a joint venture with Carlsberg announced in May, which will see it receive £273m from the Danish giant - these funds will also go towards lowering debt, although £34m of the proceeds will be deferred and the amount paid depending on the share price recovery of Marston's, Mitchells & Butlers (MAB), Britvic (BVIC) and AG Barr (BAG) to pre- coronavirus levels.
Peel Hunt forecasts adjusted pre-tax losses and losses per share of £17.4m and 2.3p respectively for Sept 2020, before pre-tax profits and EPS of £56.6m and 7.4p in FY2021.
| MARSTON'S (MARS) | ||||
| ORD PRICE: | 62p | MARKET VALUE: | £ 393m | |
| TOUCH: | 61-62p | 12-MONTH HIGH: | 134p | LOW: 18p |
| DIVIDEND YIELD: | 7.7% | PE RATIO: | NA | |
| NET ASSET VALUE: | 115p* | NET DEBT: | £1.7bn** | |
| Half-year to 28 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 553 | 16.3 | 2.2 | 2.7 |
| 2020 | 511 | -33.2 | -4.4 | 0.0 |
| % change | -8 | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Includes intangible assets of £323m, or 51p a share **Includes lease liabilities of £320m | ||||
