Coronavirus Update

Young & Co's Brewery - Preliminary Results

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YOUNG & CO.'S BREWERY, P.L.C.

PRELIMINARY RESULTS FOR THE 52 WEEKS ENDED 30 MARCH 2020

All of the results above are from continuing operation

(1)  The 2020 results have been reported under IFRS 16. The 2019 comparatives have not been restated, as permitted by the accounting standard. The 2020 pre-IFRS 16 results, which are for comparative purposes only, have been presented on a non-statutory illustrative basis excluding the impact of IFRS 16. Refer to the business and financial review for details.

(2)  Reference to an "adjusted" item means that item has been adjusted to exclude non-underlying costs of £8.6 million (2019: non-underlying costs of £3.9 million) (see note 4).

(3)  Net assets per share are the group's net assets divided by the shares in issue at the period end.

PERFORMANCE HIGHLIGHTS

(The 2020 highlights are shown on a pre-IFRS 16 basis for comparative purposes)

  • The coronavirus pandemic has had a significant impact on these results. Closure of our pubs for the final 10 days of the financial year and the preceding downturn in trade resulted in an estimated £13.0 million shortfall in revenue, with a disproportionate impact on profits, estimated to be £7.7 million due to the limited opportunity for mitigating actions
  • Total group revenue up 2.6% to £311.6 million. Managed house revenue up 3.0% to £299.1 million, supported by a significant contribution from the Redcomb pubs following their acquisition in January last year; like-for-like sales down 2.4%
  • Managed house adjusted operating profits down 5.0% to £58.4 million; Ram Pub Company adjusted operating profit was £4.1 million, down by £0.9 million
  • Total investment of £70.8 million including significant upgrades to our existing estate as well as the acquisition of five premium businesses in and around our south-west London heartland and the Surrey suburbs;
  • Operating cash flow down to £64.7 million - net debt to adjusted EBITDA is at 2.8 times despite downturn in trade due to coronavirus, and timing of acquisitions late in the financial year;
  • The Board decided it was not appropriate to recommend payment of the final dividend given the focus on cash conservation in these extraordinary times, resulting in a total dividend of 10.57 pence (2019: 20.78 pence); and
  • Improved liquidity as a result of arranging £50.0 million of additional funds and committed facilities. We have agreed with our lending banks to replace existing covenant tests with a £20.0 million available liquidity test through to and including the quarter end in June 2021.

Patrick Dardis, Chief Executive of Young's, commented

"I am proud of the performance of our business this year despite the unique challenges that we have faced. These results demonstrate the continued strength of our strategy of operating a differentiated, premium and well-invested pub estate."

"The purchase of five of the finest pubs in and around our south-west London heartland and the Surrey suburbs was a real stand out acquisition for us. Their premium offer is a perfect fit for Young's."

"We are grateful for the positive moves made by the Chancellor, extending the Job Retention Scheme to October and the £14.5 million relief we will receive from the business rates holiday to ensure that great businesses like ours survive these particularly tough times."

"We are confident with the steps we have taken to safeguard our business from the immediate threat of coronavirus. The board expects the business to be in a position to return to profitable growth when this unprecedented period is at an end and conditions allow, and we remain confident in our proven strategy."