MARSTON’S PLC
PRELIMINARY RESULTS FOR THE 52 WEEKS ENDED 30 SEPTEMBER 2023
IMPROVED UNDERLYING PROFITABILITY, POSITIVE CASH FLOW AND CONTINUED STRATEGIC MOMENTUM
Marston’s, a leading UK operator of 1,414 pubs, today announces its Preliminary Results for the 52 weeks ended 30 September 2023. The period under review commenced on 2 October 2022.
| Underlying | Total | |||
| 2023 | 2022 | 2023 | 2022 | |
| Total revenue | £872.3 m | £799.6 m | £872.3 m | £799.6 m |
| Pub operating profit | £124.8 m | £115.4 m | £90.2 m | £142.1 m |
| Share of associate | £9.9 m | £3.3 m | £9.9 m | £3.3 m |
| Profit/(loss) before tax | £35.5 m | £27.7 m | £(20.7) m* | £163.4 m |
| Net profit/(loss) | £32.0 m | £27.5 m | £(9.3) m | £137.2 m |
| Earnings/(loss) per share | 5.1 p | 4.3 p | (1.5)p | 21.7p |
| Net cash inflow | £34.4 m | £26.2 m | £34.4 m | £26.2 m |
| NAV per share | £1.01 | £1.02 | ||
| Underlying operating margin | 14.3% | 14.4% | ||
*Includes a £21.6 million net loss in respect of interest rate swap movements, a partial reversal of the £109.2 million net gain reported in FY2022, and £31.2 million of charges in respect of the impairment of freehold and leasehold properties.
Revenue and underlying pub operating profit growth, despite macroeconomic environment
· Continued progress on ‘Back to a Billion’ sales and net debt targets, with revenue up 9.1% to £872.3 million
· Like-for-like sales up 10.1% vs last year
· Both drink and food sales were encouraging, demonstrating the trading resilience of the Group’s predominantly community pub estate
· 8% increase in underlying pub operating profit: £124.8 million (FY2022: £115.4 million)
· Underlying operating margin effectively flat at 14.3% (2022: 14.4%), preserving margins in a high inflation environment
· Improved share of CMBC’s profits: £9.9 million (FY2022: £3.3 million) and £21.6 million of dividends received
Positive cash generation and debt reduction
· Operating cash inflow of £141.2 million (FY2022: £134 million) and net cash inflow for the period of £34.4 million (FY2022: £26.2 million)
· Continued progress with debt reduction strategy: net debt excluding IFRS 16 lease liabilities reduced by £31 million to £1,185 million (FY2022: £1,216 million)
· £54.5 million generated from non-core strategic disposals, proceeds ahead of net book value
· Successfully secured amendment and extension of banking facilities totalling £340 million, comprising £300 million RCF and £40 million private placement
Continued evolution of pub portfolio
· Continued market outperformance with a well-positioned, predominantly freehold pub estate, with limited exposure to city centres, and community pubs continuing to benefit from consumer lifestyle changes
· Simplified pub estate evolution delivering positive momentum with food and drink spend per head up 8.1% and 8.6% respectively and gross margin up 0.6%
· Successful trial of franchise-style model in food-led managed pubs; sales growth significantly exceeding that of the broader food business
· Completed 41 capital schemes and £4m garden investment; £50-55m of capex investment earmarked for FY2024
Current trading and outlook
· Positive current trading, with like-for-like sales since year end +7.4% vs. last year
· Christmas bookings tracking well and ahead of last year
· Continuing to manage inflationary challenges within our control: energy costs secured with electricity fixed until end of FY2024 and gas until end of March 2025; offsetting other costs through efficiencies and pricing strategies
· Improved business resilience: targeting margin improvement of at least 200bps in the medium term
· Over and above the progress already made, the Group will continue to find efficiencies to improve margin
· Justin Platt joins as CEO on 10 January 2024
Commenting, William Rucker, Chair said:
“We have continued to make positive progress on our key goals and strategic initiatives. The consumer has remained resilient despite the macro backdrop and Marston’s continues to trade well, achieving market outperformance.
We anticipate an improving outlook in which cost headwinds are largely abating and like-for-like sales are up over 7% since the year end. This, together with the actions we have taken this year to drive further efficiencies, leave us confident that Marston’s remains well-placed to continue to outperform and to grow revenue, margin and profitability.
We look forward to welcoming Justin Platt who joins the Group as CEO in January. The business is in good shape and well-positioned to take advantage of the future opportunities open to us to create value for our shareholders under his stewardship.“
ENQUIRIES:
| Marston’s PLC Tel: 01902 329516 | Instinctif Partners Tel: 020 7457 2020 |
| William Rucker, Chair | Justine Warren |
| Hayleigh Lupino, Chief Financial Officer | Matthew SmallwoodJoe Quinlan |
NOTES TO EDITORS
• Marston’s is a leading pub operator with a 40% holding in Carlsberg Marston’s Brewing Company
• It operates an estate of 1,414 pubs situated nationally, comprising managed, franchised and leased pubs
• Marston’s employs around 11,000 people
• The Group uses a number of alternative performance measures (APMs) to enable management and users of the financial statements to better understand elements of financial performance in the period. APMs are explained and reconciled in the appendix to the financial statements