Interim Results

City Pub Group PLC (The)
21 September 2023
 

The City Pub Group PLC
(the "City Pub Group", the "Company" or the "Group")

 

 INTERIM RESULTS FOR THE 26 WEEK PERIOD ENDED 25 June 2023

 

The City Pub Group is pleased to announce its unaudited results for the 26 week period to 25 June 2023. The Group operates a predominately freehold estate of 42 trading pubs and in addition has recently acquired a majority shareholding in Mosaic Pubs which have 9 pubs located in London and Birmingham and are predominantly freehold.

 

Since the last statement at the AGM in June, the business has continued to strengthen its financial position and trading has remained strong. This is despite the poor weather in July and early August and the continuation of train strikes. The Group enjoys one of the lowest levels of gearing in the whole hospitality sector with net debt of only c.£8.0m putting the Group in a very strong position to take advantage of appropriately priced opportunities in the market. Whilst our continued focus remains on delivering organic growth, we are currently engaged in negotiations on a number of acquisitions.

 

Our strategy to premiumise our offer is delivering increased sales and across our existing estate we have successfully sought further labour and purchasing costs efficiencies which have helped mitigate some, but not all, inflationary pressures. Looking forward, energy costs, pleasingly, will be considerably lower than last year with 60% of our energy now hedged to year end.

 

The second half of the year is traditionally the stronger trading period which benefits from more sporting activity including the Rugby World Cup, return of students from the end of September and the lucrative Christmas trading period. We will benefit from a 53rd week in this financial year.

 

H1 update

 

·    Positive trading momentum: revenue of £31.7 million (H1 2022: £26.1 million) and LFL sales up 14%

·    Despite inflationary pressures, pre-IFRS16 adjusted EBITDA* level maintained at  £3.3 million (H1 2022: £3.4 million). The comparatives benefited from c.£800k of state aid principally relating to lower VAT rates and business rates

·    Adjusted profit before tax** of £0.8 million (H1 2022: £1.3 million)

 

* Pre-IFRS16 Adjusted earnings before exceptional items, share option charge, interest, taxation, depreciation and amortisation.
** Pre-IFRS16 Adjusted profit / (loss) before tax is the profit / (loss) before tax, share option charge and exceptional items.

 

Current trading and Outlook

 

·    Trading across the summer since the half year end has remained positive and the Group continues to trade in line with full year expectations.

·    Anticipate continued trading momentum in H2 FY23 which benefits from a very active sporting calendar. Christmas bookings are ahead of where they were this time last year.

 

Clive Watson, Chairman of City Pub Group said:

 

"The Company is in a strong position with very low net debt and what we believe is amongst the lowest gearing in the sector. We look forward to a strong second half - Christmas bookings are significantly up and the company is well placed to take advantage of new acquisition opportunities. The Mosaic estate has been integrated and is showing significant increases in LFL sales. The economy remains challenging but we are well placed to take advantage of any future upturn.

 

21 September 2023

 

Enquiries:


City Pub Group                                
Clive Watson, Executive Chairman

Holly Elliott, CFO

 

Today: via Instinctif

Instinctif Partners                
Matthew Smallwood

 

+44 (0) 20 7457 2020

Liberum (Nomad & Joint Broker)

Chris Clarke

Edward Thomas

 

+44 (0) 20 3100 2000

 

Panmure Gordon (UK) Limited (Joint broker) Simon French

Ailsa Macmaster

Rupert Dearden

+44 (0) 20 7886 2500

 

For further information on City Pub Group pubs visit www.citypubcompany.com

 

 

CHAIRMAN'S STATEMENT

 

Since my last update at the AGM in June, the Group continues to strengthen its financial position. Sales volumes are continuing to improve; debt remains at historically very low levels and operational efficiencies continue to be delivered. I am pleased to announce that trading continues to be strong and for the first 6 months of 2023 LFL sales were up by 14% on 2022. The strong LFL performance is being driven by our strategy to further premiumise the estate and a continuous, relentless focus on customer service.

 

For the first 38 weeks of the year LFL sales are up 12.4% - this is very encouraging given the wet summer we have recently experienced and the recent ongoing train strikes. The Group continues to focus on organic sales growth and believes its strengthened marketing and sales teams will continue to drive further optimisation of existing retail space.

 

Due to the large number of freeholds in the estate, the Group has strong asset backing and good operating margins. The Company's debt level is at a historically low level, and its balance sheet is one of the lowest geared in the hospitality sector. The pub estate is very well invested requiring limited capital expenditure over the next 2 years. This will allow the Group to use its free cashflow to fund further acquisitions and share buybacks.

 

As the UK economy continues to adjust to higher interest rates, the Group continues to adopt a measured approach to its expansion programme. It believes its focus on organic growth and acquiring c.5 new pubs per annum will stand the business in good stead for when the economy starts to improve. The Board believes this is the right approach for a well-financed trading estate of premium pubs which can deliver sustained growth for shareholders.  

 

Trading Estate

 

The Group currently operates 42 trading sites (excluding Mosaic).

 

Since my last statement in June, we have continued to premiumise and enhance our existing estate, and we have upgraded the following pubs at a cost of £2m:

 

-     Cliftonville, Cromer - all the bedrooms are now refurbished to high standard and a new ballroom/function room

-     Georgian Townhouse, Norwich - significant improvement to garden and play area

-     Bow St Tavern - 4 trading levels have all been refurbished to increase capacity for group bookings

-     Market House, Reading - trading areas refurbished to more group bookings

-     Three Crowns, Old Street, Shoreditch - small refurbishment to premiumise the offer

-     The Cork, Bath - significant upgrade to the outside trading area, including more covered areas

 

Future refurbishments:

 

-     Pontcanna Inn - we now have planning permission for a covered seating area for over 150 people.

 

Acquisitions/disposals

 

The Group acquired a new pub, The Bridge located in Barnes for £0.5m. The purchase completed on 9 January 2023.

 

The Group disposed of The Yard surrendering the lease with the sale completing on 24 March 2023.

 

Mosaic Investments

 

In June, we succeeded in securing control  of Mosaic Pub and Dining Group Tranche 1 through owning 53% of the equity. City Pub Group will make a further offer to the remaining shareholders before the end of the tax year, i.e. April 5th 2024.  Mosaic operates 9 high quality pubs of which  6 are in London and 3 in Birmingham. 7 are freehold and 2 are leasehold. These are being integrated into the City Pub trading estate. We anticipate future sales growth from these pubs and cost savings. Whilst the Mosaic Group is well invested, we anticipate some investment in refurbishment to enhance trading performance.

 

Financial Highlights

 

Summary for the 26 weeks ended 25 June 2023:

 

• Revenue up 21% to £31.7 million (H1 2022: £26.1 million)

• Pre-IFRS 16 adjusted EBITDA* of £3.3 million (H1 2022: £3.4 million)

• Adjusted profit before tax** of £0.8 million (H1 2022: £1.3 million)

• Reported loss of £0.8 million (H1 2022: profit £0.1 million)

 

Key Metrics

 




 









Post IFRS 16

Pre IFRS 16

Post IFRS 16

Pre IFRS 16



26 weeks to

26 weeks to

26 weeks to

26 weeks to

Change


25.06.23

25.06.23

26.06.22

26.06.22

Pre IFRS 16


£m

£m

£m

£m

%

Revenue

31.7

31.7

26.1

26.1

21%

Adjusted EBITDA

4.4

*3.3

4.4

*3.4

-3%

Adjusted Profit before tax

0.8

**0.8

1.2

**1.3

-34%

 

*Pre-IFRS16 Adjusted earnings before exceptional items, share option charge, interest, taxation, depreciation and amortisation.
 **Pre-IFRS16 Adjusted profit / (loss) before tax is the profit / (loss) before tax, share option charge and exceptional items
.

 

Our strong trading figures are the result of having a premium well invested pub estate, however it should be noted that the Group benefited from c.£800k of state aid in the form of lower VAT and lower business rates. The second half of the year is traditionally the stronger trading period which benefits from more sporting activity including the Rugby World cup, return of students from mid-September and the lucrative Christmas trading period. We benefit from a 53rd week in this financial year.

 

Bank Facilities/NAV

 

Current net debt is c. £.8.0 million and the Director's valuation of the pub estate, now including the Mosaic Pubs is c.£171 million. Using that valuation as a benchmark, Net Asset Value is c.155p per share.

We have undrawn credit facilities of £26 million, and the Group operating comfortably within its banking covenants.

 

ESG

 

The ESG Committee, established in 2021, chaired by Emma Fox, continues its work realising the Group's  ESG Strategy to operate as a responsible and transparent business. The Company continues to engage with ESG consultancy, Inspired, to produce ESG reporting for the third year, including an annual ESG Report, reporting against the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) and a standalone TCFD Report. Both the ESG Report and TCFD Report are available on the Company's website. As a PLC, the Company also complies with Energy Saving Opportunity Scheme (ESOS) and reports annually under Streamlined Energy and Carbon Reporting (SECR), which enables the Group to assess and report on energy usage, associated emissions, energy efficiency action and energy performance. City Pub Group voluntarily participates in Carbon Disclosure Project (CDP), which helps us measure and manage our environmental impacts. This year's disclosure will be available in early 2024.

 

The ESG Committee meets at least bi-annually to monitor and evaluate various ongoing projects under the ESG strategy, including:

 

-     CAPEX and behavioural change energy efficiency project

-     Community engagement initiatives

-     Charitable work

-     Mandatory and voluntary ESG reporting

-     Development of ESG policies

-     Stakeholder engagement with the Company's ESG journey

 

Net Zero

 

The Board agreed to set an ambitious target of being Net Zero by 2040, ahead of Government's commitment of 2050. We further plan to achieve Net Zero for operational emissions (Scope 1&2) by 2035, with great progress being made thanks to the commitment to procuring 100% renewable electricity. We are continuously investing in energy saving solutions to further cut energy use and phase out natural gas from our pubs. Ongoing projects include, smart metering, cellar and refrigeration sensors, secondary glazing and engagement workshops with pub managers.

 

Share Buybacks/Dividends

 

Since starting the Share Buyback Programme the Group has purchased c.1.6m shares (c.1.5% of the issued share capital) at a cost of c.£1.3m. The Group will continue the Share Buyback Programme whilst the value  of the shares continue to trade at large discounts to NAV.

 

Industry Issues

 

Energy prices have continued to fall, resulting in  our  energy bill for this financial year reducing by £1m  from £3m in 2022 to £2m. The Group has hedged 60% of its energy cost until year end, minimising any future risks.

 

High food inflation has impacted margins. We also anticipate that labour costs will  continue to rise in line with general inflation, meaning that the Group continually has to look at labour saving measures across its operations and head office to mitigate rising employee costs. The government continues to tax our industry particularly  harshly with its recent duty increases on wine, spirits and bottled beer. Business rates continue to discriminate against businesses that operate from premises in city centres and other urban areas.  We continue to call on the  Government to address the unfairness in the business rates system where  pubs pay considerably more as % of sales than big online retailers.

 

Outlook

 

The Group remains in a very strong financial position with low levels of bank debt and operational gearing, as well as owning a predominantly freehold pub estate (63%). From a retail perspective, we continue to premiumise our offer and aim to achieve further organic growth from the existing estate. We seek  to become as efficient as possible without compromising our levels of hospitality  through further savings across the estate, whether it be better use of energy as a result of our ESG approach, better labour scheduling or  improved development of our food menus.

 

The market for pubs has now become more realistic and whilst our continued focus remains on delivering organic growth, we are currently engaged in negotiations on a small number of appropriately priced acquisitions.

 

The ambition within City Pub Group remains strong.  We have an experienced and committed head office team whose focus is to make City Pub Group one of the best independent pub retailers on the market. All our retail staff are incentivised with a weekly bonus which not only helps improve their renumeration  but encourages them to engage in an entrepreneurial way.

 

The pub sector, despite all challenges it has faced in the last 3-4 years, remains resilient. Undoubtedly, there will be winners and losers going forward. Those pub groups that embrace technological change will be able to further increase their market share and increase returns for their shareholders. As a Group we are focused on being innovative, improving sales per square foot, generating a high level of operating margins and retaining  a strong freehold backed balance sheet with low levels of bank debt.

 

The Group continues to improve its financial strength - it has a clear vision of where it wants to be over the medium term. We are targeting an estate of c.60 quality pubs located in some of the greatest cities across England and South Wales.

 

City Pub group has become very adept at reacting quickly where we need to, to minimise risk and take advantage of opportunities.

 

Bookings for H2 FY23 are looking strong, particularly around the Rugby World Cup and the important Christmas trading period and I look forward to updating shareholders with our trading statement in January 2024.

 

Clive Watson

Executive Chairman

21 September 2023

 

 

 

Consolidated Statement of Profit or Loss

For the 26 weeks ended 25 June 2023

 

 













Unaudited

 

Unaudited


Audited


 




26 weeks ended

 

26 weeks ended


52 weeks ended


 




25 June 2023

 

26 June 2022


25 December 2022


 


Notes

 

£'000

 

£'000


£'000


 










 

Revenue

 

 

31,650

 

26,127


57,793


 

Costs of sales



 (7,755)

 

 (6,285)


 (14,063)


 

Gross profit

 


23,895

 

19,842


43,730


 

Other operating income

2


70

 

184


239


 

Administrative expenses

 


 (23,957)

 

 (19,350)


 (42,542)


 

Operating profit

 


 8

 

 676


 1,427


 










 

Reconciliation to adjusted EBITDA*

 


 





 

 

Operating profit



 8

 

 676


 1,427


 










 

Depreciation

7 & 8

 

2,713

 

2,571


5,174


 

Share option charge

 

 

971

 

419


1,042


 

Exceptional items

3

 

664

 

714


2,439

 

 




 

 





 

*Adjusted earnings before exceptional items, share option charge, interest, taxation and depreciation

 


4,356

 

4,380


10,082

 

 

 


 





 

 

 









 

Share of losses of associates and joint ventures



(225)

 

(76)


(157)


 

Finance costs



 (598)

 

 (523)


 (1,054)


 

(Loss)/profit before tax

 


(815)

 

 77


216


 

Tax credit

4


-

 

-


735


 

(Loss)/profit for the period and total comprehensive income

 


 (815)

 

 77


 951


 


 








 

(Loss)/earnings per share

 








 

Basic (loss)/earnings per share (p)

5


(0.79)

 

0.07


 0.92


 

Diluted earnings per share (p)

5


n/a

 

0.07


 0.89


 


 








 

 

All activities comprise continuing operations.

 

The accompanying notes are an integral part of these interim financial statements.

 

 

Consolidated Statement of Comprehensive Income

For the 26 weeks ended 25 June 2023

 

 




Unaudited

 

Unaudited


Audited




26 weeks ended

 

26 weeks ended


52 weeks ended




25 June 2023

 

26 June 2022


25 December 2022




£'000

 


£'000









(Loss)/profit for the period

 


(815)

 

77


 951









Other comprehensive income

 







Items that will not be reclassified to profit or loss

 






Changes in the fair value of equity investments at fair value through other comprehensive income



 (105)

 

 (225)


(494)








Income tax relating to these items



26

 

56


 123

Other comprehensive income for the period, net of tax

 


 (79)

 

 (169)


(371)









Total comprehensive income for the period

 


 (894)

 

 (92)


 580

















 

All of the total comprehensive income for the period is attributable to the owners of The City Pub Group plc and all arise from continuing operations.

 

The accompanying notes are an integral part of these interim financial statements.

 

 

Consolidated Statement of Financial Position

As at 25 June 2023

 




Unaudited

 

Unaudited


Audited

 




26 weeks ended

 

26 weeks ended


52 weeks ended

 




25 June 2023

 

26 June 2022


25 December 2022

 

Assets

Notes

 

£'000

 

£'000


£'000

 

Non-current

 







 

Intangible assets

 

 

2,880

 

2,250


2,450

 

Property, plant and equipment

7

 

99,576

 

93,641


99,065

 

Right-of-use assets

8

 

17,228

 

16,354


17,565

 

Deferred tax assets

 

 

1,869

 

1,071


1,843

 

Financial assets at fair value through OCI

 

 

281

 

655


386

 

Investments in associates & joint ventures

 

 

7,413

 

6,068


6,004

 

Total non-current assets

 

 

129,247

 

120,039


127,313

 

Current

 

 






 

Inventories

 

 

1,101

 

921


1,152

 

Trade and other receivables

 

 

4,080

 

4,439


3,659

 

Cash and cash equivalents

 

 

5,813

 

3,805


4,121

 

Total current assets

 

 

10,994

 

9,165


8,932

 

Total assets

 

 

140,241

 

129,204


136,245

 

Liabilities

 

 






 

Current liabilities

 

 






 

Trade and other payables

 

 

 (16,850)

 

 (11,758)


 (13,931)

 

Financial liabilities - lease liabilities



 (2,040)


 (1,863)


 (1,915)

 

Total current liabilities

 

 

 (18,890)

 

 (13,621)


 (15,846)

 

Non-current

 

 






 

Borrowings

 

 

 (9,744)

 

 (5,630)


 (7,657)

 

Financial liabilities - lease liabilities



 (16,238)


 (15,078)


 (16,674)

 

Deferred tax liabilities

 

 

 (2,445)

 

 (2,460)


 (2,445)

 

Total non-current liabilities

 

 

 (28,427)

 

 (23,168)


 (26,776)

 

Total liabilities

 


 (47,317)

 

 (36,789)


 (42,622)

 

Net assets

 


92,924

 

92,415


93,623

 

Equity

 







 

Share capital

9


31,281

 

31,276


31,276

 

Share premium

9


59,475

 

59,475


59,475

 

Own shares



 (2,015)

 

 (3,272)


 (3,359)

 

Other reserve



1,231

 

2,434


2,855

 

Retained earnings



2,952

 

2,502


3,376

 

Total equity

 


92,924

 

92,415


93,623

 

 









 

The accompanying notes are an integral part of these interim financial statements.

 

 

Consolidated Statement of Changes in Equity

For the 26 weeks ended 25 June 2023



Share capital
£'000

 

Share premium
£'000

 

Own shares

£'000

 

Other reserve
£'000

 

Retained earnings
£'000

 

Total
£'000

 













Balance at 26 December 2021 (Audited)

 

31,276


59,475


 (3,272)


2,184


2,425


92,088














Employee share-based compensation


-


-


-


419


-


419

Transactions with owners

 

-


-


-


419


-


419














Profit for the period


-


-


-


-


 77


 77

Other comprehensive income








(169)


-


(169)

Total comprehensive income for the period

 

-


-


-


(169)


 77


 (92)














Balance at 26 June 2022 (Unaudited)

 

31,276


59,475


 (3,272)


2,434


2,502


92,415














Employee share-based compensation


-


-


-


623


-


623

Purchase of own shares


-


-


(87)


-


-


 (87)

Transactions with owners

 

-


-


(87) 


623


-


536














Profit for the period


-


-


-


-


874


874

Other comprehensive income


-


-


-


(202)


-


(202)

Total comprehensive income for the period

 

-


-


-


(202)


874


672














Balance at 25 December 2022 (Audited)

 

31,276

 

59,475

 

 (3,359)

 

2,855

 

3,376

 

93,623

 













Employee share-based compensation


-


-


-


971


-


971

Share options exercised or expired


-


-


2,125


(2,516)


391


-

Purchase of own shares


-


-


(781)


-


-


(781)

Issue of new shares


5


-


-



-


5

Transactions with owners

 

5


-


1,344


(1,545)


391


195














Loss for the period


-


-


-


-


 (815)


(815)

Other comprehensive income


-


-


-


(79)


-


(79)

Total comprehensive income for the period

 

-


-


-


(79)


 (815)


 (894)














Balance at 25 June 2023 (Unaudited)

 

31,281

 

59,475

 

 (2,015)

 

1,231

 

2,952

 

92,924

 













 

The accompanying notes are an integral part of these interim financial statements.

 

 

Consolidated Statement of Cashflows

For the 26 weeks ended 25 June 2023



Unaudited

 

Unaudited


Audited



26 weeks ended

 

26 weeks ended


52 weeks ended



25 June 2023

 

26 June 2022


25 December 2022



£'000

 

£'000


£'000

Cash flows from operating activities

 

 





(Loss)/profit for the period

 

 (815)


 77


951

Taxation


 -


 -


 (735)

Finance costs


598


523


1,054

Results from equity accounted investment


225


76


157

Operating profit

 

 8


 676


 1,427

Adjustments for:


 





Depreciation


2,713


2,571


5,174

Gain on disposal of property, plant and equipment


(123)


-


(58)

Share-based payment charge


971


419


1,042

Negative goodwill amortisation


(257)


-


-

Impairment


413


-


627

Change in inventories


 51


 127


(104)

Change in trade and other receivables


 (537)


 (1,108)


(668)

Change in trade and other payables


2,978


(454)


 1,723

Cash generated from operations


6,217


2,231


9,163

Tax received


130


-


 53

Net cash generated from operating activities

 

6,347


2,231


9,216



 





Cash flows from investing activities

 

 





Purchase of property, plant and equipment


 (2,709)


 (4,715)


 (10,262)

Acquisition of new property sites


(550)


-


(2,045)

Purchase of investments & associates (net of cash acquired)


 (1,359)


 (2,522)


 (2,539)

Proceeds from disposal of property, plant and equipment


-


16,687


16,977

Net cash (used in)/generated from investing activities

 

 (4,618)


 9,450


 2,131



 





Cash flows from financing activities

 

 





Purchase of own shares


(781)


-


(87)

Proceeds/(repayment) of borrowings


2,000


(19,151)


 (17,169)

Principal elements of lease payments


 (658)


 (648)


 (1,362)

Interest paid (includes implied interest under IFRS 16)


 (598)


 (587)


 (1,118)

Net cash used in financing activities

 

 (37)



(19,736)



 





Net change in cash and cash equivalents

 

 1,692


 (8,705)


(8,389)

Cash and cash equivalents at the start of the period


4,121


12,510


12,510

Cash and cash equivalents at the end of the period

 

5,813


3,805


4,121








 

The accompanying notes are an integral part of these interim financial statements.

 

 

Notes to the Financial Statements

For the 26 weeks ended 25 June 2023

 

1       Basis of preparation

This interim report was approved by the board on 21 September 2023. The interim financial statements are unaudited and are not the Group's statutory accounts as defined in section 434 of the Companies Act 2006.

 

The consolidated interim financial statements have been prepared under IFRS as adopted by the United Kingdom and on the basis of the accounting policies set out in the statutory accounts of The City Pub Group plc, for the period ended 25 June 2023. The financial statements have not been prepared (and are not required to be prepared) in accordance with IAS 34: 'Interim Financial Reporting'. They do not include any of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Group for the period ended 25 December 2022.

 

Statutory accounts for the period ended 25 December 2022 have been delivered to the Registrar of Companies. These accounts contain an unqualified audit report under Section 495 of the Companies Act 2006, which did not make any statements under Section 498 of the Companies Act 2006.

 

The interim report is presented in Great British Pounds and all values are rounded to the nearest thousand pounds, except where otherwise indicated.

 

This interim report has been prepared in accordance with the AIM Rules issued by the London Stock Exchange.

 

2        Other operating income

During the interim period the Group has continued to receive Government grants in relation to grants received from Councils. Further analysis of other operating income is set out below.

 

 



Unaudited

 

Unaudited


Audited

 

 



26 weeks ended

 

26 weeks ended


52 weeks ended

 

 



25 June 2023

 

26 June 2022


25 December 2022

 

 



£'000

 

£'000


£'000

 

 

Other government grants


70

 

184


239

 

 



70

 

184


239

 








 

3        Exceptional items

 



Unaudited

 

Unaudited


Audited

 

 



26 weeks ended

 

26 weeks ended


52 weeks ended

 

 



25 June 2023

 

26 June 2022


25 December 2022

 

 



£'000

 

£'000


£'000

 

 

Pre opening costs


-

 

295


575

 

 

Impairment of a pub site


413

 

-


627

 

 

Receivables impairments


-

 

89


-

 

 

Release of negative goodwill


(257)

 

-


-

 

 

Site disposals


147

 

-


962

 

 

Other non recurring items


361

 

330


275

 

 



664

 

 714


2,439

 








For the purposes of this interim announcement and annual report and accounts, Exceptional items are highlighted as part of the use of alternative non-Generally Accepted Accounting Practice ('non-GAAP') financial measures which are not defined within IFRS. The Directors use these measures in order to assess the underlying operational performance of the Group and as such, these measures are important and should be considered alongside the IFRS measures.

 

All the exceptional items are recorded within administrative expenses line in the statement of profit or loss.

 

4        Tax charge on (loss)/profit on ordinary activities








During the period ended 25 June 2023, deferred tax arising on accelerated capital allowances is considered to be offset by increases in available tax losses and therefore no tax charge or credit has been recognised in the consolidated profit and loss (26 June 2022: £nil).

 

5        (Loss)/earnings per share

 

 



Unaudited

 

Unaudited


Audited

 



26 weeks ended

 

26 weeks ended


52 weeks ended

 



25 June 2023

 

26 June 2022


25 December 2022

 



£'000

 

£'000


£'000

 

(Loss)/earnings for the period attributable to Shareholders







 


(815)

 

 77


 951

 



 





 

(Loss)/earnings per share:

 

 





 

Basic (loss)/earnings per share (p)


(0.79)

 

0.07


 0.92

 

Diluted earnings per share (p)


n/a

 

 0.07


0.89

 



 





 

Weighted average number of shares:

 

Number of shares

 

Number of shares


Number of shares

 





 

Weighted average shares for basic EPS


103,246,583

 

103,868,430


103,845,560

 

Effect of share options in issue


n/a

 

5,054,524


3,524,886

 

Weighted average shares for diluted earnings per share


n/a

 

108,922,954


107,370,446



 

 





6        Dividends

 

The Directors did not propose a dividend in relation to the year ended 25 December 2022 as the Directors believe share buybacks are an efficient way of creating shareholder value (2021: Nil).

 

7        Property, plant and equipment



Freehold & leasehold property

 

Fixtures, fittings and computers

 


Group

 








Total

Cost

 

£'000

 

£'000

 

£'000

At 26 December 2021 (Audited)

 

96,612


34,947


131,559

Additions

 

1,169


3,610


4,779

Disposals


(17,121)


 (2,982)


 (20,103)

At 26 June 2022 (Unaudited)

 

80,660

 

35,575

 

116,235

Additions


358


5,189


5,547

Acquisitions


1,395


450


1,845

Disposals


 (584)


(803)


 (1,387)

At 25 December 2022 (Audited)

 

81,829

 

40,411

 

122,240

Additions


37


2,672


2,709

Reclassifications


6,254


(6,254)


-

Acquisitions


40


80


120

Disposals


(555)


 (1,191)


 (1,746)

At 25 June 2023 (Unaudited)

 

87,605

 

35,718

 

123,323

 







Depreciation

 






At 26 December 2021 (Audited)

 

6,007


18,185


24,192

Provided during the period

 

423


1,397


1,820

Disposals


(1,294)


 (2,124)


 (3,418)

At 26 June 2022 (Unaudited)

 

5,136

 

17,458

 

22,594

Provided during the period


312


1,499


1,811

Impairment


189


47


236

Disposals


(813)


(653)


(1,466)

At 25 December 2022 (Audited)

 

4,824

 

18,351

 

23,175

Provided during the period


407


1,556


1,963

Impairment


413


-


413

Disposals


(582)


 (1,222)


 (1,804)

At 25 June 2023 (Unaudited)

 

5,062

 

18,685

 

23,747

 







Net book value

 






At 25 June 2023 (Unaudited)

 

82,543

 

17,033

 

99,576

At 25 December 2022 (Audited)


77,005


22,060


99,065

At 26 June 2022 (Unaudited)


75,524


18,117


93,641

At 26 December 2021 (Audited)


90,605


16,762


107,367








 

17 freeholds were independently valued in March 2022. These properties were valued at c.£98m and are valued at historic cost per the financial statements. The uplift per the independent valuation is not reflected.

 

8        Right-of-use assets

 



Right-of-use assets



Net book value

 

£'000

At 26 December 2021 (Audited)

 

17,875

Additions

 

 -

Disposals

 

(770)

Depreciation

 

(751)

At 26 June 2022 (Unaudited)

 

16,354

Additions

 

3,568

Disposals

 

(1,174)

Impairment

 

(391)

Depreciation

 

(792)

At 25 December 2022 (Audited)

 

17,565

Additions

 

 997

Disposals

 

(584)

Depreciation

 

(750)

At 25 June 2023 (Unaudited)

 

17,228

 






The addition during the current period relates to the purchase of The Bridge, Barnes. The disposal during the current period relates to The Yard, Chelsea, and therefore no ongoing ROU asset required.

 

9        Share capital

 

During the period the Group issued 500,000 ordinary shares with a nominal value of £0.01, which were unpaid at the period end (2022: £nil).

 

 

10      Share buyback

 

As at 25 June 2023, the Group has purchased 1.064m shares at a cost of c.£863k. The Group will continue the Share Buyback programme if the level of shares continues to trade at large discounts to NAV.

 

11      Grant of options

 

On 21 June 2023, the Group granted awards in the form of nil cost options over 1,585,000 ordinary shares of 1p each to certain Directors and employees. The Options have been granted under the Company's Long Term Incentive Plan (LTIP), are exercisable in 2026 following release of the Company's audited accounts for the year ended 31 December 2025, are subject to performance conditions relating to the Company's EBITDA profitability (pre-IFRS 16) and have a 10-year term.

 

 

12      Events after the reporting period

 

During April 2023, the Group increased its' shareholding in Mosaic Pub and Dining (Tranche one of companies - The Sovereign (City) Pub Company Limited, The Galaxy (City) Pub Company Limited and The Pioneer (City) Pub Company Limited) from 36% to 44% for a consideration of c£1.6m. Further shares were purchased in May 2023 for a consideration of c£400k, bringing the total shareholding up to 46%.

 

Following the period ended 25 June 2023, the Group acquired further shares and now own a 53% shareholding in Mosaic Tranche 1. The Group gained operational control of Mosaic Tranche 1 from 26 June 2023, due to the appointment of Rupert Clark and Holly Elliott as directors of the companies.

 

The Group continued the share buyback programme following the period ended 25 June 2023 and purchased a further 547,299 shares at a cost of £479,703.

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