Preliminary Announcement

Heavitree Brewery PLC

19 February 2026

 

The Heavitree Brewery PLC

Trood Lane

Matford

Exeter EX2 8YP

Date:                    19 February 2026

Contact:               Terry Wheatley Managing Director - 01392 217733

Nicola McLean Finance Director-Company Secretary - 01392 217733

Patrick Castle /Anita Ghanekar - Shore Capital - 0207 408 4052

Following a Board Meeting held today, 19 February 2026, the Directors announce the preliminary statement of results for the year ended 31 October 2025.

ISIN: GB0004182720 for 'A' Limited Voting Ordinary Shares

ISIN: GB0004182506 for Ordinary Shares

Chairman's statement

There is an element of repetition in my year-end and interim statements over recent years as I have warned of the many challenges facing pubs and our sector as a whole.  Although this Company has once again ridden the storm and returned a satisfactory set of results for the period, none of the much-reported pressures being felt by our tenants and leaseholders operating our pubs have gone away.  In fact, the list has been added to following the November Budget.  The resilience shown by our landlords and landladies, and their staff, to encourage trade and remain busy is commendable and I have been genuinely pleased by the levels of trade shown on my recent visits to some of our houses.  However, the Board is under no illusions as to how much profit margins are being squeezed from many directions and how, in turn, our operators are putting in long and exhaustive hours themselves to mitigate the cost of doing business.

Turnover has increased in the year by 1.7% to £7,628,000 (2024: £7,498,000).  Operating profit has decreased slightly by 3.3% to £1,377,000 (2024: £1,424,000).  This is due to an increase in payroll costs during the transition period following Terry Wheatley's appointment as Managing Director and Nicky McLean's appointment as Finance Director in February 2025 going hand in hand with Graham Crocker stepping back from both these roles but continuing as a full-time executive until April 2026, all as detailed in last year's statement.  Our programme of repairs this year has resulted in a reduced spend of £801,000 compared with the previous year (2024: £890,000).

Dividend

The Board recommends an unchanged final dividend of 3.85p (2024: 3.85p) for the year ended 31 October 2025 per Ordinary and "A" Ordinary Limited Voting Share to those shareholders on the register on 13th March 2026.  This final dividend is cautious for the reasons explained above but when added to the increased dividend paid at the half-year, represents an increase for the year of 8.1% which, subject to shareholder approval at the Annual General Meeting to be held on 15th April 2026, will be paid on 24th April 2026.

Chairman's statement (continued)

Property

A cash settlement has been received from insurers for the Jolly Sailor in East Ogwell which was destroyed by fire in 2020.  Planning permission for the site has been approved and the Company continues to liaise with representatives of the Parish Council to establish the best way to proceed and I look forward to reporting further at the half-year.

A fire damaged the stores and beer cellar at The Cleave in Lustleigh in October.  The installation of a temporary cellar unit has meant that there has not been an interruption to trading and our team is in conversation with insurers and the National Park Conservation Officer to ensure a rebuild can be carried out as soon as possible.  The Board is most grateful for the prompt action of both staff at the pub and the Fire Service who undoubtedly prevented the fire extending to the main body of the building.

Combined fixed assets sales, mainly comprising of the sale of the Locomotive Inn in Exeter which I reported on at the half-year, has resulted in a profit of £1,056,000.  Consideration of the carrying value at the old Heavitree Arms in Exmouth has resulted in an impairment of £200,000.

Five changes of tenancy and a lease assignment have completed during the year under review.  The Board wishes all these operators every success with their new ventures.  At the time of writing, we have just two tenancies available with interest being shown by potential new tenants at both sites.

Pension Scheme

As I reported at the half-year, the wind-up process of the Company's final salary pension scheme continues to move towards completion but frustratingly slowly.  The delay has been caused by the pace of work of the insurance companies who are charged with transferring annuities into individual member's own names.  Further frustration has been caused as the delay has resulted in the necessity to produce a full set of accounts for the scheme and with them, of course, comes the associated cost.  I know I have reported the same before, but we really are very close to the finish line.

Personnel

Michael Jordan retired in January from his role as Contracts' Manager of our building maintenance department having joined the Company in 2005.  Mike has combined his skills, dedication and leadership whilst fulfilling his role and has always been immensely popular both at Head Office and throughout the estate. He leaves after a year of expertly controlled spending for the department and our pubs looking their best.  I am sure all shareholders would like to join the Board in thanking Mike and wishing him an extremely happy retirement.

Mike's retirement means the Board would like to extend the warmest of welcomes to Jason Hartnell who has joined the Company to lead the department.  I would also like to thank both Mike and Jason for achieving such a smooth transition in this part of our business.

Prospects

A customer might walk into a well-frequented local and enjoy a wonderful experience, and perhaps reflect afterwards that the pub was as good and busy as ever, so what are they worrying about?  The concerns are for the multi-pronged attack on their business: there is an RPI indexed alcohol duty increase coming soon, there are pressures from energy and food costs and increased employer's national insurance, and also new legislation connected to worker's rights and an increase in the minimum wage.  Perhaps top of the list was the threat of an increase in business rates which was thinly disguised as a reduction when it was announced in the November budget. The resulting uproar afterwards followed by intense lobbying from trade bodies resulted in the announcement of a climbdown.  We then had many weeks of speculation as to what the Treasury was going to announce next as it tried to make amends.  The uncertainty alone was most unhelpful.

N H P TUCKER
Chairman

19 February 2026

Income Statement

for the year ended 31 October 2025

	Notes	Total 2025 £000	Total 2024 £000
Revenue		7,628	7,498
Other operating income		285	294
Purchase of inventories		(3,006)	(2,982)
Staff costs		(1,650)	(1,505)
Depreciation of property, plant and equipment		(172)	(222)
Other operating charges		(1,708)	(1,659)
		(6,251)	(6,074)
Operating profit		1,377	1,424
Profit on sale of property plant and equipment Impairment of fixed assets Insurance receipt (Jolly Sailor)		1,056    (200)     877	308  - -
Profit before finance costs and taxation		3,110	1,732
finance costs		(92)	(172)
		(92)	(172)
Profit before taxation		3,018	1,560
Tax expense		(396)	(242)
Profit for the year attributable to equity holders		2,622	1,318
Basic earnings per share	2	54.2p	27.2p
Diluted earnings per share	2	54.2p	27.2p

Statement of Comprehensive Income

for the year ended 31 October 2025

	2025 £000	2024 £000
Profit for the year	2,622	1,318
Other comprehensive income for the year, net of tax	2,622	1,318
Total comprehensive income attributable to: Equity holders	2,622	1,318

Balance Sheet

at 31 October 2025

		2025 £000		2024 £000
Non-current assets
Property, plant and equipment		17,582		17,261
Investment property		2,258		2,258
Right of use asset		74		116
		19,914		19,635
Financial assets		764		436
Deferred tax asset		-		16
		20,678		20,087
Current assets
Inventories		10		10
Trade and other receivables		1,060		1,217
Cash and cash equivalents		2,308		754
		3,378		1,981
Assets held for sale		-		504
Total assets		24,056		22,572
Current liabilities
Trade and other payables		(1,018)		(1,013)
Financial liabilities		(341)		(746)
Income tax payable		(289)		(347)
		(1,648)		(2,106)
Non-current liabilities
Other payables		(385)		(326)
Financial liabilities		(1,294)		(1,638)
Deferred tax liabilities		(979)		(875)
Defined benefit pension plan deficit		-		(92)
		(2,658)		(2,931)
Total liabilities		(4,306)		(5,037)
Net assets		19,750		17,535
Capital and reserves
Equity share capital		251		251
Capital redemption reserve		686		686
Own share reserve		(1,135)		(1,049)
Fair value adjustments reserve		10		10
Retained earnings		19,938		17,637
Total equity		19,750		17,535

Statement of Cashflows

for the year ended 31 October 2025

		2025 £000		2024 £000
Operating activities
Profit for the year		2,622		1,318
Tax expense		396		242
Net finance costs		92		172
Profit on disposal of non-current assets and assets held for sale Depreciation and impairment of property, plant and equipment		(1,056) 172		(308) 222
Decrease in trade and other receivables		157		11
Decrease/(increase) in trade and other payables Impairment of fixed assets Mortgage receipts received Insurance receipt		66 200 37 (877)		(73) - 33 -
Cash generated from operations		1,809		1,617
Income taxes paid		(350)		(135)
Interest paid		(127)		(200)
Net cash inflow from operating activities		1,332		1,282
Investing activities
Proceeds from sale of property, plant and equipment and assets held for sale		1,294		370
Payments to acquire property, plant and equipment Interest received Insurance receipt		(828) 35 877		(1,138) 28 -
Net cash (outflow)/inflow from investing activities		1,378		(740)
Financing activities
Preference dividend paid		(1)		(1)
Equity dividends paid		(320)		(277)
Consideration received by EBT on sale of shares		70		67
Consideration paid by EBT on purchase of shares Capital element of finance lease rental payments Loan repayment Other loans received		(156) (54) (695) -		(75) (29) (246) 400
Net cash outflow from financing activities		(1,156)		(161)
Increase/(decrease)/increase in cash and cash equivalents		1,554		381
Cash and cash equivalents at the beginning of the year		754		373
Cash and cash equivalents at the year end		2,308		754

Statement of changes in equity

for the year ended 31 October 2025

	Equity share capital £000	Capital redemption reserve £000	Own share reserve £000		Fair value adjustment reserve £000		Retained earnings £000	Total equity £000
At 1 November 2023	251	686	(1,041)		10		16,596	16,502
Profit for the year	-	-	-		-		1,318	1,318
Other comprehensive
income for the year net of income tax	-	-	-		-		-	-
Total comprehensive
income for the year	-	-	-		-		1,318	1,318
Consideration received
by EBT on sale of shares	-	-	67		-		-	67
Consideration paid by
EBT on purchase of shares  Equity dividends paid	- -	- -	(75) -		- -		- (277)	(75) (277)
At 31 October 2024	251	686	(1,049)		10		17,637	17,535
	Equity share capital £000	Capital redemption reserve £000	Own share reserve £000	Fair value adjustment reserve £000		Retained earnings £000		Total equity £000
At 1 November 2024	251	686	(1,049)	10		17,637		17,535
Profit for the year	-	-	-	-		2,622		2,622
Other comprehensive
income for the year net of income tax	-	-	-	-		-		-
Total comprehensive
income for the year	-	-	-	-		2,622		2,622
Consideration received
by EBT on sale of shares	-	-	70	-		-		70
Consideration paid by
EBT on purchase of shares	-	-	(156)	-		-		(156)
Equity dividends paid	-	-	-	-		(321)		(321)
At 31 October 2025	251	686	(1,135)	10		19,938		19,750

Equity share capital

The balance classified as share capital includes the total net proceeds (nominal amount only) arising or deemed to arise on the issue of the Company's equity share capital, comprising Ordinary Shares of 5p each and 'A' Limited Voting Ordinary Shares of 5p each.

Capital redemption reserve

The capital redemption reserve arises on the re-purchase and cancellation by the Company of Ordinary Shares.

Own share reserve

Own share reserve represents the cost of The Heavitree Brewery PLC shares purchased in the market and held by The Heavitree Brewery PLC Employee Benefits Trust  ('EBT').

At 31 October 2025 the Company held 107,294 Ordinary Shares and 96,626 'A' Limited Voting Ordinary Shares (2024: 98,938 Ordinary Shares and 51,156 'A' Limited Voting Ordinary Shares) of its own shares. During the year there were purchases of 89,957 and sales of 44,487 'A' Limited Voting Ordinary Shares.

Fair value adjustments reserve

The fair value adjustments reserve is used to record differences in the year on year fair value of the investment classified as fair value through other comprehensive income.

Notes to the preliminary announcement

1.  Basis of preparation

These figures do not constitute full accounts within the meaning of Section 396 of the Companies Act 2006. They have been extracted from the statutory financial statements for the year ended 31 October 2025. The statutory financial statements have not yet been delivered to the Registrar of Companies.

The auditors, PKF Francis Clark, have reported on the accounts for the years ended 31 October 2025 and 31 October 2024. Their audit reports in both years were unqualified, did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006 in respect of those accounts.

The financial information in this statement has been prepared in accordance with UK adopted international accounting standards as applied in accordance with the Companies Act 2006. The accounting policies have been consistently applied and are described in full in the statutory financial statements for the year ended 31 October 2025, which are expected to be mailed to shareholders on 05 March 2026.  The financial statements will also be available on the Company's website www.heavitreebrewery.co.uk.

Going Concern

The Directors continue to closely monitor the Company's financial resources. This included a continual review of the medium-term financial plan, along with sensitised cash flow forecasts for 12 months from the date of approval of these financial statements.

With another Government budget bringing difficulties for the industry in the coming year, the level of business rates which the pubs will have to pay with the allowance of business rates being phased out being the major concern,  another rise in minimum wage, this year's increase in costs from National Insurance (NI) and continued increases in food inflation, will undoubtedly bring about more difficulties in an already stretched sector. We will have to wait and see if any of the pressure coming from the sector will result in any changes to proposed business rates from April 2026. These factors have the potential to lead to more tenant vacancies which would have a knock on impact on the Company's rental and wet sales income.  With this in mind a sensible and prudent approach when forecasting wet sales revenue and rental revenue for the coming year is included within the forecast for the period to April 2027.  These forecasts leave the Company with minimum headroom of over £2.5m on an overdraft facility of £3m. The Board will continue to review cashflows as part of its ongoing strategy.

The Board took the decision a few years ago to accelerate the paying down of its £4.5m term loan by the selling of non-core assets to secure its current position and the long-term trading position of the Company.  There are no forecasted capital sales in the coming year as the Board has looked at the estate and the current level of borrowing. The process of disposal and assets being identified will be evaluated again over the next twelve months. This year the Company has sold two (2024:one) of the non-core assets resulting in profits of £1,056,000 being realised from these and other minor asset sales, leaving the balance of the Term Loan at 31 October 2025 of £1,524,000.

The Board has negotiated a cash settlement on the Insurance cover for the fire at the Jolly Sailor Inn, this has resulted in a cash sum into the business of £877,000, this has been invested in a deposit account, so that a decision can be made on the re-building or sale of the land with planning permission.

The Board continues to liaise with the bank on a regular basis for trading updates. The Board negotiated a new 5 year banking facility including the Term Loan and the £3m overdraft facility at the beginning of this financial year. The overdraft facility terms remain the same with no increase on interest rate over the base rate. A small reduction in interest rate on the Term Loan over bank of England base rate has been achieved with an adjustment in the debt service covenant which is now an EBITDA calculation only. The forecasts indicate that the Company will be able to operate within its new covenants and facilities.

The Directors are satisfied that the Company's forecasts and projections have included the anticipated cost increases which may impact the Estate. This has been reflected in the budgets with a decrease percentage 3.5% built in on wet revenue and 3% on rental revenue. The current trading performance of the Company also shows that it will be able to operate within the level of its facilities and covenant testing for the 12 months from the date of these financial statements. With the support from the bank there are no material uncertainties in relation to going concern. For this reason, the Company continues to adopt the going concern basis in preparing its financial statements.

2.  Earnings per share

Basic earnings per share amounts are calculated by dividing profit for the year attributable to ordinary equity holders by the weighted average number of Ordinary shares and 'A' Limited Voting Ordinary shares outstanding during the year.

The following reflects the income and shares data used in the basic and diluted earnings per share

Computation:

	2025 £000	2024 £000
Profit for the year	2,622	1,318
	2025 No. (000)	2024 No. (000)
Basic weighted average number of shares (excluding own shares)	4,838	4,840

3. Dividends paid and proposed

	2025 £000	2024 £000
Declared and paid during the year:
Equity dividends on ordinary shares:
Final dividend for 2024: 3.85p (2023: 3.5)	193	188
First dividend for 2025: 2.75p (2024: 2.75)	138	113
Less dividend on shares held within employee share schemes	(12)	(12)
Dividends paid	319	289
Proposed for approval at AGM
(not recognised as a liability as at 31 October 2025)
	193	193
Final dividend for 2025 3.85p (2024 : 3.85p)    Cumulative preference dividends	193 1	193 1

4. Segment information

 Primary reporting format - business segments

During the year the Company operated in one business segment - leased estates.

Leased estate represents properties which are leased to tenants to operate independently from the Company, under tied and free of tie tenancies.

Secondary reporting format - geographical segments

Revenue is based on the geographical location of customers. All revenue is generated in, and all assets are held in the United Kingdom.

5. General information

The 2025 Annual Report and Financial Statements will be published and posted to shareholders on 5th March 2026 Further copies may be obtained by contacting the Company Secretary at The Heavitree Brewery PLC, Trood Lane, Matford, Exeter EX2 8YP. The 2025 Annual Report and Financial Statements will also be available on the Company's website at http://www.heavitreebrewery.co.uk/financial/

The Annual General Meeting will be held at the Registered Office on 15 April 2026 at 11.30am.

Ends.

 

END