Interim Results - Pre-tax Profit Up 49%
Young & Co's Brewery PLC
11 November 1999
YOUNG & CO.'S BREWERY, P.L.C.
Interim results
For the 26 weeks to 25 September 1999
Key highlights:
* Turnover increased to £45.0 million up 8.8%
* Operating profit increased to £4.9 million up 14.1%
* Adjusted profit before tax increased to £3.8 million** up 20.1%
* Profit before tax increased to £5.0 million up 49.0%
* Adjusted earnings per share of 19.35p** up 17.2%
* Basic earnings per share of 28.85p up 58.6%
* Dividend per share increased to 8.70p up 6.1%
* Net assets per share increased to £10.31 up 3.2%
* Total beer production up 22.6%, mainly due to new brewing contracts
* Young's branded beer production up 1.9%, in direct contrast with market
trends
* New Finch's bar-restaurants trading well ahead of expectations
* Continued progress in the free trade, with volume up 8.7%
* Special London Ale adjudged 1999 Bottle Conditioned Beer of the Year by
CAMRA
** Adjusted to exclude property sales
Commenting on the results, John Young, Chairman of Young's
Brewery said:
'Our continued progress reflects the actions we have taken to
improve operating performance and the better trading conditions
experienced during the summer. Our new Finch's bar-restaurants
are trading well and we are examining opportunities for further
sites. We also continue to make good progress in the free trade
and our position here has been strengthened by our acquisition of
Waggle Dance. With gearing at 18.7%, we have plenty of scope for
future expansion both in our traditional heartland and further
afield in the London commuter towns.'
For further information:
Pat Read, Chief executive
Peter Whitehead, Finance director
Young & Co.'s Brewery, P.L.C. 0181 875 7000
James Longfield/John Olsen
Hogarth Partnership 0171 357 9477
YOUNG & CO.'S BREWERY, P.L.C.
INTERIM REPORT
FOR THE 26 WEEKS TO 25 SEPTEMBER 1999
Chairman's statement
Profit is up 20.1% when adjusted to exclude £1.2M from property
disposals. Turnover is up 8.8%, operating profit up 14.1% and
basic earnings per share up 58.6% and by 17.2% when adjusted for
property sales.
I am pleased to report a 6.1% increase in the interim dividend to
8.70p per ordinary share, which will be paid on 9 December 1999
to shareholders on the register on 26 November 1999.
These results show strong growth and reflect our determination to
improve the company's operating performance and thereby deliver
shareholder value.
Brewing
Beer production is up by 22.6% with resulting benefits in reduced
unit costs. This is largely due to contract brewing but I am
pleased to say production of our own brands is also up by 1.9%,
in direct contrast with market trends. Total beer sales including
factored beer increased by 15.2%. We have been successful in
negotiating brewing and bottling contracts with national brewers.
We have more in the pipeline.
We are delighted that Special London Ale was adjudged 1999
Champion Bottle Conditioned Beer of the Year by the Campaign for
Real Ale at the Great British Beer Festival, a well deserved
award for a splendid beer.
Pubs and hotels
Managed Houses turnover is up 7.4% and profits up 5.6% helped by
good summer weather.
The first of our new Finch's bar-restaurants opened in Finsbury
Square in May and the second in Chelmsford in October. Both are
trading well ahead of expectations. Further sites are planned in
Wimbledon and Oxford and other potential sites are being
considered.
A further four managed houses have either been acquired or
contracts exchanged since September bringing the total of the
managed estate to 119. We continue to examine opportunities for
acquisition but remain committed to maintaining the quality of
our estate.
Hotel developments continue as we seek to make more profitable
use of existing space and land. The previously reported
developments continue as planned. These will add an extra 71
rooms bringing the total to 268.
In addition we have recently received planning permission for a
76-bedroom hotel, including 8,000 square feet of leisure
facilities, at the Castle, Putney and after eleven years of
trying to obtain planning permission from Richmond Council, we
have at last received consent for a hotel at the Coach and
Horses, Kew Green.
Hotel profits increased by 9.1%. With the increased expenditure
on accommodation, we shall be extracting greater and greater
value from our managed house estate.
Beer volumes in tenanted pubs were down 4.7% but wines and
spirits volumes were up 16.1%. Our tenanted estate continues to
provide good returns and we are maintaining investment in this
area in both refurbishing existing sites and seeking to acquire
new ones.
We have recently purchased a large tenanted pub in Dartford which
brings the estate up to 68. As with our managed houses the
quality of our estate is paramount and we were delighted that the
Duke of Cambridge was runner up in The Times 1999 national Pub of
the Year competition.
Free trade
Free trade continues to thrive. Total free trade volume was up
8.7% with particular successes in Take Home and National
Accounts.
We continue to invest in supporting our brands. Our latest
advertising campaign launched in September uses the famous
Young's Ram in a number of different poses with touches of both
irreverence and humour. We acquired Waggle Dance, a honey
flavoured beer, from Vaux in June. This has proved a success and
has strengthened our presence in the Take Home market.
In May we acquired a strategic investment in Smiles, the Bristol
brewery. We now own 8.2% of the share capital of Smiles and this
has given us a foothold for our beers both in Smiles' excellent
pubs and in their free trade outlets in the West of England.
New appointment
We warmly welcome Lord Sharman of Redlynch, O.B.E. as a non-
executive director. He has recently retired from KPMG
International, where he was chairman since 1997, having
previously been both chairman and UK senior partner of KPMG
Worldwide. His other appointments include the chairmanship of Le
Gavroche Ltd.
Outlook
With gearing at 18.7%, we have plenty of scope for future
expansion, and we continue to pursue opportunities to grow our
retail estate in our traditional heartland and now further afield
to include the London commuter towns.
John Young
11 November 1999
YOUNG & CO.'S BREWERY, P.L.C.
Unaudited group profit and loss account
For the 26 weeks ended 25 September 1999
26 weeks 26 weeks 52 weeks
to Sept 99 to Sept 98 to Mar 99
£000 £000 £000
------------------------------------------------------------------
Turnover 45,009 41,373 83,372
Operating costs (40,075) (37,050) (74,395)
------------------------------------------------------------------
Operating profit 4,934 4,323 8,977
Profit on sales of properties 1,230 217 713
------------------------------------------------------------------
Profit on ordinary
activities before interest 6,164 4,540 9,690
Net interest charge (1,171) (1,189) (2,272)
------------------------------------------------------------------
Profit on ordinary
activities before tax 4,993 3,351 7,418
Tax on profit on
ordinary activities (1,204) (942) (2,231)
------------------------------------------------------------------
Profit on ordinary
activities after tax 3,789 2,409 5,187
Preference dividends
on non-equity shares (53) (53) (107)
------------------------------------------------------------------
Profit attributable
to ordinary shareholders 3,736 2,356 5,080
Ordinary dividends
on equity shares (1,088) (1,062) (2,201)
------------------------------------------------------------------
Retained profit for
the financial period 2,648 1,294 2,879
==================================================================
YOUNG & CO.'S BREWERY, P.L.C.
Unaudited group balance sheet
At 25 September 1999
At Sept 99 At Sept 98 At Mar 99
£000 £000 £000
------------------------------------------------------------------
Fixed assets 170,075 168,091 168,551
------------------------------------------------------------------
Current assets and liabilities
Stocks 4,519 4,000 4,438
Debtors 6,719 6,051 5,816
Cash 5,246 351 4,035
------------------------------------------------------------------
16,484 10,402 14,289
------------------------------------------------------------------
Creditors: amounts falling
due within one year (15,852) (15,484) (14,729)
------------------------------------------------------------------
Net current
assets/(liabilities) 632 (5,082) (440)
------------------------------------------------------------------
Total assets less
current liabilities 170,707 163,009 168,111
Creditors: amounts
falling due after
more than one year (30,289) (27,615) (30,341)
Provisions for
liabilities and charges (5,521) (4,730) (5,521)
------------------------------------------------------------------
134,897 130,664 132,249
==================================================================
Capital and reserves
Called-up share
capital: equity 6,475 6,475 6,475
non-equity 1,361 1,361 1,361
Share premium account 1,434 1,457 1,450
Revaluation reserve 91,661 92,189 91,587
Profit & loss account 33,966 29,182 31,376
------------------------------------------------------------------
134,897 130,664 132,249
==================================================================
YOUNG & CO.'S BREWERY, P.L.C.
Unaudited group cash flow statement
For the 26 weeks ended 25 September 1999
26 weeks 26 weeks 52 weeks
to Sept 99 to Sept 98 to Mar 99
£000 £000 £000
------------------------------------------------------------------
Net cash inflow from
operating activities 6,647 8,801 14,591
------------------------------------------------------------------
Interest received 87 15 70
Interest paid (1,059) (1,282) (2,405)
Non-equity dividends paid (53) (53) (107)
------------------------------------------------------------------
Returns on investments
and servicing of finance (1,025) (1,320) (2,442)
------------------------------------------------------------------
Corporation tax paid (1) (29) (1,734)
------------------------------------------------------------------
Purchases of tangible
fixed assets (4,723) (7,232) (10,112)
Sales of tangible fixed assets 1,500 881 2,707
------------------------------------------------------------------
Capital expenditure (3,223) (6,351) (7,405)
------------------------------------------------------------------
Equity dividends paid (1,139) (1,075) (2,137)
------------------------------------------------------------------
Cash inflow before the
use of liquid resources
and financing 1,259 26 873
(Decrease)/increase in
loan capital (38) (500) 2,347
(Decrease) in lease finance (10) (10) (20)
------------------------------------------------------------------
Increase/(decrease) in
cash in period 1,211 (484) 3,200
==================================================================
Reconciliation of net cash
flow to movement in net debt
Increase/(decrease) in cash
in period 1,211 (484) 3,200
Decrease/(increase) in
debt in period 48 510 (2,327)
------------------------------------------------------------------
Decrease in net debt in period 1,259 26 873
Opening net debt (26,437) (27,310) (27,310)
------------------------------------------------------------------
Closing net debt (25,178) (27,284) (26,437)
==================================================================
Notes
(1) Recognised gains and losses
The results above are all in respect of the continuing operations of the
group. There are no profits or losses other than those disclosed above.
(2) Taxation
Corporation tax has been provided at a rate of 30% (1998, 31%; for the 52
weeks to 27 March 1999, 31%) on the profits for the 26 weeks to 25 September
1999.
(3) Earnings and ordinary dividends per share
26 weeks 26 weeks to 52 weeks to
to Sept 99 Sept 98 Mar 99
Pence Pence Pence
Earnings
---------------------------------------------------------------------
Basic earnings per 50p
ordinary share 28.85 18.19 39.23
Effect of profit on sales
of properties (9.50) (1.68) (4.21)
---------------------------------------------------------------------
Adjusted earnings per 50p
ordinary share 19.35 16.51 35.02
=====================================================================
Ordinary dividends
---------------------------------------------------------------------
Interim 8.70 8.20 8.20
Final - - 8.80
---------------------------------------------------------------------
8.70 8.20 17.00
=====================================================================
There are 12,949,636 ordinary shares in issue (1998 12,949,636).
The trustees of the Ram Brewery Trust have waived their rights to
dividends on shares held within the Ram Brewery Trust General Fund
on behalf of the directors' share option schemes.
(4) Accounts
The above financial information does not amount to full accounts
within the meaning of S.240 of the Companies Act 1985. Full
accounts for the year ended 27 March 1999, including an
unqualified auditors' report, have been delivered to the
Registrar of Companies.
YOUNG & CO.'S BREWERY, P.L.C.
The Ram Brewery, Wandsworth, London SW18 4JD
For further information, contact John Young (Chairman), Patrick
Read (Chief executive) or Peter Whitehead (Finance director).
Telephone: 0181-875 7000
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