Punch Taverns: trends improving
Punch boss Ian Dyson has reported "improving trends" in both its managed and leased pub estates for the 16 weeks to 11 December despite an 8.7% decline in like-for-like EBITDA in its leased estate.
Dyson said he will report on his strategic review of the company early next year as he revealed like-for-like EBITDA dropped 7.3% in the core lease estate with a 21.8% dip in the non-core leased estate.
"The average EBITDA per pub declined by 1.7%, reflecting disposals within the non-core estate," said Dyson. "Our Pathway to Partnership programme has started to deliver benefits with the rate of like for like EBITDA decline improving in the period, despite the impact of poor weather over the last 2 reported weeks.
"Financial support for our partners has stabilised at just under £2 million per month, having been at this level for more than 12 months."
Like-for-like sales grew 2.2% in the managed estate with drink sales growth of 1.7% and food sales growth of 2.6% despite a 1% drop in sales due to the cold weather of the last two weeks of the period.
"Our pub investment programme continues apace with 92 refurbishments completed in the period, delivering returns in line with our expectations," said Dyson. "We have focused our activities on accelerating the refurbishment of our Chef & Brewer and Fayre & Square formats where guest feedback has been particularly strong."
The pubco disposed of £40m worth of non-core pubs in the period at an average multiple of 25 times EBITDA.
Dyson added: "The actions taken to strengthen both the Leased and Managed businesses have resulted in an improved trading performance in the first 16 weeks of the financial year. We are now looking to build on this momentum by focusing on further operational improvement across the business.
"Meanwhile, my review of our strategy, operating performance and capital structure is progressing and I expect to give an update in the first quarter of 2011."
Dyson could face a rough ride at Punch's AGM today after it was revealed he could earn up to £4.6m in his first year. There is also on-going specualtion that Punch is considering a radical restructuring plan, which would see it hand back 5,000 tenanted pubs to bondholders.
