Vianet revenue up 1.4% but pubs code a threat
Vianet this morning reported revenue up 1.4% to £9.14m for the six months to 30 September 2014 with profit before amortisation, share based payments and exceptional items up 16.9% to £1.52m. Group pre-tax profit was £0.77m, up from £0.57m in H1 2014.
The company said it had installed 268 new beer monitoring systems, of which 261 were higher value iDraught installations. This compared to 150 installations in H1 2014 of which 79 were iDraught. The company said vending division growth continued with 3,926 unit sales up from 650 in H1, predominantly in coffee vending.
Vianet said pub closures had led to a net reduction of just over 300 sites to approximately 16,100 sites in the core Leisure installation base. But it stressed this was “a marked slowdown in the pace of reduction from the experience of the previous financial year”.
Dickson said the results showed the “resilience of Vianet’s recurring revenue streams”.
Uncertainty
On the outlook for the company he said: "As before, Vianet’s growth and profitability is strongly influenced by factors affecting the UK pub sector. Given the Government’s announcement on the statutory sode in early June 2014, industry uncertainty has been diminishing resulting in a modest increase in the pace of new iDraught sales as pub operators evaluated their investment plans in the new environment.
"However, further uncertainty has now been introduced with the House of Commons’ recent narrow vote in favour of a Bill to introduce a market rent-only option to the statutory code.
"Whilst there are several hurdles facing the Bill, including potential legal challenges as it progresses through the parliamentary process, regardless of the outcome any change may be some way off. Though this development should have limited impact on the long term success of Vianet, the short term uncertainty is unwelcome as it may lead to some pub company investment temporarily being held back at a time when the Group was starting to witness a pickup in trading.
"Further M&A activity in the pub sector may also have a short term dampening effect on new iDraught volumes. Nonetheless, with the number of pub closures diminishing and the benefits of cost initiatives coming through, the outlook for the group’s core Leisure division is improving."
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