Up to 6,455,447 new ‘A’ ordinary shares and a maximum of 4,367,472 ‘B’ ordinary shares are expected to be placed on 21 April subject to shareholder approval.
In a financial update issued on 31 March, the operator of close to 400 pubs announced that it hopes the placing will strengthen its balance sheet and ensure it has the flexibility to take full advantage of the reopening of the UK economy.
What’s more, it’s forecast that the placing will enable Fuller’s to return to pre-pandemic debt and pro forma leverage levels by early 2022.
The reveal comes after Fuller’s revealed that its pubs will have been open on only 27% of the 388 days between Friday 20 March 2020 and Monday 12 April 2021 and that revenues across its managed pubs and hotels are forecast to be 80% less than the 12 months ended 28 March 2020.
Monthly cash burn has also averaged between £4m and £5m during periods of full lockdown.
As previously reported by The Morning Advertiser, Fuller’s revealed a swing of around £40m from profit to loss in its financial results for the 26 weeks to 26 September after its pubs spent more than half of the period in lockdown.
While Fuller’s net debt currently stands at £216m – having been £152m in February 2020 – the operator also announced that it has agreed an extension to its debt maturities from lenders banks, conditional on completion of the placing.
Regaining growth momentum
Fuller’s outlined that it plans to take a phased approach to reopening, with 82 sites resuming trade initially followed by the remainder of its managed pubs and hotels opening for business by Monday 17 May.
Approximately 70% of Fuller’s tenanted inns are expected to open on Monday 12 April.
As such, assuming the Government’s roadmap is successful, Fuller’s expects to return to normalised trading conditions and become cashflow positive from mid-May.
“The past year has been hugely demanding both for our business and the wider hospitality sector but we have risen to the challenges presented by the pandemic to emerge stronger, which is the Fuller’s way,” Simon Emeny, chief executive of Fuller, Smith & Turner said.
“We have used the time wisely, rightsizing our teams, building our digital capabilities by continuing to innovate, as well as investing in our properties, and we are confident that we are in the best possible position to reopen.
“It was clear the demand for our premium pubs and hotels was as strong as ever when we were allowed to trade last year, which gives us confidence for the weeks and months ahead. Over half of the UK adult population has now had its first vaccine and we have a great team of people in place who are match-fit and ready to welcome our customers back into our wonderful pubs and hotels.
“The additional financial flexibility we are seeking to put in place will enable us to further capitalise on the opportunities open to us as we execute our recovery plan and regain growth momentum.”