​Financial Highlights

Enterprise Inns plc

Preliminary announcement for the financial year ended 30 September 2015

"Further operational progress and strategic execution on track"

Enterprise Inns plc (ETI or Enterprise), the largest pub owner in the UK, today announces its results for the year ended 30 September 2015.

Financial highlights

  • Like-for-like net income growth of 1.0% in the final quarter resulting in an increase of 0.8% for the full year
  • EBITDA* before exceptional items of £296 million (2014: £302 million), in line with expectations following the impact of planned asset disposals
  • Profit before tax and exceptional items increased to £122 million (2014: £121 million)
  • Adjusted earnings per share# up 2.1% at 19.4p (2014: 19.0p)
  • Strong cash generation enables further net debt reduction, down to £2.3 billion (2014: £2.4 billion)

*Earnings before interest, tax, depreciation and amortisation
#Excluding exceptional items

Statutory results

  • Statutory loss after tax of £65 million (2014: £30 million profit) after net exceptional charges of £162 million (2014: £65 million) which primarily relates to the impact of the total estate revaluation, which is down 2.7% (2014: down 1.9%).

Operational & strategic highlights

  • The execution of our strategic plan for the business is on track. Delivery of this plan will ensure we can best serve our publicans and communities whilst providing a clear path to maximising shareholder value through the optimisation of returns from every asset within our estate.
  • Reinvigorated tied tenanted business
      • ​Operational enhancements aimed at improving publican profitability have helped deliver a further 18% reduction in the number of business failures
  • Expanded managed business
      • Total number of managed house pubs trading under our Bermondsey and Craft Union operations increased from 16, at the time of our strategy announcement on 12 May 2015, to 35 at 30 September 2015.
      • Our first managed expert pub successfully opened on 8 October 2015 in Forest Hill, London
  • Quality commercial property portfolio
      • We have increased our portfolio of commercial properties from 185 sites, at 12 May 2015, to 213 sites and have increased the average annualised rental income from £53,000 to £56,000.
  • Capital investment and disposals
      • Capital investment of £69 million (2014: £66 million) of which 44% was focused on growth driving initiatives yielding expected returns on investment in excess of our 15% hurdle rate
      • Net proceeds from disposal of primarily under-performing assets of £75 million (2014: £73 million) used to fund investment programme

Commenting on the results, Simon Townsend, Chief Executive Officer said:

We are pleased to report further operational progress and a second, successive full year of like-for-like growth in net income across our leased, tenanted and free-of-tie estate. This has been achieved by maintaining a relentless focus on the many operational activities and initiatives with which we are supporting our publicans to improve their profitability. Trading in the first six weeks of the new financial year has been in line with our expectations and continues to maintain our growth momentum.

While the market in which our pubs operate remains highly competitive, and as we prepare for the implementation of new legislation in 2016, we are encouraged by the continuing momentum of our business, reflecting the exceptional efforts of our publicans and the strength of our relationships with them.

The implementation of our strategic plan is on track, providing us with greater flexibility with which to optimise returns from each of our assets and deliver greater value to our shareholders. Our managed house estate is being successfully expanded and our commercial property portfolio continues to grow in both scale and quality in line with our plans.

We have attracted some outstanding talent to help us execute our new strategy. They bring a wealth of experience to complement the quality, loyalty and determination of the existing Enterprise team which, combined with the skills and expertise of our publicans, gives us confidence in the Group’s prospects.