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Tue 4th Aug 2015 - Update: Just Eat and Adnams First Half results
Just Eat reports sales up 54% to £107.8m in First Half: Just Eat, the digital marketplace for takeaway food, has reported ‘another period of excellent growth’ in the six months ended 30 June 2015 with revenue up 54% to £107.8 million and Underlying Ebitda up 62% to £25.8 million. Underlying Ebitda was up 62% to £25.8 million (H1 2014: £15.9 million). Active users were up 59% to 11.0 million (as at 30 June 2014: 6.9 million). Orders via mobile devices account for over 60% of total orders (H1 2014: over 50%). The platform processed orders worth over £700 million for our takeaway restaurants (H1 2014: £465 million). David Buttress, chief executive, said: “Just Eat has made a very strong start to 2015, increasing the numbers of active users, takeaway restaurants and orders. We have seen the success of our ongoing strategy to reinvest profits above target to drive additional growth. I am particularly pleased to see the results of our mobile strategy which has already created a much improved experience for our app and mobile users. We have acquired market-leading operations in three new rapidly growing markets of scale: Mexico, Australia and New Zealand. I would like to thank the entire Just Eat team, who have worked tirelessly to achieve these results.” The company added: “Our focus on driving incremental revenue by further investing in technology and marketing is expected to continue into the second half of the year, alongside additional investment into the exciting early-stage Brazilian and Mexican markets. As a result of the additional orders delivered by this extra investment, management now expects revenue for 2015 of around £230 million, with such revenue over-performance expected to continue into 2016. By the end of the current financial year, we intend to invest an additional £8 million in marketing in our core markets, together with an additional £5 million of investment into technology and our Latin American teams. Notwithstanding this significantly increased investment, we remain on track to deliver Ebitda for the current year in line with expectations.”


Adnams reports 12% increase in operating profit in First Half, plans £7m brewery investment: Suffolk-based brewer and retailer Adnams has reported a 12% increase to £962,000 in its operating profits for the six months to 30 June 2015, ‘a strong result after a long cold spring’. Turnover was down 3% at £29.1m, partly as a result of two of its large managed properties being closed for refurbishment, and own beer volumes were down by 5% after last year’s 18% increase. The current year dip in beer volumes was notably in the volatile area of sales to the large managed pub companies. Property profits were £407,000 – last year they were £107,000. Three properties were sold in the last six months.

The Adnams Brewing & Brands Business: The company stated: “The beer market continues to evolve very rapidly as new products are launched, numbers of small producers continue to increase and consumer tastes change, inspired by the range of beers now available. This has created more challenging times for classic English beers like Adnams Bitter. However, it has also created opportunities for our own new products. We believe that we have been successful in reading and reacting to industry trends. The rapid rise of Adnams Ghost Ship and the more recent success for some of our innovative products supports this view. Underlying market trends suggest that we are well placed to grow and it is with this background that we are pushing ahead with a substantial £7m investment in our brewery to achieve the capacity and flexibility that we will need. Market data suggests that in the first six months of this year beer volumes have declined, by 3.6%, and the cask ale market has grown by 0.5%. Our volumes were behind this. However, we have noted in previous reports that large managed house operators have become more important both to us and to the market as a whole. This creates some inevitable volatility in our volumes as these businesses rotate their offer. Our directly delivered business in East Anglia saw volumes on a par with 2014, though London volumes were less strong as that market is becoming increasingly competitive with the rapid growth of local brewers, a phenomenon in which London has lagged most of the rest of the country. Our sales to supermarkets and other take home outlets were in line with those achieved in the same period last year. Our greater focus on export yielded good sales growth though volumes are still small.”

The Adnams Copper House Distillery: The company stated: “Our spirits business has continued its strong growth helped by Adnams Longshore Vodka winning the International Wine & Spirits Competition’s vodka trophy in the year after our Copper House Gin won the equivalent gin award. The strong demand that we have seen for gin has meant that our distillery has reached capacity as we have worked to meet this demand and also lay down whisky stocks for the future. We are investing half a million pounds in the distillery to roughly double the capacity and increase efficiency to realise our growth ambitions. This investment will be complete by the end of the year.”

The Adnams Property Businesses: The company stated: “With the move of two of our key outlets, the White Horse Blakeney, and the Ship Levington, to managed houses and our shorter term management of some of our smaller tenancies we are treating our property business as an integrated whole where pubs and hotels may move between tenancy or leasehold or our own management as circumstances require. The Managed Inns part of this business, comprising the Swan and Crown in Southwold together with the White Horse and the Ship saw substantial investment in the first half of this year. Both the Swan and the White Horse were closed for several weeks whilst refurbishments took place. This had some inevitable impacts on trading, however we believe that we will start to see the returns from the investments coming through in the second half of the year. The leased and tenanted part of the business has seen the impact of having fewer pubs as we have sold a number of smaller outlets in recent years, however underlying trading has been good with like-for-like results ahead of last year and an overall result similar to a year ago. The three pubs sold in the first half of this year were: The Bull at Cavendish, the Fleece at Bungay and the Queen’s Head at Long Stratton. Since the half year Adnams has sold the Ship at Burnham and the Cock at Clare and has three further pubs on the market.”

The Adnams Shops: The company stated: “Our shops have continued their recent trend of improved trading with like-for-like revenue growth well ahead of the high street average. These shops are an integral part of the Adnams proposition. They have been instrumental in portraying our brand to a wider audience, particularly a female audience less familiar with Adnams. They have also helped us to launch new products and have been notably important in assisting the early growth of our spirits business. We saw no new openings or closures in this half year. However, we will open a new shop in Bury St Edmunds in the second half. Our online shop continues its growth and we are investing in our proposition to significantly improve the customer experience and further grow this increasingly important channel”.

Treasury and Pensions: The company stated: “Our bank debt at 30 June was £9.4m (30 June 2014: £11.2m), an increase from our year end debt levels of £8.0m. The main reason for the increase is the investment programme that we have pursued in the brewery and distillery and at the Swan, Southwold and White Horse, Blakeney. Our three year facility agreement with Barclays will expire in February 2016 and this autumn we will be assessing offers for a replacement facility. We have continued with our policy of paying interest at short term rates and not fixing the amount payable on the loan. This policy has continued to be beneficial whilst rates have remained low. Further details of our bank loan are in note 6 to the accounts.”

The Future: The company stated: “The underlying trends within our business have mainly been positive. Our newer beers have grown well in a fickle market and our spirits have continued their strong growth. We are making substantial investments in both our brewery and distillery to secure capacity and flexibility for the future. Our continuing pub estate has traded well and has maintained profitability despite its smaller size, and our managed properties have received investment to secure their trading. Our retail business has had a strong six months and is looking at further expansion and at continuing investment in its online presence.”

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