Spirit reports strong final quarter results: Spirit Pub Company has reported like-for-like sales growth of 4.1% in its managed pubs in the fourth quarter to 17 August – food sales were up 4.7% and drinks sales were up 2.8%. The company described it as a “strong final quarter for our managed pubs” in which it “continues to outperform the market”. The company stated: “Our managed pubs ended the year well in the fine summer weather. Our brands continue to deliver strong like-for-like food sales growth and we are pleased with our drink like-for-like sales given the tough year-on-year comparatives against Euro 2012. Focus on the execution of our well established strategy continues to produce encouraging results. We are pleased with the progress in the transformation of our leased estate with performance in line with our expectations. Like-for-like turnover ended the full year marginally down but we saw improving momentum through the year, with the final quarter seeing like-for-like net turnover in growth and like-for-like net income broadly flat. The quality of the leased estate was further enhanced in the final quarter as we completed another 45 investment schemes and disposed of an additional 14 pubs which had been identified as having limited future potential.” The leased division saw like-for-like net turnover up 2.1% in the 12 weeks to 17 August and like-for-like net income down 0.4%. Spirit said full year earnings will be in line with market expectations. Chief executive Mike Tye said: “We have delivered a strong finish to the financial year in both estates with our performance reflecting a combination of improved weather over the summer and further execution of our strategy. We expect full year earnings to be in line with market expectations and remain well positioned for further growth. We continue to innovate to create compelling brands and pubs as well as investing in the talent and leadership of our people to deliver hospitality excellence for our guests.”
Enterprise launches £100m bond offer: Enterprise Inns has launched a £100m bond offer. The bonds will provide Enterprise with low cost, unsecured long-term funding which will reduce the company’s overall cost of borrowing, providing it with ‘increased flexibility and enhance prospects for growth’. The offer will allow Enterprise to reduce the current level of pub disposals, focusing on the disposal of under-performing assets and maximising returns for shareholders by the reinvestment of disposal proceeds into trade generating capital expenditure schemes designed to drive like-for-like growth across the business. As a result, Enterprise will not need to draw down the £70 million Tranche A of the Forward Start Facility commencing December 2013, which carries an interest cost of 5.0% – 6.5% over LIBOR, thereby reducing the overall bank facility to £150 million, amortising to £75 million on its maturity in June 2016. Enterprise chief executive Ted Tuppen said: “During the past four years, we have reduced the overall level of debt by over £1 billion, partly funded by cash generated from operations and the balance through disposals. As the quality of our pubs has improved, we have also moved towards delivering like-for-like income growth across the whole estate. The Offering will bring to an end the use of disposal proceeds for debt reduction and allow us to drive real growth in the business.”
