Tue 19th Jan 2016 - Everards reports pre-tax profit almost doubled to £3.2m Everards reports pre-tax profit almost doubled to £3.2m: Leicestershire-based brewer and retailer Everards, led by Stephen Gould, has reported growth in pre-exceptional Ebitda of £1.2m, or 25%, to £6.1m in the year ending 30 September 2015. Operating profit increased by £1.2m to £4.3m, with results reflecting ‘strong trading performance in all parts of the business and effective management of costs’. With further savings in pensions charges and interest, profit before taxation and exceptional items in the financial period increased by £1.5m to £3.2m. The company stated: “As a result of strong trading in the pub estate, sales of beer to licensees increased by 5.1% in the year. New beer supply agreements resulted in some cost savings whilst at the same time providing the company with the ability to confirm to its licensees that all draught beer and cider prices will only increase by no more than RPI in 2016 & 2017, outside of any changes in duty. This offers certainty for licensees and helps the company to work with them in investing in their individual businesses. Alongside the benefits of strong trading and procurement savings, like-for-like net income from the pub estate has grown in every quarter of the financial year, with the year-end position showing growth of 3.2%, with the estate having grown 3% in the prior year. Throughout the year the company has experienced an average vacancy rate of just four pubs (from an estate of 176 pubs) with no closure periods in any trading outlets. The brewery at Castle Acres has had a productive year with a total of 45,000 barrels of beer brewed on site, up 3.7% on the prior year. Of this total, 47% relates to products brewed on behalf of third parties, an activity which helps support the absorption of overhead costs whilst the company remains on the current site. Sales to the pub estate of Tiger Best Bitter, Everards primary beer brand, have risen by 2% in the year. Pub development strategy has largely evolved throughout the financial year and whilst the company acquired just one pub, a total of 17 major projects were undertaken, with an average spend of £81,000 on each project. Investment in the pub estate is undertaken in collaboration with licensees looking to provide communities with personality led independent pubs, which are less about Everards branding and more about the retail offering that fits best with the licensee and their customers. The company targets average returns of 12% on all investments and has in the year achieved an ROI of 13.5% on all schemes completed within the last three years. Of the 30 projects which have been undertaken over the last three years, approximately 65% is spent on income enhancing elements, with the balance spent on defending and protecting existing levels of income for all parties. The company’s longer term plans for business relocation continue to progress well. Blaby District Council are now considering two detailed planning applications, one for the development of Everards Meadows which will include a new Everards office, brewery, innovation centre and tasting rooms; plus a cafe bar, a restaurant and cycle centre. The other application for the existing brewery site at Castle Acres has been submitted alongside Next and the Crown Estate and details retail development as an extension of Fosse Park. It is anticipated that both applications will be determined by Blaby District Council shortly. Operational performance in Quarter One of the new financial year is in line with the company’s expectations as investment continues in the pubs, beer brands and unlicensed property estate.”