Stock Exchange announcements
29-Jan-2009: Interim Management Statement
Fuller, Smith & Turner P.L.C. ('Fuller's' or 'the Company') today releases the following Interim Management Statement in connection with the 43 week trading period to 24 January 2009.
The Company has enjoyed a robust trading period since our half year. As previously reported, like for like sales in the Fuller's Inns Managed Pubs business in the first 7 weeks to 15 November 2008 following the half year grew by 1.8%. In the 10 week period from 16 November 2008 to 24 January 2009 they grew 4.5%, increasing the year to date like for like sales growth to 2.7%. Like for like profits in the tenanted divison continue to be down 1% for the 43 weeks to 24 January 2009. Own Beer volumes for the Fuller's Beer Company remain marginally behind last year, at 1% lower for the 43 weeks, but with overall market share continuing to grow and margins holding up well.
The Company's cash generation and balance sheet remain strong. When we complete the purchase of 3 pubs from Mitchells & Butlers plc in early February, we will have added 5 pubs to our estate during the year, bringing the total number to 360. The Company is well placed to purchase further high quality pubs.
As previously announced on 20 January 2009, John Dunsmore, former Chief Executive of Scottish & Newcastle plc and recently appointed Chief Executive of C&C Group plc, joined the Board as a Non Executive Director, with effect from that date.
The trading environment for the remainder of the financial year is unlikely to improve. Although the outlook for cost prices is better, the Company will continue to experience very high like for like increases in energy and raw materials costs for the remainder of this financial year and into next year, due to the expiry of advantageous forward contracts. However, the overall strength of the Company's business gives the Board cause to remain confident that adjusted profit before tax for the year will be within the range of market expectations.
Michael Turner, Chairman, commented as follows:
'I am very pleased with our performance in what is now clearly a period of sharp contraction in consumer spending. Our Christmas and New Year trading demonstates that even when the UK is feeling the pinch, customers will seek out Fuller's beers and Fuller's pubs. This is clear validation of our strategy of offering high quality products in the best pubs and our conservative financial
management has put us in a position to strengthen the business during this economic downturn.
'Notwithstanding Fuller's own situation, the Chancellor's duty increase during the year of 17.8% has had a devastating effect on some of our customers. It is essential that the duty escalator which was announced last year is now withdrawn, and that there should be no further duty increases in the forthcoming budget. Fuller's beer volumes are outperforming the market but the British beer industry is not resilient enough to pay any more.
'I appeal to the Prime Minister and the Chancellor to stop adding to the misery that licensees are suffering due to the economic downturn by adding any further burdens. The costs of compliance with the seemingly endless legislation that licensees have to cope with has meant that the tipping point has now been reached. The number of pubs closing their doors for ever has risen to a very
worrying 39 each week.
'The British pub is the home of responsible drinking, and the envy of the world. The entrepreneurial characters that run their community pubs should be respected for what they add to our society, and not pilloried and legislated out of business.'
The next report will be on 5 June 2009 when the Company issues its preliminary results for the 52 weeks to 28 March 2009.
- Ends -
For further information, please contact:
Fuller, Smith & Turner P.L.C.
Press Office 020 8996 2175/2198/2048
Mobile: 07824 815 366/07748 657 854
Michael Turner: Press 020 8996 2048
James Douglas: Analysts 020 8996 2048
Merlin 020 7653 6620
Paul Downes 07900 244 888 (mobile)
Category: Interim Management Statement