The pubco reported underlying financial performance in the 28 weeks to 1 March “in line with management expectations” with average profit per pub was up 4% across the entire estate.
EBITDA (earnings before interest, taxes, depreciation, and amortization) was £108m – down from £117m for the same period in 2013. Pre-tax profit was £50m, which includes £30m of profits attributable to bond purchases, (2013: £26m; no profits attributable to bond purchases). The firm said it was “on track to meet our full year profit expectations” and has £305m of cash reserves.
Punch also reported its investment programme was on track with 170 core pub investments completed at an average spend of c£90,000; 36% of its 2,961-strong core pub estate are now invested (over £40,000); up from 23% in 2012.
The company said 90% of licensees are registered on the Punch Buying Club and new licensee enquiries from potential tenants were up 40% on 2013.
In the non-core estate, 116 pubs were transferred, leaving 995 in the division. There was 0.4% like-for-like net income growth in the non-core ‘protect’ and ‘sell-later’ pubs in the non-core estate.
On debt restructuring, Punch said: “Extensive engagement with a wide group of stakeholders is continuing and the board remains of the view that a consensual restructuring is in the best interests of all stakeholders.
“Punch A and Punch B launched covenant waiver requests on 7 April 2014 in order to obtain temporary waivers of their DSCR covenants and certain other provisions of the securitisation documents to provide further time to reach agreement on a consensual restructuring. The covenant waiver requests require the support of all classes of noteholders and other securitisation creditors, with noteholder meetings convened for 29 April 2014.”
Stephen Billingham, executive chairman of Punch Taverns, said: “We have delivered profits for the half year in line with our expectations.
“Our results reflect the significant operational changes we have made over the last 15 months which are now embedded in the business.
We have returned the core estate to growth and delivered a 4% improvement in average profit per pub across our 4,000 pub estate.
“We are on track to deliver our full year profit expectations and start the second half of the year backed by the increased level of Partner operational support that will further strengthen the performance of our pubs.
“Proactive engagement on the restructuring discussions is continuing and we urge all stakeholders to support the covenant waiver requests to provide the business with stability and time to effect a consensual restructuring of the Group’s financing arrangements.”