Ei Group sales up ahead of takeover
The company reported like-for-like sales were up in its managed pubs by 5% for the year to 30 September 2019 compared to the same period in 2018.
This was a smaller rise than in 2018, which saw a 7.1% growth owing to the English men's football team doing unexpectedly well in the World Cup that summer.
Earnings before interest, tax, depreciation and amortisation (EBITDA) fell slightly to £276m, compared to £287m the previous year.
This followed the group’s sale of £340.6m worth of commercial property assets, where some 350 sites were sold to a US hedge fund earlier this year.
It saw a 4.2% rise in underlying revenue to £724m across its estate of around 4,000 pubs, which includes the Craft Union Pub Company and Bermondsey Pub Company.
Stonegate – the pub behemoth behind the Slug & Lettuce and Walkabout brands – agreed to buy the group for £1.27bn earlier this year (July), with the deal expected to go through next year.
Ei Group chief executive Simon Townsend described the acquisition as a recognition of the quality of the group’s portfolio.
Business as usual
He said: “We are pleased to have maintained the strong trading performance for the year, particularly given the challenging trading comparatives from the summer last year.
“We continue to deliver sustained like-for-like net income growth within our core Publican Partnerships business and are generating strong returns as we expand our Managed Operations and Managed Investments businesses.
“Stonegate has indicated its intention to continue our strategy of improving the quality of the estate following completion of the acquisition, by ensuring the right consumer proposition is available in each of its pubs supported by the best people, utilising the optimum operating model.”
The Competition and Markets Authority (CMA) is in the first phase of an investigation into the takeover as per EU regulations on mergers.
Townsend said Ei bosses were focused on leading the organisation through to the expected completion of the acquisition.
He added: “Our objectives are unchanged. It is business as usual.
“We continue to identify operational improvements to drive growth in like-for-like performance and to seek the optimum use for each of our properties.”
