This comes as the business revealed its preliminary results for the year to 30 March 2020 where it reported closure of its pubs for the final 10 days of the financial year cost an estimated £13m shortfall in revenue, with a disproportionate impact on profits estimated to be £7.7m due to the limited opportunity for mitigating actions.
Total group revenue was up on 2019 by 2.6% to £311.6m and managed house revenue was also up by 3% to £299.1m, which Young’s said was supported by a significant contribution from Redcomb Pubs following the acquisition in January 2019, but like-for-like sales were down 2.4%.
Its managed arm saw adjusted operating profits down 5% to £58.4m and Ram Pub Company adjusted operating profit was also down but by £900,000 to £4.1m.
The group’s total investment of £70.8m included upgrades to its existing estate alongside the acquisition of five pubs in south-west London and Surrey suburbs.
Operating cash flow was down to £64.7m and net debt to adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) is at 2.8 times despite a downturn in trade due to coronavirus and timing of acquisitions late in the financial year.
The business also reported it had refinanced the £50m term loan that was due to expire in March 2021, with a new five-year facility taking it to 2025. This has the two one-year expansion options that could take it out to 2027.
Young’s issued £30m in commercial paper under the Covid Corporate Financing Facility and now has the additional benefit of a new £20m facility from NatWest. Excluding its overdraft, the company now has in place £285m of funds and committed facilities.
Total drinks sales at the pub group were up on the previous year by 2% but down on a like-for-like basis by 2.6% and total food sales were up 5.1% but down by 1.7% on like for likes.
Accommodation sales were up by 5.3% this year but growth was unable to offset the lost sales from the lockdown as like-for-like rooms sales were down by 3.1%.
Total occupancy rates were 70.5% – down by 2.4 percentage points on the previous year.
Chief executive Patrick Dardis said: “I am proud of the performance of our business this year, despite the unique challenges we have faced.”
He added: “These results demonstrate the continued strength of our strategy of operating a differentiated, premium and well-invested pub estate.
“The purchase of five pubs in and around our south-west London heartland and the Surrey suburbs was a real stand-out acquisition for us. Their premium offer is a perfect fit for Young’s.
“We are grateful for the positive moves made by the Chancellor, extending the furlough scheme to October and the £14.5m relief we will received from the business rates holiday to ensure businesses like ours survive these particularly tough times.
“We are confident with the steps we have taken to safeguard our business from the immediate threat of coronavirus.
“The board expects the business to be in a position to return to profitable growth when this unprecedented period is at an end and conditions allow, and we remain confident in our proven strategy.”
Also in the results, Dardis paid tribute to NHS staff and all the critical workers “doing their very best to keep us safe and well”.
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