13th May 2014 08:20
LONDON (Alliance News) - UK pubs operator Enterprise Inns PLC Tuesday reported a higher pretax profit for the first half of the year, supported by lower exceptional property charges, and improvements in like-for-like net income, having returned to growth last year.
For the six months ended March 31, the group reported a pretax profit of GBP47 million, up from GBP29 million the prior year, helped by lower exceptional property charges, and like-for-like net income across the whole estate growing 1.1%, having declined the prior year by 4.2%. It said its southern estate performed particularly well in the first-half, helped by strong trading in and around London.
"The second half of the year will face more challenging comparatives but we continue to target like-for-like net income growth, helped in part by Easter falling in April and the FIFA World Cup finals in June," the company said in a statement.
The group's profit before tax and exceptional items in the first half was flat at GBP55 million.
Revenues for the period decreased to GBP308 million from GBP312 million a year earlier, as a result of selling off pubs.
"While market conditions remain challenging, we are pleased to have delivered like-for-like net income growth in the first six weeks of the second half of the financial year, maintaining the positive momentum delivered in the first half," the company said in a statement.
The company has been busy restructuring the business over the last few years, selling off unsustainable pubs or pubs with limited trading potential to help bring down its debt burden and reinvesting the disposal proceeds in the rest of the business.
Enterprise Inns said it gained GBP42 million in net proceeds from selling 129 pubs in the first half of the year, part of over 200 pubs expected to be sold this year. The company had said in February it is targeting GBP70 million of proceeds from its pub disposal programme this year.
It said it spent GBP41 million in capital expenditure in the first half of the year, funded from the pub disposal proceeds, some of which it used to focus on initiatives to drive sales and reduce costs for Publicans.
"I am confident that through our activities to support publicans to grow their businesses we will achieve our target of like-for-like net income growth for the full financial year," said Chief Executive Simon Townsend in a statement.
Enterprise Inns shares were up 3.4% at 149.90 pence Tuesday morning.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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