I bought into these in December last year, primarily for the yield, but also for the potential growth of one of the better companies in their sector.


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Marston's Fundamentals (MARS)

Trading Update

Trading

Trading in the second half year to date has been good overall, helped by recent good weather and the World Cup. As in previous years, our wet-led pubs, leased estate and brewing business benefited significantly from the World Cup and, despite the negative impact on food-led pubs the tournament was positive for the Group.

This improvement, after a first half-year affected by poor weather, means that we have achieved encouraging sales growth in both our pub and beer businesses in the 42 week period to date, and we expect to deliver underlying earnings in line with expectations for the full year.

Total managed and franchised pub sales were up 5.2% in the 42 week period, including like-for-like sales growth of 0.3% and the contribution from our pub expansion programme. In the most recent 16 weeks, like-for-like sales were up 0.9%, helped by good weather and the football, but with some offset from poor weather in April. Post April, overall like-for-like sales growth over the last 12 weeks has been 2.0% with the Destination and Premium performance continuing to improve as well as weather benefiting Taverns.

In Destination and Premium, like-for-like sales for the 42 week period were 1.5% behind last year, an improvement on the first half-year, with like-for-like sales down 1.2% in the last 16 weeks despite the negative impact from the World Cup. We continue to remain disciplined in terms of pricing, discounting and promotion, with operating margin only slightly below last year and in line with our expectations.

In Taverns, managed and franchised like-for-like sales for the 42 week period were 3.8% ahead of last year, including growth of 5.0% in the last 16 weeks. Most of our pubs have attractive outside areas allowing our customers to enjoy the good weather, and we created a brilliant World Cup atmosphere in many, building on the demand for experiences and the fact that pubs are the 'next best thing' to live football. Leased profits for the 42 week period are estimated to be 2% ahead of last year.

Marston's Beer Company achieved strong growth, including total volumes up around 61% in the 42 week period with good growth in the underlying business. We continue to realise benefits from the acquisition of Charles Wells Brewing and Beer Business. Our portfolio, which includes an outstanding range of premium ales, World Lagers and Craft Beers, increased market share.

We remain on track to meet our openings growth targets for 15 pub restaurants and bars, and six lodges, in the current financial year.

Commenting, Ralph Findlay, Chief Executive Officer, said:

"We are encouraged by our stronger trading performance in the second half-year, including the benefit of recent good weather and the impact of the World Cup in our Taverns estate and in Marston's Beer Company.

"We have a strong pipeline of sites which will contribute to continued growth in pubs, and see further opportunity in brewing following the acquisition and successful integration of Charles Wells Brewing and Beer business in 2017. Our strategic objectives and progressive dividend policy remain appropriate for current market conditions and we remain confident of delivering underlying earnings in line with expectations for the full year."

No one getting too excited, but looking ok.

25 Jul 18 Shore Capital Buy 97.93 - - Reiterates
25 Jul 18 Liberum Capital Buy 97.93 130.00 - Reiterates
25 Jul 18 Peel Hunt Buy 97.93 140.00 - Reiterates

Director buys 100,000. shares http://www.moneyam.com/action/news/showArticle?id=6130065

How bizarre. MARS seems to have turned up for no particular reason (other than it was stupidly low or possible GNK figures)

Strange how markets work

Suspect it was low because of retail getting a slapping in general CC.

I agree Stan but MAB hasn't picked up, JDW has gone down, GNK doesn't know what it is doing. It's just MARS that is rising.

Maybe it is something to do with the new Chairman?

Year End Trading Statement: 10 October 2018

Full year results: 21 November 2018

New chairman looks like he knows his stuff, particularly on the accommodation front which Mars have been very successful at rolling out over the years:

https://www.insidermedia.com/insider/midlands/marstons-appoints-new-chairman

I’m also into these and was looking to buy for a third time but concerned of catching “ falling knives” and now wondering if I’ve missed the boat! I like the yield sub nav rating and gentle growth prospects.

Finals 10th October according to MoneyAM.

And the link in the Header! :-)

Doing ok in a poor market, albeit from a low base. Roll on Wednesday (I hope)

YEAR END TRADING UPDATE

Trading

Strong trading during the World Cup and warm summer weather contributed to our achieving record revenue and underlying profit before tax for the financial year. Group turnover was up 15% to over £1.1bn and we anticipate reporting underlying profit before tax of around £104 million (2017: £100.1 million) with higher operating profits in each of our trading segments offset by higher interest charges.

Total pub sales increased 3.2%, including like-for-like sales growth of 0.6% and the contribution from our pub expansion programme. In the most recent 10 weeks, like-for-like sales were up 1.6%.

Taverns: our wet-led Taverns pubs performed strongly with managed and franchised like-for-like sales growth of 3.8% including growth of 3.8% in the last 10 weeks. This good performance from our community pub estate was boosted by the World Cup and warm summer weather, although trading has been consistently strong throughout the year. Like-for-like profit in our leased estate is around 2% up.

Destination and Premium: as previously reported, our food-led Destination pubs were impacted by poor weather in the first half-year, and weaker trading during the World Cup as expected. In Premium pubs and bars, Pitcher & Piano and Revere Country traded well. Like-for-like sales were 1.2% behind last year, with growth in both drink and accommodation offset by weaker food sales. In the last 10 weeks momentum has improved with like-for-like sales up 0.1% on last year. We have maintained a keen focus on cost control and continue to remain disciplined in terms of pricing, discounting and promotion, with operating margin expected to be around 0.5% below last year.

Marston's Beer Company: we achieved strong growth with total volumes up around 47% in the year benefitting from the acquisition of Charles Wells Brewing and Beer Business in 2017, good summer weather and the World Cup. We have made significant distribution gains in the last year and our portfolio, which includes an outstanding range of premium ales, World Lagers and Craft Beers, further increased market share. Marston's now distributes to one in four of the UK's 46,000 pubs nationwide. Sales of own and licensed brand volumes exceeded one million barrels for the first time this year, and we distributed around 2.5 million composite barrels of drinks to the on and off trade sectors. Around 90% of 'own brand' volume is now sold outside Marston's own pubs.


more.....

Peel Hunt Buy 98.33 140.00 125.00 Reiterates

Shore Capital Buy 98.25 - - Reiterates

Liberum Capital Buy 98.25 130.00 - Reiterates

Can anyone explain the acquisition to me.

Purchase 15 pubs at say £1m each. (I can't find out how much they cost. Aprirose website doesn't say and although they were acquired in July 2017 I guess, I cannot find an RNS from MAB). 15m + £4m refurb at 5% interest = £950k. If EBITDA is £1m then operating profit on them is basically zero.

I understand they will own the pub at the end of 40 years or whatever, but it doesn't seem a decent deal to me. One further wonders why MARS think they can make money out of them when MAB didn't and Aprirose are happy to shift them on.

Any thoughts? Is my £1m per pub way out?

The city appears to be screaming at MARS to pay down some debt but they keep doing the opposite !

I can’t comment on those numbers CC but as I understand it they are and have been for a number of years now trying to offload pubs with no accommodation and buying pubs with accommodation.

At the same time giving the running of those pubs over to people who have a high degree of autonomy. The newer model of pub/accommodation has/is and will be the best way going forward to make money, also to keep the English pub trade prospering IMO.

The accommodation side was actually the reason I bought MARS over the other brewers.

In one of my better moments when I was trawling through the accounts of all the Brewers I find the accommodation section in MARS and a light bulb went off in my head.

I shall patiently hold and see what happens. The challenge for me here is that I'm comfortable enough with the debt and it's structure, it's just that the market isn't.

All the wile interest rates are relatively low the debt is secondary at the moment I think.

Finals are 21st Nov.

I would also like to see the debt come down, trading looks ok, the quieter period before Christmas (Nov- early Dec) is yet to come but I'll stay put and nurse my losses.