Fuller Smith & Turner desperate for 19 July reopening


Fuller Smith & Turner PLC (LON:FSTA) is seeing a boom in staycation bookings and can’t wait for all Coronavirus (COVID-19) lockdown restrictions to end on 19 July.

Simon Emeny, the pub and hotel chain’s chief executive, said: “Pubs are social spaces that thrive on spontaneity – a quick pint, staying for a bit longer to chat to someone at the bar or just walking past a beautiful pub garden and deciding to stop for a bite to eat without pre-booking a table.”

Emeny added that its Cotswold Inns & Hotels arm and rural pubs with rooms also had an “incredibly busy season to come with numerous weddings and a high level of advance bookings”.

In a statement alongside results for the year to end March 2021, he added that like for like sales for the 12 weeks to 3 July 2021 were running at 76% of 2019 levels with all sites now open.

Even so, Fullers said “Trading with social distancing is like trading with one arm behind your back,” with the results for the year just ended reflecting the difficulties.

The estate was closed for an average of 71% of the period due to the restrictions.

Revenues dropped to GBP73.4mln from GBP319.7mln with a swing to a loss of GBP59.2mln from a profit of GBP166.2mln a year earlier.

There was some good news, the one new pub to open last year was The White Horse at Wembley, in the shadow of the iconic Wembley football stadium arch and perfectly poised to benefit from the delayed European Championships, it said.

Fullers raised GBP52mln from shareholders in April to shore up its balance sheet and there is no dividend this time, but the intention is to return to progressive payouts ‘once the business is again trading profitably on a sustained basis’.

Cash generation is strong and ‘our net debt levels are below where they were pre-pandemic’, said the statement.

Peel Hunt sees scope for upgrades

Peel Hunt upgraded its recommendation to add from hold on the number with a target price of 900p.

The broker added that 2021 was heavily loss-making due to the pub estate trading for just 29% of the financial year.

Thus, the company focused on putting itself in the “best possible position operationally” to emerge from the pandemic.

Key elements of this included managing costs and net debt (with a cash burn of GBP4-5mlm per month under full closure), aided by streamlining the central support and operational teams.

Digital solutions such as Order & Pay were introduced along with enhanced central booking while ten outlets were refurbished.

Net debt was GBP218m at the end of March, which was in line with forecasts though has since fallen to GBP151mln due to the GBP52m equity fundraise.

“We are holding our forecasts at this stage, but believe 2022E forecasts could be upgraded later in the year,” the broker concluded.

Shares rose 6.5% to 884p

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