British brewer Marston's has posted a 1% increase in beer volumes in its full year to 27 September, with the business saying that it improved operating cash flow at the business over the period.
Marston's, which owns the Bombardier and McEwan's brands among others, completed the integration of the former Charles Wells brewery in Bedford during the period, and also signed a new 15-year licence agreement with Shipyard, a beer it brews under licence.
The business, which also operates pubs and hotels, posted underlying revenue of £1.17 billion in full-year 2019, up from £1.14 billion a year earlier.
Like-for-like sales were up 0.8%, with 'growth in both wet-led and food pub segments', the company said.
'Ahead Of Schedule'
The group said that it is 'ahead of schedule' in terms of its £200 million debt reduction strategy targeted for 2020-2023, with some £70 million worth of assets set to be disposed of in 2020.
“Our principal focus remains to reduce our net debt by £200 million by 2023 - or earlier - and the measures we are taking now will result in a high quality business which is cash generative after dividends and capital expenditure," commented Ralph Findlay, chief executive.
"Trading is on track for the initial weeks of the current year and we are well prepared for the all-important Christmas and New Year period.”
Analyst Viewpoint
Commenting on its performance, Mark Irvine-Fortescue, analyst with Stifel, said, "The dividend has been held flat as Marston's delivers FY19 results in line with lowered guidance. Our underlying forecast assumptions are little changed but consensus will need to come down ~2% to reflect recent disposals. Marston's is effectively running the business for cash, making for a steady if unexciting investment case based around the dividend (6% yield).
"Capital allocation looks finely poised with modest ND/EBITDA reduction from disposals leaving limited capex scope to recover current trading underperformance vs. peers."
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine
