REG-Fuller, Smith & Turner PLC Fuller, Smith & Turner PLC: Half-Year Results
26/11/2020 07:05
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Fuller, Smith & Turner PLC (FSTA)
Fuller, Smith & Turner PLC: Half-Year Results
26-Nov-2020 / 07:00 GMT/BST
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU)
No 596/2014 (MAR), transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
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STRICTLY EMBARGOED
UNTIL 7AM THURSDAY 26 NOVEMBER 2020
FULLER, SMITH & TURNER P.L.C.
("Fuller's", the "Company", or the "Group")
Financial results for the 26 weeks to 26 September 2020
Financial and Operational Indicators
• Mandated closure of the estate for 14 weeks of the 26 week trading period. Phased reopening from 4
July 2020 but 66% trading weeks lost in Managed business due to ongoing restrictions on consumer
behaviour
• During the final two months, with the majority of the estate open, the Group made an operating profit
of £2.0 million despite severe restrictions in place
• Managed like for like sales outside of London were 92% of prior year. Overall like for like sales were
75% including transport hubs and Central London pubs
• Tight management of cash burn and recovery of working capital contributed to net debt only increasing
by £9 million to £187 million
• Accessed £100 million of commercial paper through the Covid Corporate Financing Facility
• Financing and liquidity position underpinned by strength of freehold portfolio
• Interim dividend suspended due to current economic situation.
H1 2021 H1 2020 FY 2020
£m £m £m
Revenue and other income 45.6 167.1 319.7
Adjusted (loss)/profit before tax1 (22.2) 17.9 19.4
Net debt excluding lease liabilities2 187.4 23.0 178.9
All figures above are from continuing operations
1. Adjusted (loss)/profit before tax is the (loss)/profit before tax excluding separately disclosed
items.
2 Net debt comprises cash and short-term deposits, bank overdraft, bank loans, CCFF, debenture stock and
preference shares.
Strategy Update
• Successful trading from staycations in our hotels and pubs with rooms - particularly in popular
tourist destinations - with occupancy levels of 79%, demonstrating the benefits of our balanced estate
• Utilised closure period to continue capex programme - ensuring our pubs and hotels are always in prime
condition
• Completed the integration of Cotswold Inns & Hotels, which has delivered immediate benefits
• Concluded the Transitional Services Agreement with Asahi
• Opened The White Horse, Wembley - giving us a foothold in an iconic area that is currently being
redeveloped, and where we were underrepresented
• Accelerated planned implementation of new digital initiatives driven by early identification of
changes in consumer behaviour
• Streamlined central support and Managed Pubs and Hotels teams across the business
• Long term strategy remains focused on providing outstanding food, drink and hospitality in
well-invested, iconic locations.
Current Trading & Outlook
• All pubs temporarily closed due to second national lockdown from 5 November 2020 - with swift
management action taken to achieve minimal stock losses
• 98% of team members on furlough or flexi-furlough
• Like for likes sales in our Managed Pubs and Hotels for the 34 weeks to 21 November 2020 at 69% of
prior year
• Strong engagement with, and retention of, Tenants with commercial rent for our Tenanted Inns again
suspended while pubs are under enforced temporary closure
• Well-motivated and prepared teams throughout the business primed to deliver exceptional customer
service on reopening in COVID-secure pubs and hotels
• Structured reopening planned from 2 December 2020
• High consumer confidence in our premium pubs and hotels expected to lead to strong demand as we reopen
the estate in a safe and steady manner.
Commenting on the results, Chief Executive Simon Emeny said: "The imminent roll out of a vaccine is
excellent news for the future. The tightening of the tier system will present further challenges over the
winter months, but we welcome the Prime Minister's comments that we will see the need for restrictions
fall away in the spring. Without doubt, a return to normality is in sight.
"When the current lockdown was announced, we acted swiftly to implement the lessons learned last time
round and this latest closure has been made with minimal stock losses. We also immediately placed 98% of
our team members - across our pubs, hotels and in our support functions - on furlough or flexi-furlough,
thereby minimising our cash burn. The extension of the Coronavirus Job Retention Scheme until March 2021
provides a degree of breathing space and will allow us to apply a sensible and measured approach to costs
as we reopen our estate, particularly at the most affected sites in our city centres.
"We entered this crisis in a position of strength, buoyed by the sale of the Fuller's Beer Business. We
have used the time and space created by the pandemic wisely - completing targeted investments in our
estate, rightsizing our teams and utilising the support available to manage our cash reserves where
possible. It has not been easy, but prudent financial management, an estate that is 92% freehold, and a
strong Balance Sheet mean that we will be in the best possible position to get back on a growth
trajectory.
"We know our customers want to come back, we know they trust us to look after them and provide a safe and
sensible environment to enjoy a great Fuller's experience and, over and above this, we have a dedicated
and passionate team of people with the ability and desire to delight, surprise and welcome back those
customers.
"We are optimistic about the future in the medium term and beyond, but there is no doubt that this will be
a tough winter and a very different looking Christmas. We will start to reopen our estate in a measured
way, navigating the tier system and the restrictions that come with it. However, it is important that we
see beyond these obstacles and look at the bigger picture. The excellent news of successful vaccines gives
us confidence where previously there was uncertainty, and with the sensible decisions we have taken during
the pandemic, Fuller's is well-placed for future success.
"This business is armed with a well-invested and well-balanced, freehold estate, excellent people, robust
financial foundations, a clear and consistent strategy, and the drive and desire to lead the way out of
this crisis. The long-term future for Fuller's looks positive."
-Ends-
For further information, please contact:
Fuller, Smith & Turner P.L.C.
Simon Emeny, Chief Executive 020 8996 2000
Adam Councell, Finance Director 020 8996 2000
Georgina Wald, Corporate Comms Manager 020 8996 2198
Instinctif Partners
Justine Warren 020 7457 2010
Notes to Editors:
Fuller, Smith & Turner PLC is the premium pubs and hotels business that is famous for beautiful and
inviting pubs with delicious fresh food, a vibrant and interesting range of drinks, and engaging service
from passionate people. Fuller's has 212 managed pubs, with 1,028 boutique bedrooms, and 176 Tenanted
Inns. The estate is predominately located in the South of England (44% of sites are within the M25) and
stretches from our City of London heartland to the Jurassic Coast via the New Forest. Our Managed Pubs and
Hotels include 15 iconic Ale & Pie pubs, seven stunning hotels in the Cotswolds, and Bel & The Dragon -
six exquisite country inns located in the Home Counties. In summary, Fuller's is the home of great pubs,
outstanding hospitality and passionate people, where everyone is welcome and leaves that little bit
happier than they arrived.
Photography is available from the Fuller's Press Office on 020 8996 2198 or by email at
1 pr@fullers.co.uk.
This statement will be available on the Company's website, 2 www.fullers.co.uk. An accompanying
presentation will also be available from 11.00 on 26 November 2020.
FULLER, SMITH & TURNER P.L.C.
FINANCIAL RESULTS FOR THE 26 WEEKS ENDED 26 SEPTEMBER 2020
CHAIRMAN'S STATEMENT
It has been an incredibly challenging six months for the country, for the hospitality industry and for
Fuller's. The impact of coronavirus has touched every part of the physical and economic landscape and once
again we find ourselves in a state of national lockdown.
The rollercoaster of emotions from closure, to reopening, through the well-designed and inspired Eat Out
to Help Out scheme and then back down into a quagmire of increasingly onerous restrictions, tier alert
levels and finally back to temporary closure, has been tough on our business and even tougher on our
people.
The Government has been supportive and destructive in almost equal measure - but we are grateful for the
recent extension of the furlough scheme. We urge the Chancellor to follow this with extensions to the
business rates holiday and the VAT reduction. We know that our sector can lead the economic recovery -
however we will need this longer-term support to rebuild our businesses and return to growth.
In the short term, we need clarity of message and a clear roadmap out of the coronavirus crisis. We know
we can play a major role and we relish the challenge of doing so. Should the Chancellor need any further
encouragement, the net tax deficit from Fuller's alone for the first six months of the year is over £70
million. The country needs pubs, restaurants and hotels fully open - and soon - for the financial
contribution they make, the jobs they create, and the significant role they play in the emotional
wellbeing of our customers and our teams.
Unfortunately, we again find ourselves in a position where we have had to take the decision not to propose
a dividend in light of the current economic situation. I would like to thank our shareholders for their
patience and understanding in these difficult times and it's fair to say that the sale of the Fuller's
Beer Business in April 2019, and the subsequent return of capital - which exceeded the total of the
previous seven years' dividends - has proved to be excellent timing.
I have one Board change to announce - the appointment of Rachel Spencer, who joins us on 7 December 2020
to take over the role of Company Secretary from 1 January 2021. Rachel is an experienced Company Secretary
having held positions at a number of other listed companies including Invensys, Aldermore Group and, most
recently, Clarkson PLC - the world's leading provider of integrated shipping services. Rachel takes over
from Séverine Béquin who has held the role for the past six years. Séverine leaves us to move to Madrid
with her husband and, on behalf of the Board, I would like to thank her for all her hard work -
particularly through the immense complications caused by the sale of the Fuller's Beer Business. She has
made a very valuable contribution to Fuller's and we wish her every happiness in the Spanish sun.
Finally, I would like to pay tribute to the amazing team of people at Fuller's. Simon and his Executive
Board have risen to the challenge and navigated a course through the most turbulent of times. But it is
the teams in our pubs who are the real heroes. Armed with masks, social distancing and sanitiser by the
lorryload, they have delivered an amazing Fuller's experience in extremely unusual conditions and I am in
awe of the upbeat and positive manner that they maintain.
We should have been commemorating 175 years of this wonderful company during November with a major
consumer promotion and in a loud and celebratory manner. That may not have happened, but with our
predominately freehold estate, strong Balance Sheet, and single minded focus to exit this crisis in the
best possible position, I know that we will have many milestones to celebrate in the future.
As lockdown comes to its scheduled end, it is important to note that there have been incredibly low levels
of infection recorded across pubs, restaurants and hotels. It is vital now for the mental wellbeing of the
nation that people are allowed to meet and socialise in a responsible manner, in the safe environment that
pubs, restaurants and hotels have proved they can provide.
We need our industry to reopen without onerous restrictions that deter our customers and hamper our
ability to trade profitably, and in a way that reflects the commitment we have made to ensuring our venues
are safe and coronavirus secure. The notion that closing the hospitality industry reduces infection rates
is a fallacy, as doing so forces people to socialise in the home in a completely unregulated environment
where recorded infection rates are infinitely higher.
With a vaccine on the visible horizon, we look forward to welcoming our customers back to our wonderful
pubs and hotels, returning to profitability and getting on with business as usual.
Michael Turner
Chairman
25 November 2020
CHIEF EXECUTIVE'S REVIEW
At the time of drafting this review of the last six months, all 388 of our pubs and hotels are closed, 98%
of our people are on furlough or flexi-furlough, and we are a week away from hopefully reopening the
estate. It feels like Groundhog Day, and we are awaiting the details regarding which areas will be in
which tier, but we look forward to welcoming back our customers to our wonderful pubs and hotels, that are
the epitome of great British hospitality.
Our reported figures for the first six months of the year reflect the total, temporary closure of the
business for more than half of the reporting period - resulting in total sales of £45.6 million (H1 2020:
£167.1 million). Our like for like sales for the 26 weeks stand at 75% of the previous year (H1 2020:
+2.7%). However, we were encouraged by the like for like run rate, which illustrated how quickly consumer
confidence built as we reopened the estate from 4 July 2020. By the end of July, sales were at 68% of
prior year levels on a like for like basis, and at the end of August - following the success of the
Government's inspired Eat Out to Help Out scheme - 79% of our pubs were open and we were trading at 78% of
prior year levels.
Sales momentum had been steadily building but the introduction of ever-tightening restrictions, despite
hospitality accounting for a tiny percentage of infections, knocked consumer confidence and impacted
trading. The rule of six came into force in mid-September, causing like for like sales for that week to
fall to 68% of prior year. This was followed on 24 September 2020 by the introduction of the 10pm curfew
and the news that all customers must be seated to order food or drink in a pub. This further impacted
consumer confidence and sales dropped to 58% of prior year levels on a like for like basis for the
following week.
The introduction of the tier system had the largest impact of all. On 17 October 2020, when London was
moved into Tier 2 and people were once again encouraged to work from home, leaving the City like a ghost
town, like for like sales in 37 of our largest Central London sites fell to less than 30% of the previous
year. This has led to our like for like sales, across the estate, finishing at 57% for the final week of
October.
Despite the obstacles that we have had to overcome, we have used the time well to innovate, particularly
on the digital front, invest in our estate, and complete the process of ensuring we have the right people
in place to hit the ground running when we reopen again to welcome our customers.
Rightsizing for the future
At the start of the financial year, we completed the delivery of the Transitional Services Agreement
("TSA") with Asahi and the integration of the support functions for both Bel & The Dragon and Cotswold
Inns & Hotels. The sale of The Stable Pizza and Cider Limited ("The Stable"), a leasehold business, to
Three Joes was also completed during the period.
Following the sale of the Fuller's Beer Business, we had identified a number of changes that could be made
in our central functions, leading to a leaner, more efficient, support centre team. This exercise has been
completed during the period, and the business is perfectly poised, with the right team in place, to
deliver sustainable, profitable growth in the future both organically and through acquisitions and
developments.
It is clear trading will take time to return to pre-coronavirus levels and we have streamlined the teams
across our pubs and hotels accordingly. The result of this exercise, combined with the fact that 300 team
members moved under TUPE with sale of The Stable, means our total employee numbers are already 20% below
where they were at the beginning of the financial year. I am pleased to report that, due to a structured
redeployment programme, we have reassigned as many team members as we have made redundant.
Accelerating and investing in innovation
Crisis often accelerates change in businesses - and Fuller's has been no exception. The current situation
has altered consumer behaviour and made us think differently about the way we operate, resulting in a
number of planned initiatives being rolled out earlier than intended.
We launched Order & Pay - a web-based solution that asks customers to scan a QR code displayed on the
table, allowing them to browse the menu, choose items, and order and pay their bill without the need for
interaction with a team member. We started in a handful of sites when we reopened in July, where it proved
popular and successful. It is now operational in around 75% of our Managed Pubs and Hotels, with the rest
of our Managed sites due to come online over the coming months.
It has led to some interesting insights into consumer behaviour, with customers choosing dishes and drinks
they have not tried before, now they have the luxury of carefree browsing time, and our team members have
more quality time to spend with customers as they serve the customers' tables.
The work that has been carried out in recent years on our single customer view database has also paid
dividends - as communication has become key due to the ever-changing regulations. We have used clear
targeting with offers for those sites that are struggling the most and been able to tactically drive
bookings by communicating to specific sectors of the database according to geography and demographics.
A perfectly balanced and well-invested estate
Strategically, Fuller's has always understood the importance for a long-term business to invest in and
operate a balanced estate in terms of both style and geography - and the difference in trading across the
estate has been more marked than ever during the coronavirus pandemic. Throughout the summer, alfresco
dining and staycations were the order of the day - while those sites in city centres that depend on office
workers and international tourists, were naturally harder hit.
Typically, our top performing pubs by revenue and EBITDA, are those in Central London and transport hub
sites. For the first six months of this financial year, those are the sites that have suffered most,
particularly due to the stay at home message - so the natural balance of our estate has come into play.
The purchase of the Cotswold Inns & Hotels business could not have been more timely and during August and
September, five of our highest turnover sites (and three of our most profitable) came from this part of
the business.
When we acquired the Cotswold business just over a year ago, we believed that we could add value to an
already successful business by building more local trade and increasing the revenue from food and beverage
sales to those who lived locally or within driving distance. The venues were famous for their wedding
trade and this was one of the key sources of revenue.
The possible outcome of so many weddings being cancelled could have been a problem - but a successful,
targeted, digital staycation campaign and the widespread growth in domestic tourism have resulted in the
Cotswold business outperforming its sales from the prior year. We will, in future, use the data we have
captured and creative and innovative marketing to build on this staycation trend. In addition, the
restaurants have outperformed our expectations and provided a welcome reminder that this delightful
business is a perfect fit for Fuller's and our customers.
During the period, we continued with committed capex projects and this included opening a new pub, The
White Horse in Wembley. The pub is located in the shadow of the iconic Wembley Arch and in an area that is
benefiting from a large mixed-use redevelopment and the addition of over 6,000 new homes. The pub looks
amazing and opened strongly, with local residents giving it the seal of approval. We look forward to the
return of the large events close by that will generate high earning days for the pub, but even now The
White Horse has become a firm favourite in Wembley.
Early on in the coronavirus pandemic, we took the decision to use the short-term opportunity created by
the enforced closure at the start of the financial year to complete a number of schemes that were already
started or scheduled - in line with our long-term strategy. Highlights have included The Trinity at
Borough, which we acquired in August 2019, The Windmill at Waterloo and The Coach & Horses - the iconic
Soho pub that is the backdrop for Keith Waterhouse's cult play, Jeffrey Bernard is Unwell. Outside of the
Capital, we have invested in major schemes at The Grove Lock near Leighton Buzzard and The Fox & Pelican
in Grayshott, near Hindhead.
We have been investing heavily in our external spaces and pub gardens for some years now - and this has
reaped rewards over recent months. Much of the work had also involved adding gazebos, awnings and covered
areas and we have continued to build on this activity to ensure the outside area of our pubs and hotels
provides desirable and comfortable additional trading space throughout the colder months too. The success
and scale of our outside areas was particularly visible during September when we hosted our ever-popular
Shakespeare in the Garden, with The Tempest being profitably delivered to a socially distanced audience in
15 venues across our Managed and Tenanted estate.
The property team also used the first part of the financial year to good effect by undertaking a number of
smaller, decorative schemes across the Bel & The Dragon and Cotswold Inns & Hotels sites, again using the
period of temporary closure well. This helped to ensure we realised the benefit of the rise in
staycations. One of these schemes has seen a complete reimagining of the restaurant at The Bear of
Rodborough in Stroud - creating a stunning and imposing dining space with breathtaking views, which is
already proving popular with hotel residents and local diners alike.
Tenanted Inns
During lockdown, our Tenants have consistently shown innovation and commitment to their local communities,
providing meals for the homeless and opening as local stores. I am consistently delighted by their
entrepreneurial nature and creativity, and it was great to see them reopening so quickly and strongly.
Our like for like profits in this part of the business are down 19% for the period. Fuller's led the way
in the industry with the suspension of all commercial rent during both the initial lockdown and the
current closure. This has been widely welcomed by our Tenants and given them the breathing space they need
to ensure their businesses survive, flourish and were in a position to reopen strongly when the time came.
Suspending all commercial rent was a bold move - but there have been knock-on benefits for the Company
too. Combined with the grants available to small businesses, our Tenants exited the first lockdown in a
position of strength and without the shadow of debt to hold them back. We reintroduced rent on a tapered
basis in August and this had been slowly increasing until the start of the current lockdown, when we once
again took the decision to suspend it.
FINANCIAL POSITION
Group revenue and other income fell by 72.7% to £45.6 million (H1 2020: £167.1 million). Adjusted
loss 3 1 was £22.2 million (H1 2020: profit £17.9 million) showing the severe impact the coronavirus
pandemic and the resulting government regulations have had on the Group. The results for the period
reflect 14 weeks of zero trade where the Group incurred an operating loss of £16.3 million 4 2 , a period
of transition which saw a phased reopening of the estate from 4 July 2020 (loss of £3.6 million2) and the
final two months where the majority of the estate was open albeit trading with severe restrictions (profit
of £2.0 million2). The final two months show that the Group was able to rapidly return to profitability
once the estate had reopened despite the ongoing restrictions and reduced capacity in the pubs.
The sales performance across the Group during the two months of trading reflected the balanced nature of
our estate with rural pubs outperforming the prior year with like for like sales of 103% while pubs
located in the City naturally saw like for like sales fall to just 45% in comparison with the prior year
as people continued to work from home. Cotswold Inns & Hotels, which was acquired in October 2019,
outperformed prior year for the two months and included five of our highest turnover sites despite the
restrictions on weddings.
On 7 June 2020, the Group sold The Stable to Three Joes for an enterprise value of £0.5 million, which
resulted in a loss on disposal of £0.5 million. As The Stable was sold during the period the results have
been reported within discontinued operations. The amounts shown as discontinued operations within the
financial statements are an operating loss of £0.5 million as well as the loss on disposal. As part of the
transaction, Fuller's retained ownership of the five freehold properties associated with The Stable
business.
The Group generated cash from continuing operating activities of £5.7 million in the period (H1 2020:
£20.5 million). The significant decrease is a direct result of being closed for three months within the
period and trading under restrictions for the remaining months due to the government regulations in place.
As expected, the working capital outflow the Group experienced during lockdown started to recover on
reopening.
During the period, £33 million of our bank facilities expired. At 26 September 2020, the Group had £192
million of facilities until August 2021. In May 2020, the Group issued £100 million of commercial paper
through the Bank of England Covid Corporate Financing Facility ("CCFF") taking our total facilities to
£292 million. The CCFF provides short-term unsecured debt and is repayable in May 2021. Our undrawn
facilities at 26 September 2020 were £113.0 million, with a further £18.0 million of cash held on the
Balance Sheet.
Separately disclosed items before tax from continuing operations was a charge of £0.8 million (H1 2020:
£3.7 million), which principally consists of £0.8 million reorganisation costs of which £0.6 million
related to the corporate restructure of the business where the trade and assets of Bel & The Dragon and
Cotswold Inns & Hotels were hived up into the Company. Restructuring costs also included £0.2 million of
redundancy costs. Other costs included in separately disclosed items are acquisition costs of £0.1 million
and £0.1 million of payroll costs for the initial scoping of the new finance system.
Tax has been provided for at an effective rate before separately disclosed items of 17.1% (H1 2020:
19.6%). Deferred tax liabilities have decreased from £17.1 million at 28 March 2020 to £13.7 million due
to the recognition of a deferred tax asset for losses incurred in the period. A full analysis of the tax
charge is set out in note 5.
The net impact of these items results in basic earnings per share on continuing operations decreasing by
261% to -34.60p (H1 2020: 21.45p), with adjusted earnings per share 5 3 on continuing operations down
227% at -33.33p (H1 2020: 26.17p).
The deficit on the defined benefit pension scheme has increased by £6.1 million from the year end to £10.8
million (28 March 2020: £4.7 million, 28 September 2019: £34.4 million). The increase was due to the fall
in discount rate and is only marginally offset by the improvement in asset returns.
CURRENT TRADING AND PROSPECTS
While our pubs are temporarily closed again, the imminent roll out of a vaccine is excellent news for the
future. The tightening of the tier system will present further challenges over the winter months, but we
welcome the Prime Minister's comments that we will see the need for restrictions fall away in the spring.
Without doubt, a return to normality is in sight.
When the current lockdown was announced, we acted swiftly to implement the lessons learned last time round
and this latest closure has been made with minimal stock losses. We also immediately placed 98% of our
team members - across our pubs, hotels and in our support functions - on furlough or flexi-furlough,
thereby minimising our cash burn. The extension of the Coronavirus Job Retention Scheme until March 2021
provides a degree of breathing space and will allow us to apply a sensible and measured approach to costs
as we reopen our estate, particularly at the most affected sites in our city centres.
We entered this crisis in a position of strength, buoyed by the sale of the Fuller's Beer Business. We
have used the time and space created by the pandemic wisely - completing targeted investments in our
estate, rightsizing our teams and utilising the support available to manage our cash reserves where
possible. It has not been easy, but prudent financial management, an estate that is 92% freehold, and a
strong Balance Sheet mean that we will be in the best possible position to get back on a growth
trajectory.
We know our customers want to come back, we know they trust us to look after them and provide a safe and
sensible environment to enjoy a great Fuller's experience and, over and above this, we have a dedicated
and passionate team of people with the ability and desire to delight, surprise and welcome back those
customers.
We are optimistic about the future in the medium term and beyond, but there is no doubt that this will be
a tough winter and a very different looking Christmas. We will start to reopen our estate in a measured
way, navigating the tier system and the restrictions that come with it. However, it is important that we
see beyond these obstacles and look at the bigger picture. The excellent news of successful vaccines gives
us confidence where previously there was uncertainty, and with the sensible decisions we have taken during
the pandemic, Fuller's is well-placed for future success.
This business is armed with a well-invested and well-balanced, freehold estate, excellent people, robust
financial foundations, a clear and consistent strategy, and the drive and desire to lead the way out of
this crisis. The long-term future for Fuller's looks positive.
Simon Emeny
Chief Executive
25 November 2020
Fuller, Smith & Turner P.L.C.
Financial Highlights
For the 26 weeks ended 26 September 2020
Unaudited Unaudited Audited
26 weeks ended 26 26 weeks ended 28 52 weeks ended 28
September September March
2020 2019 2020
£m £m £m
Revenue and other income 45.6 167.1 319.7
EBITDA1 (3.7) 34.9 53.9
Adjusted (loss)/profit before tax2 (22.2) 17.9 19.4
Statutory (loss)/profit before tax (23.0) 14.2 8.4
(24.0) 176.2 166.2
Group statutory (loss)/profit
before tax
Basic earnings per share3 (34.60p) 21.45p 7.62p
Dividend per share3 - 7.80p 132.80p
Net debt excluding lease 187.4 23.0 178.9
liabilities4
All figures above are from continuing operations except where stated.
1. Pre-separately disclosed earnings before interest, tax, depreciation, loss on disposal of plant and
equipment and amortisation.
2. Adjusted (loss)/profit before tax is the (loss)/profit before tax excluding separately disclosed
items.
3. Calculated on a 40p ordinary share for continuing operations.
4. Net debt comprises cash and short term deposits, bank overdraft, bank loans, CCFF, debenture stock and
preference shares.
Fuller, Smith & Turner P.L.C.
Condensed Group Income Statement
For the 26 weeks ended 26 September 2020
Unaudited Unaudited Audited
Continuing operations Note 26 weeks ended 26 26 weeks ended 28 52 weeks ended 28
September 2020 September 2019 March 2020
£m £m £m
Revenue 2 45.4 165.1 316.0
Operating costs before separately disclosed (63.5) (145.7) (292.7)
items
Other income 2 0.2 2.0 3.7
Adjusted operating (loss)/profit 2 (17.9) 21.4 27.0
Operating separately disclosed items 3 (1.0) (3.0) (20.1)
Operating (loss)/profit (18.9) 18.4 6.9
Finance costs before separately disclosed items 4 (4.3) (3.5) (7.6)
Financing separately disclosed items 3,4 0.2 (0.3) (0.5)
(Loss)/profit on disposal of properties 3 - (0.4) 9.6
(Loss)/profit before tax (23.0) 14.2 8.4
Adjusted (loss)/profit before tax (22.2) 17.9 19.4
Total separately disclosed items 3 (0.8) (3.7) (11.0)
(Loss)/profit before tax (23.0) 14.2 8.4
Income tax expense 5 3.9 (2.4) (4.2)
Analysed as:
Underlying trading 3.8 (3.5) (6.2)
Separately disclosed items 3 0.1 1.1 2.0
(Loss)/profit for the year from continuing (19.1) 11.8 4.2
operations
Net (loss)/profit after tax from discontinued 11 (1.2) 161.9 157.7
operations
(Loss)/profit for the year (20.3) 173.7 161.9
Fuller, Smith & Turner P.L.C.
Condensed Group Income Statement (continued)
For the 26 weeks ended 26 September 2020
Audited
Unaudited Unaudited
52 weeks ended 28
Group Note 26 weeks ended 26 26 weeks ended 28 March
September 2020 September 2019
2020
Pence Pence
Pence
(Loss)/earnings per share per 40p 'A' and 'C'
ordinary share
Basic 6,11 (36.77) 315.73 293.70
Diluted 6,11 (36.58) 311.87 293.02
(Loss)/earnings per share per 4p 'B' ordinary
share
Basic 6,11 (3.68) 31.57 29.37
Diluted 6,11 (3.66) 31.19 29.30
Continuing operations
(Loss)/earnings per share per 40p 'A' and 'C'
ordinary share
Basic 6 (34.60) 21.45 7.62
Diluted 6 (34.42) 21.19 7.60
(Loss)/earnings per share per 4p 'B' ordinary
share
Basic 6 (3.46) 2.14 0.76
Diluted 6 (3.44) 2.12 0.76
Fuller, Smith & Turner P.L.C.
Condensed Group Statement of Comprehensive Income
For the 26 weeks ended 26 September 2020
Unaudited Unaudited
Audited
26 weeks ended 26 26 weeks ended 28
September 2020 September 2019 52 weeks ended 28
March
£m £m
2020
£m
Note
(Loss)/profit for the period (20.3) 173.7 161.9
Items that may be reclassified to profit or
loss
Net gains/(losses) on valuation of financial
assets and liabilities 0.2
0.2 (0.1)
Tax related to items that may be reclassified
to profit or loss 5
- - (0.1)
Items that will not be reclassified to profit
or loss
Net actuarial (losses)/gains on pension schemes 10
(7.1) 1.3 5.9
Tax related to items that will not be
reclassified to profit or loss 5
1.3 (0.2) (1.1)
Other comprehensive (loss)/income for the
period, net of tax
(5.6) 1.0 4.9
Total comprehensive (loss)/income for the
period, net of tax
(25.9) 174.7 166.8
Fuller, Smith & Turner P.L.C.
Condensed Group Balance Sheet
26 September 2020
Unaudited Unaudited
Audited
Note At 26 September 2020 At 28 September 2019
At 28 March
£m £m
2020
£m
Non-current assets
Intangible assets 28.1 37.9 28.3
Property, plant and equipment 8 607.5 559.7 617.7
Investment properties 3.9 4.6 4.8
Other non-current assets 0.1 0.1 0.1
Right-of-use assets 88.9 86.7 107.0
Total non-current assets 728.5 689.0 757.9
Current assets
Inventories 3.1 5.2 4.0
Trade and other receivables 11.5 14.0 12.6
Cash and cash equivalents 9 18.0 44.2 20.3
Assets classified as held for sale 8.3 - 2.6
Current tax receivable 3.8 2.4 6.2
Total current assets 44.7 65.8 45.7
Current liabilities
Trade and other payables (43.2) (37.4) (37.7)
Borrowings 9 (177.9) - (171.7)
Financial liabilities - lease liabilities 9 (8.0) (8.4) (8.9)
Provisions (4.1) (0.2) (4.1)
Total current liabilities (233.2) (46.0) (222.4)
Non-current liabilities
Borrowings 9 (27.5) (67.2) (27.5)
Financial liabilities - lease liabilities 9 (86.1) (87.4) (104.0)
Other financial liabilities (0.8) (1.4) (1.1)
Retirement benefit obligations 10 (10.8) (34.4) (4.7)
Deferred tax liabilities (13.7) (10.0) (17.1)
Total non-current liabilities (138.9) (200.4) (154.4)
Net assets 401.1 508.4 426.8
Fuller, Smith & Turner P.L.C.
Condensed Group Balance Sheet (continued)
26 September 2020
Unaudited Unaudited
Audited
Note At 26 September 2020 At 28 September 2019
At 28 March
£m £m
2020
£m
Capital and reserves
Share capital 22.8 22.8 22.8
Share premium account 4.2 4.8 4.2
Capital redemption reserve 3.7 3.1 3.7
Own shares (17.0) (17.2) (17.1)
Hedging reserve (0.7) (1.1) (0.9)
Retained earnings 388.1 496.0 414.1
Total equity 401.1 508.4 426.8
Fuller, Smith & Turner P.L.C.
Condensed Group Statement of Changes in Equity
For the 26 weeks ended 26 September 2020
Share Capital
Unaudited - 26 weeks ended Share premium redemption Own Hedging Retained Total
26 September 2020 capital account reserve shares reserve earnings £m
£m £m £m £m £m £m
Deferred
shares
£m
At 28 March 2020 22.8 4.2 - 3.7 (17.1) (0.9) 414.1 426.8
Loss for the period - - - - - - (20.3) (20.3)
Other comprehensive
income/(loss)for the - - - - - 0.2 (5.8) (5.6)
period
Total comprehensive
income/(loss) for the - - - - - 0.2 (26.1) (25.9)
period
Shares purchased to be
held in ESOT or as - - - - - - - -
treasury
Shares released from ESOT - - - - 0.1 - (0.1) -
and treasury
Dividends (note 7) - - - - - - - -
Share-based payment - - - - - - 0.1 0.1
charges
Tax charged directly to - - - - - - 0.1 0.1
equity (note 5)
At 26 September 2020 22.8 4.2 - 3.7 (17.0) (0.7) 388.1 401.1
Unaudited - 26 weeks ended
28 September 2019
At 30 March 2019 22.8 4.8 - 3.1 (19.8) (0.8) 328.4 338.5
Profit for the period - - - - - - 173.7 173.7
Other comprehensive
(loss)/income for the - - - - - (0.1) 1.1 1.0
period
Total comprehensive
(loss)/income for the - - - - - (0.1) 174.8 174.7
period
Shares purchased to be
held in ESOT or as - - - - (0.1) - - (0.1)
treasury
Shares released from ESOT - - - - 2.7 - (0.9) 1.8
and treasury
Dividends (note 7) - - - - - - (6.8) (6.8)
Share-based payment - - - - - - 0.4 0.4
charges
Transfer to retained - - - - - 0.2 -
earnings (0.2)
Tax credited directly to - - - - - - (0.1) (0.1)
equity (note 5)
At 28 September 2019 22.8 4.8 - 3.1 (17.2) (1.1) 496.0 508.4
Fuller, Smith & Turner P.L.C.
Condensed Group Statement of Changes in Equity (continued)
For the 26 weeks ended 26 September 2020
Share Share Capital Own Hedging Retained
capital premium redemption shares reserve earnings Total
£m account reserve £m £m £m £m
£m Deferred Share £m
Audited - 52 weeks ended 28 £m
March 2020
At 30 March 2019 22.8 4.8 - 3.1 (19.8) (0.8) 328.4 338.5
Profit for the year - - - - - - 161.9 161.9
Other comprehensive income - - - - - 0.1 4.8 4.9
for the year
Total comprehensive income - - - - - 0.1 166.7 166.8
for the year
Issue of share capital 0.6 (0.6) - - - - - -
Reclassification of deferred (0.6) - 0.6 - - - - -
shares
Cancellation of deferred - - (0.6) 0.6 - - - -
shares
Shares purchased to be held - - - - (0.5) - - (0.5)
in ESOT or as treasury
Shares released from ESOT and - - - - 3.2 - (1.1) 2.1
treasury
Dividends (note 7) - - - - - - (80.5) (80.5)
Share-based payment charges - - - - - - 0.5 0.5
Transfer to retained earnings - - - - - (0.2) 0.2 -
Tax debited directly to - - - - - - (0.1) (0.1)
equity
Total transactions with - - - - 2.7 (0.2) (81.0) (78.5)
owners
At 28 March 2020 22.8 4.2 - 3.7 (17.1) (0.9) 414.1 426.8
Fuller, Smith & Turner P.L.C.
Condensed Group Cash Flow Statement
For the 26 weeks ended 26 September 20120
Unaudited Unaudited
Audited
Note 26 weeks ended 26 26 weeks ended 28
September 2020 September 2019 52 weeks ended
28 March
£m £m
2020
£m
(Loss)/profit before tax for continuing operations (23.0) 14.2 8.4
Net finance costs before separately disclosed 4 4.3 3.5 7.6
items
Separately disclosed items 3 0.8 3.7 11.0
Depreciation and amortisation 2 14.2 13.5 26.9
(3.7) 34.9 53.9
Difference between pension charge and cash paid (1.1) (0.7) (2.3)
Share-based payment charges 0.1 0.5 0.5
Contribution to pension fund - - (24.0)
Change in trade and other receivables 0.7 (2.1) (1.1)
Change in inventories 0.6 (0.3) 1.1
Change in trade and other payables 6.3 (2.3) (1.5)
Cash impact of operating separately disclosed 3 (0.8) (2.2) (5.0)
items
Cash generated from operations 2.1 27.8 21.6
Tax received/(paid) 3.6 (7.3) (10.1)
Cash generated from operating activities - 5.7 20.5 11.5
continuing operations
Cash (absorbed)/generated from operating 11 (0.5) 1.5 1.5
activities - discontinued operations
Cash generated from operating activities 5.2 22.0 13.0
Cash flow from investing activities
Business combinations - (3.7) (32.8)
Purchase of property, plant and equipment and (7.3) (13.4) (46.7)
intangible assets
Sale of property, plant and equipment - - 11.4
Cash absorbed by investing activities - continuing (7.3) (17.1) (68.1)
operations
Cash generated investing activities - discontinued 11 0.3 230.6 224.5
operations
Net cash (outflow)/inflow from investing (7.0) 213.5 156.4
activities
Cash flow from financing activities
Purchase of own shares - (0.1) (0.5)
Receipts on release of own shares to option - 1.8 2.3
schemes
Interest paid (2.4) (2.7) (4.7)
Preference dividends paid (0.1) (0.1) (0.1)
Equity dividends paid 7 - (6.8) (80.5)
Issue of commercial paper 99.4 - -
Repayment of bank loans (93.0) (188.9) (65.4)
Principal elements of lease payments (4.3) (5.1) (10.3)
Fuller, Smith & Turner P.L.C.
Condensed Group Cash Flow Statement (continued)
For the 26 weeks ended 26 September 2020
Unaudited Unaudited
Note 26 weeks ended 26 26 weeks ended 28 Audited
September 2020 September 2019
52 weeks ended 28
£m £m March 2020
£m
Cash absorbed by financing activities (0.4) (201.9) (159.2)
continued
Cash absorbed by financing activities (0.1) (0.4) (0.9)
discontinued
Net cash (outflow) from financing activities (0.5) (202.3) (160.1)
Net movement in cash and cash equivalents 9 (2.3) 33.2 9.3
Cash and cash equivalents at the start of the 20.3 11.0 11.0
period
Cash and cash equivalents at the end of the 9 18.0 44.2 20.3
period
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
1. Half Year Report
Basis of Preparation
The half year financial statements for the 26 weeks ended 26 September 2020 have been prepared in
accordance with the Disclosure and Transparency Rules ("DTRs") of the Financial Conduct Authority and with
International Accounting Standard ("IAS") 34, Interim Financial Reporting, as adopted by the European
Union and should be read in conjunction with the Annual Report and Financial Statements for the 52 weeks
ended 28 March 2020, which have been prepared in accordance with International Financial Reporting
Standards ("IFRS") as adopted by the European Union.
The half year financial statements do not constitute full accounts as defined by Section 434 of the
Companies Act 2006. The figures for the 52 weeks ended 28 March 2020 are derived from the published
statutory accounts. Full accounts for the 52 weeks ended 28 March 2020, including an unqualified auditor's
report which did not make any statement under Section 498 of the Companies Act 2006, have been delivered
to the Registrar of Companies.
The Board has adopted the going concern basis in preparing these accounts after assessing the Group's
principal risks including the risks arising from the coronavirus pandemic. The Board is confident that the
Group has sufficient liquidity and the ability to access resources when the Group needs to refinance to
withstand another prolonged period of closure as a result of the coronavirus pandemic.
The outbreak of coronavirus, and its continuing impact on the economy, casts uncertainty as to the future
financial performance and cash flows of the Group. When assessing the ability of the Group to continue as
a going concern, the Board has considered the Group's financing arrangements, the pattern of trading since
reopening on 4 July 2020, the second lockdown on 5 November and future trading risks, including a
protracted lockdown or the possibility that when the pubs reopen there will be tight restrictions akin to
those of Tier 3.
At 26 September 2020, the Group had existing facilities of £192 million, all of which expiring in August
2021. The Group has also accessed the Bank of England Covid Corporate Financing Facility ("CCFF")
programme which have already issued £100 million of commercial paper. The CCFF provides short-term
unsecured debt and is repayable in May 2021.
The bank facilities are subject to two main covenants, which are tested quarterly: net debt to EBITDA
(leverage) and EBITDA to net finance charges. In recognition of the current macroeconomic uncertainty, the
Group's banks have revised the covenant tests to a liquidity test for the quarters ending March, June,
September and December 2020.
In undertaking a going concern review, the Board has considered two main scenarios prepared by management:
• Management have prepared the Group's base case forecast, which is based on current trading trends and
takes into account the Government's recent decision to have another national lockdown and to extend
the furlough scheme until end of March 2021. It also assumes steady improvement in trading, with
pre-coronavirus sales level not returning until FY23.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
1. Half Year Report (continued)
In the base case forecast, the Group would need to refinance all its facilities when they expire in August
2021 to the same level of facilities the Group currently has (excluding the CCFF). Under this scenario the
Group would also need to seek waivers from its lending banks until the end of the period of assessment for
going concern.
• Management have also prepared a stress case, which reflects a severe but plausible scenario and
assumes the national lockdown lasts for three months, with no additional government support over that
already announced and with the extension of the furlough scheme until the end of March 2021. Again, it
assumes steady improvement in trading, with pre-coronavirus sales level not returning until FY23.
In this scenario, again it shows that in August 2021 the Group would need to refinance its loans to a
similar level of debt the Group currently has (excluding the CCFF). Under this scenario the Group would
also need to seek waivers from its lending banks until the end of the period of assessment for going
concern.
The Board has concluded that in both scenarios, the Group has sufficient debt facilities to finance
operations for at least the next 12 months, subject to the ability to refinance in August 2021 to a
similar level of the facilities it currently has and the revision of the covenants attached to those
facilities beyond December 2020.
The Board is confident in securing both the revision of the covenant beyond December 2020 and obtaining
facilities beyond August 2021 but given that these are not in place at the date of approving these
financial statements a material uncertainty exists that may cast significant doubt on the Group's ability
to continue as a going concern. Accepting the two material uncertainties that may cast significant doubt
about the Group's ability to continue as a going concern, the Board has a reasonable expectation that the
Company has adequate resources to continue in operational existence for the foreseeable future. For these
reasons, it continues to adopt the going concern basis in preparing the half year financial statements.
The half year financial statements were approved by the Directors on 25 November 2020.
New accounting standards
The accounting policies adopted in the preparation of the half year financial statements are consistent
with those followed in the preparation of the Group's annual consolidated financial statements for the
year ended 28 March 2020. The Group has not early adopted any standard, interpretation or amendment that
has been issued but is not yet effective.
Other amendments to accounting standards applied from 28 March 2020 were as follows:
* Definition of Material - amendments to IAS 1 and IAS 8
* Definition of a Business - amendments to IFRS 3
* Revised Conceptual Framework for Financial Reporting
* Interest Rate Benchmark Reform - amendments to IFRS 9, IAS 39 and IFRS 7
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
1. Half Year Report (continued)
The application of these did not have a material impact on the Group's accounting treatment and has
therefore not resulted in any material changes.
Taxation
Taxes on income in the interim periods are accrued using the tax rate that is expected to be applicable to
total annual earnings for the full year in each tax jurisdiction based on substantively enacted or enacted
tax rates at the interim date.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
2. Segmental Analysis
Managed Pubs Tenanted
Unaudited - 26 weeks ended Unallocated1 Total continuing operations
26 September 2020 and Hotels Inns
£m £m
£m £m
Revenue and other income 39.4 6.0 0.2 45.6
Segment result (10.6) 1.3 (8.6) (17.9)
Operating separately disclosed items (1.0)
Operating loss (18.9)
Profit on disposal of properties -
Net finance costs (4.1)
Loss before tax (23.0)
Other segment information
Additions: property, plant and 6.5 0.3 0.5 7.3
equipment
Business combinations - - - -
Depreciation and amortisation 12.6 0.9 0.7 14.2
Impairment of property and - - - -
right-of-use assets
Managed Tenanted
Pubs Unallocated1 Total continuing
Unaudited - 26 weeks ended Inns operations
28 September 2019 and Hotels £m
£m £m
£m
Revenue and other income 149.1 16.0 2.0 167.1
Segment result 23.2 6.6 (8.4) 21.4
Operating separately disclosed items (3.0)
Operating profit 18.4
Loss on disposal of properties (0.4)
Net finance costs (3.8)
Profit before tax 14.2
Other segment information
Additions: property, plant and 11.8 0.7 0.2 12.7
equipment
Business combinations - 3.7 - 3.7
Depreciation and amortisation 12.3 1.0 0.2 13.5
Impairment of property and 0.9 - - 0.9
right-of-use assets
1 Unallocated expenses represent primarily the salary and costs of central management. Unallocated revenue
represents Transitional Services Agreement income.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
2. Segmental Analysis (continued)
Managed Pubs Tenanted Total continuing
Audited - 52 weeks ended Unallocated1 operations
28 March 2020 and Hotels Inns
£m £m
£m £m
Revenue and other income 286.3 29.7 3.7 319.7
Segment result 30.6 11.8 (15.4) 27.0
Operating separately disclosed items (20.1)
Operating profit 6.9
Profit on disposal of properties 9.6
Net finance costs (8.1)
Profit before tax 8.4
Other segment information
Additions: property, plant and equipment 3.6 23.6 50.8
23.6
Business combinations - - 32.8
32.8
Depreciation and 2.0 0.1 26.9
amortisation 24.8
Impairment of property, right-of-use assets and 14.4 0.7 - 15.1
goodwill
1 Unallocated expenses represent primarily the salary and costs of central management. Unallocated revenue
represents Transitional Services Agreement income.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
3. Separately Disclosed Items
Unaudited Unaudited
Audited
26 weeks ended 26 26 weeks ended 28
Continuing operations September 2020 September 2019 52 weeks ended 28 March
£m £m 2020
£m
Amounts included in operating (loss)/profit:
Acquisition costs (0.1) (0.2) (1.4)
Reorganisation costs (0.8) (0.5) (2.1)
Impairment of properties, right-of-use assets - (0.9) (15.1)
and intangible assets
IT maintenance, support and rectification - (1.4) (1.5)
costs
Replacement of central finance system (0.1) - -
Total separately disclosed items included in (1.0) (3.0) (20.1)
operating (loss)/profit
(Loss)/profit on disposal of properties - (0.4) 9.6
Separately disclosed finance costs:
Finance charge on net pension liabilities - (0.4) (0.6)
(note 10)
Finance credit on the expiry/cancellation of 0.2 0.1 0.1
interest rate swaps
Total separately disclosed finance costs 0.2 (0.3) (0.5)
Total separately disclosed items before tax (0.8) (3.7) (11.0)
Separately disclosed tax:
Profit on disposal of properties - - (1.9)
Other items 0.1 1.1 3.9
Total separately disclosed tax 0.1 1.1 2.0
Total separately disclosed items (0.7) (2.6) (9.0)
Acquisition costs of £0.1 million during the 26 weeks ended 26 September 2020 (28 September 2019: £0.2
million, 28 March 2020: £1.4 million) relates to transaction costs on property acquisitions.
The reorganisation costs of £0.8 million during the 26 weeks ended 26 September 2020 were incurred as a
result of the corporate restructure, where the trade and assets of the Bel & The Dragon and Cotswolds Inns
& Hotels were hived up into the Company, Also, this includes redundancy costs as a result of the
restructuring because of coronavirus pandemic (28 September 2019: £0.5million, 28 March 2020: £2.1
million).
Replacement of central finance system costs of £0.1 million were incurred in the period for project costs
for the initial scoping to implement a new finance system.
The cash impact of operating separately disclosed items before tax for the 26 weeks ended 26 September
2020 was £0.8 million cash outflow (28 September 2019: £2.2 million cash outflow, 28 March 2020: £5.0
million cash outflow).
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
4. Finance Costs
Unaudited Unaudited
Audited
26 weeks ended 26 26 weeks ended 28
September 2020 September 2019 52 weeks ended 28
March
£m £m
2020
£m
Finance income
Interest income from financial assets - - 0.2
Finance costs
Interest expense arising on:
Financial liabilities at amortised cost - loans and (2.7) (2.3) (5.3)
debentures
Financial liabilities at amortised cost - preference (0.1) (0.1) (0.1)
shares
Financial liabilities at amortised cost - lease (1.5) (1.1) (2.4)
liabilities
Total interest expense for financial liabilities (4.3) (3.5) (7.8)
Total finance costs before separately disclosed (4.3) (3.5) (7.6)
items
Finance charge on net pension liabilities (note 10) - (0.4) (0.6)
Finance credit on the expiry/cancellation of 0.2 0.1 0.1
interest rate swaps
Total finance costs (4.1) (3.8) (8.1)
During the period, the Group accessed Covid Corporate Financing Facility ('CCFF') whereby commercial paper
was issued to the Bank of England at a favourable rate and therefore deemed to constitute a government
grant. The debt has been recognised within current borrowings on the Balance Sheet date at fair value,
with the grant element, reflecting the favourable rate, recognised as deferred income within trade and
other payables. Finance costs are net of grant income recognised on the amortisation of the deferred
income.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 28 September 2019
5. Taxation
Unaudited Unaudited
Audited
Continuing operations 26 weeks ended 26 26 weeks ended 28
September 2020 September 2019 52 weeks ended 28
March
£m £m
2020
£m
Tax on (loss)/profit on ordinary activities
Current income tax:
Corporation tax - 2.3 0.8
Amounts over provided in previous years - - 0.1
Total current income tax - 2.3 0.9
Deferred tax:
Origination and reversal of temporary (3.9) 0.1 1.4
differences
Change in corporation tax rate - - 1.6
Amounts over provided in previous years - - 0.3
Total deferred tax (3.9) 0.1 3.3
Total tax (credited)/charged in the Income (3.9) 2.4 4.2
Statement
Tax relating to items charged to the Statement of
Comprehensive Income
Deferred tax:
Tax charge on valuation gains on financial assets and - - 0.1
liabilities
Tax (credit)/charge on actuarial gains on pension scheme (1.3) 1.1
0.2
Tax (credit)/charge included in the (1.3) 0.2 1.2
Statement of Comprehensive Income
Tax relating to items (credited)/charged directly to equity
Deferred tax:
Increase in deferred tax liability due to indexation - - -
Share-based payments (0.1) 0.1 0.1
Tax (credit)/charge included in the Statement of Changes in (0.1) 0.1 0.1
Equity
The taxation charge is calculated by applying the Directors' best estimate of the annual effective tax
rate to the profit for the period.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
6. (Loss)/Earnings Per Share
Unaudited Unaudited
Audited
Continuing operations 26 weeks ended 26 26 weeks ended 28
September 2020 September 2019 52 weeks ended 28
March
£m £m
2020
£m
(Loss)/profit attributable to equity shareholders (19.1) 11.8 4.2
Separately disclosed items net of tax 0.7 2.6 9.0
Adjusted (loss)/earnings attributable to equity (18.4) 14.4 13.2
shareholders
Number Number Number
Weighted average share capital 55,205,000 55,015,000 55,124,000
Dilutive outstanding options and share awards 287,000 681,000 128,000
Diluted weighted average share capital 55,492,000 55,696,000 55,252,000
40p 'A' and 'C' ordinary share Pence Pence Pence
Basic (loss)/earnings per share (34.60) 21.45 7.62
Diluted (loss)/earnings per share (34.42) 21.19 7.60
Adjusted (loss)/earnings per share (33.33) 26.17 23.95
Diluted adjusted (loss)/earnings per share (33.16) 25.85 23.89
4p 'B' ordinary share Pence Pence Pence
Basic (loss)/earnings per share (3.46) 2.14 0.76
Diluted (loss)/earnings per share (3.44) 2.12 0.76
Adjusted (loss)/earnings per share (3.33) 2.62 2.39
Diluted adjusted (loss)/earnings per share (3.32) 2.59 2.39
For the purposes of calculating the number of shares to be used above, 'B' shares have been treated as one
tenth of an 'A' or 'C' share. The earnings per share calculation is based on earnings from continuing
operations and on the weighted average ordinary share capital which excludes shares held by trusts
relating to employee share options and shares held in treasury of 1,779,745
(28 September 2019: 1,969,717, 28 March 2020: 1,860,777).
Diluted earnings per share is calculated using the same earnings figure as for basic earnings per share,
divided by the weighted average number of ordinary shares outstanding during the period plus the weighted
average number of ordinary shares that would be issued on the conversion of all the dilutive potential
ordinary shares into ordinary shares.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
6. (Loss)/Earnings Per Share (continued)
Adjusted earnings per share is calculated on profit before tax excluding separately disclosed items and on
the same weighted average ordinary share capital as for the basic and diluted earnings per share. An
adjusted earnings per share measure has been included as the Directors consider that this measure better
reflects the underlying earnings of the Group.
7. Dividends
Unaudited Unaudited Audited
26 weeks 26 weeks 52 weeks
ended ended ended
26 September 28 September 28 March
2020 2019 2020
£m £m £m
Declared and paid during the period
Second interim in the period for 2019 - 4.4 4.4
First dividend paid in period for 2019 - 2.4 2.4
First interim paid in period for 2020 - - 4.3
'D' Share single dividend for 2020 - - 69.4
Equity dividends paid - 6.8 80.5
Dividends on cumulative preference shares (note 4) 0.1 0.1 0.1
Pence Pence Pence
Dividends per 40p 'A' and 'C' ordinary share
declared in respect of the period
Interim - 7.80 7.80
- 7.80 7.80
The pence figures above are for the 40p 'A' and 'C' ordinary shares. The 4p 'B' ordinary shares carry
dividend rights of one tenth of those applicable to the 40p 'A' ordinary shares. Own shares held in the
employee share ownership trusts do not qualify for dividends as the Trustees have waived their rights.
Dividends are also not paid on own shares held as treasury shares.
As indicated in the circular published on 28 March 2019 relating to the disposal of the Fuller's Beer
Business, the Board made an additional cash return of £1.25 per 'A' and 'C' ordinary share and 12.5p per
'B' ordinary share through a 'D' share scheme. Each ordinary shareholder as at the record date was issued
with ten 'D' shares for every existing 'A' and 'C' ordinary share and one 'D' share for every one 'B'
ordinary share held at the time. Numis (acting as principal, and not as agent, nominee or trustee for the
Company) made an offer to purchase the 'D' shares for an amount of 12.5p per 'D' share (free of all
expenses and commissions). The Company accepted the offer on behalf of shareholders and paid a single
dividend to Numis as holder of all the 'D' shares of £69.4 million representing the sum of 12.5p per 'D'
share plus the stamp duty payable by Numis in connection with the purchase of all the 'D' shares in issue.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
7. Dividends (continued)
Following the approval of all the resolutions presented to the Company's Extraordinary General Meeting on
1 October 2019, 552,030,154 'D' shares of 0.1p each were allotted and issued to shareholders on 2 October
2019 on the basis of ten 'D' shares for every existing 'A' and 'C' ordinary share of 40p each and one 'D'
share for every existing 'B' ordinary share of 4p each held at the record date. Following the purchase by
Numis of all of the 'D' shares, and payment by the Company of a single dividend to Numis of £69.4 million
as holder of all of the 'D' shares on 7 October 2019, the 'D' shares were reclassified as deferred shares
of 0.1p and were immediately repurchased and cancelled by the Company on 8 October 2019.
No interim dividend has been declared (2019: 7.80p) for the 40p 'A' ordinary shares and 40p 'C' ordinary
shares, and nil (2019: 0.780p) for the 4p 'B' ordinary shares due to the impact of the coronavirus
pandemic on the business.
8. Property, Plant and Equipment
Unaudited Unaudited Audited
26 weeks 26 weeks 52 weeks
ended ended ended
26 September 28 September 28 March
2020 2019 2020
£m £m £m
Net book value at start of period 617.7 552.7 552.7
Reclassification of prior year 0.4 - -
impairment to right-of-use asset
Additions 7.3 13.0 51.7
Acquisitions - 3.7 44.3
Disposals (3.7) - (2.1)
Impairment loss net of reversals - (0.4) (8.6)
Transfers to assets classified as (4.9) - (2.2)
held for sale
Transfers to investment properties - - (0.2)
Depreciation provided during the (9.2) (8.8) (16.9)
period - continuing operations
Depreciation provided during the (0.1) (0.5) (1.0)
period - discontinued operations
Net book value at end of period 607.5 559.7 617.7
During the 26 weeks ended 26 September 2020, the Group recognised a charge of £nil (28 September 2019:
£0.4 million, 28 March 2020: £8.6 million) in respect of the write down of sites to their recoverable
value.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
9. Analysis of Net Debt
At Cash Non At
Unaudited - 26 weeks ended 26 September 2020 28 March flows cash1 26 September
2020 £m £m 2020
£m £m
Cash and cash equivalents:
Cash and short-term deposits 20.3 (2.3) - 18.0
20.3 (2.3) - 18.0
Financial liabilities
Lease liabilities (112.9) 4.4 14.4 (94.1)
(112.9) 4.4 14.4 (94.1)
Debt:
Bank loans2 (171.7) 93.0 (0.1) (78.8)
CCFF - (99.4) 0.3 (99.1)
Debenture stock (25.9) - - (25.9)
Preference shares (1.6) - - (1.6)
Total borrowings (199.2) (6.4) 0.2 (205.4)
Net debt (291.8) (4.3) 14.6 (281.5)
Unaudited - 26 weeks At Cash Non At
ended 28 September 30 March Transition to IFRS 16 flows cash1 28 September
2019 2019 £m £m £m 2019
£m £m
Cash and cash
equivalents:
Cash and short-term 11.0 - 33.2 - 44.2
deposits
11.0 - 33.2 - 44.2
Financial liabilities
Lease liabilities - (100.4) 5.5 (0.9) (95.8)
- (100.4) 5.5 (0.9) (95.8)
Debt:
Bank loans2 (228.5) - 188.9 (0.1) (39.7)
Other loans (0.2) - - 0.2 -
Debenture stock (25.9) - - - (25.9)
Preference shares (1.6) - - - (1.6)
Total borrowings (256.2) - 188.9 0.1 (67.2)
Net debt (245.2) (100.4) 227.6 (0.8) (118.8)
1 Non-cash movements relate to the amortisation of arrangement fees, arrangement fees accrued, movements
in lease liabilities and corporate acquisitions.
2 Bank loans net of arrangement fees.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
9. Analysis of Net Debt (continued)
At Cash Non At
Unaudited - 52 weeks 30 March Transition to IFRS 16 flows cash1 28 March
ended 28 March 2020 2019 £m £m £m 2020
£m £m
Cash and cash
equivalents:
Cash and short-term 11.0 - 9.3 - 20.3
deposits
11.0 - 9.3 - 20.3
Financial
liabilities
Lease liabilities - (100.4) 11.2 (23.7) (112.9)
- (100.4) 11.2 (23.7) (112.9)
Debt:
Bank loans2 (228.5) - 57.0 (0.2) (171.7)
Other loans (0.2) - - 0.2 -
Debenture stock (25.9) - - - (25.9)
Preference shares (1.6) - - - (1.6)
Total borrowings (256.2) - 57.0 - (199.2)
Net debt (245.2) (100.4) 77.5 (23.7) (291.8)
1 Non-cash movements relate to the amortisation of arrangement fees, arrangement fees accrued, movement in
lease liabilities and corporate acquisitions.
2 Bank loans net of arrangement fees.
10. Retirement Benefit Obligations
Unaudited Unaudited Audited
26 weeks 26 weeks 52 weeks
The amount included in the Balance Sheet arising from the Group's ended ended ended
obligations in respect of its defined benefit retirement plan
26 September 28 September 28 March
2020 2019 2020
£m £m £m
Fair value of Scheme assets 142.8 118.4 123.8
Present value of Scheme liabilities (153.6) (152.8) (128.5)
Deficit in the Scheme (10.8) (34.4) (4.7)
Key financial assumptions used in the valuation
of the Scheme
Rate of increase in pensions in payment 3.05% 3.25% 2.85%
Discount rate 1.50% 1.80% 2.40%
Inflation assumption - RPI 3.05% 3.25% 2.85%
Inflation assumption - CPI 2.15% 2.25% 1.95%
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
10. Retirement Benefit Obligations (continued)
Mortality Assumptions
The mortality assumptions used in the valuation of the Scheme as at 26 September 2020 are as set out in
the financial statements for the 52 weeks ended 28 March 2020.
At At At
26 September 28 September 28 March
Assets in the Scheme
2020 2019 2020
£m £m £m
Corporate bonds 31.2 29.8 26.9
Gilts - - 24.0
Index linked debt instruments 24.2 - -
UK equities - 22.7 17.0
Overseas equities 27.7 24.4 20.9
Alternatives 53.5 36.4 30.5
Cash 2.0 1.1 0.9
Annuities 4.2 4.0 3.6
Total market value of assets 142.8 118.4 123.8
Unaudited Unaudited Audited
26 weeks 26 weeks 52 weeks
ended ended ended
Movement in deficit during period
26 September 28 September 28 March
2020 2019 2020
£m £m £m
Deficit in Scheme at beginning of the period (4.7) (36.4) (36.4)
Movement in period:
Net interest cost - (0.4) (0.6)
Net actuarial (losses)/gains (7.1) 1.3 5.9
Contributions 1.0 1.1 26.4
Guaranteed Minimum Pension equalisation - - -
Deficit in Scheme at end of the period (10.8) (34.4) (4.7)
On 1 January 2015 the plan was closed to future accruals.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
11. Discontinued Operations
On 7 June 2020, the Group sold its subsidiary Stable Pizza & Cider Limited ("The Stable") to Sourdough
South Limited ("Three Joes"), for an enterprise value of £0.5 million on a debt free basis including any
cash left in the business. Accordingly, this business has been reported as discontinued operations in the
half year report for the 26 weeks ended 26 September 2020.
On the 27 April, the Group sold its entire beer business to Asahi Europe Ltd ('AEL'), a wholly owned
subsidiary of Asahi Group Holdings, Ltd ("Asahi"), for an enterprise value of £250.0 million on a debt
free basis including any cash left in the business.
The business sold comprised the entirety of Fuller's beer, cider and soft drinks brewing and production,
wine wholesaling, as well as the distribution thereof, and also includes the Griffin Brewery, Cornish
Orchards, Dark Star Brewing and Nectar Imports (referred to as the "Fuller's Beer Business"). Accordingly
they have been reported as discontinued operations in the Annual Report for the 52 weeks ended 28 March
2020.
a. Financial performance and cash flow
The financial performance and cash flow information presented reflects the operations for the period ended
7 June 2020.
Audited
Unaudited Unaudited
52 weeks ended 28
26 weeks ended 26 September 26 weeks ended 28 September 2019 March
2020
£m 2020
£m
£m
Revenue - 16.7 22.3
Segment (0.5) 0.3 (0.5)
result
Operating
separately - (2.6) (3.8)
disclosed
items
Operating (0.5) (2.3) (4.3)
loss
Net finance - (0.2) (0.3)
costs
Loss from
operating
activities - (0.5) (2.5) (4.6)
discontinued
operations
(Loss)/profit on
sale of 164.5 162.4
discontinued (0.5)
operations
(Loss)/profit
before tax - (1.0) 157.8
discontinued 162.0
operations
Taxation (0.2) (0.1)
(0.1)
Analysed as:
Underlying trading (0.2) (0.1) (0.1)
Separately - - -
disclosed items
(Loss)/profit for
the period - (1.2) 161.9
discontinued 157.7
operations
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
11. Discontinued Operations (continued)
Unaudited Unaudited Audited
26 weeks ended 26 26 weeks ended 28 52 weeks ended 28 March
September 2020 September 2019
2020
£m £m
£m
Net cash inflow from ordinary activities (0.5) 1.5 1.5
Net cash inflow from investing 0.3 230.6 224.5
activities
Net increase in cash
(absorbed)/generated by discontinued (0.2) 232.1 226.0
operations
Other segment information
Additions: property, plant and equipment - 0.3 0.9
Impairment of property and right-of-use - 2.6 3.8
assets
Depreciation and amortisation 0.1 0.9 1.6
(Loss)/earnings per share - discontinued operations
40p 'A' and 'C' ordinary share Pence Pence Pence
Basic (loss)/earnings per share (2.17) 294.28 286.08
Diluted (loss)/earnings per share (2.16) 290.68 285.42
Adjusted (loss)/earnings per share (1.27) - (1.63)
Diluted adjusted (loss)/earnings per share (1.26) - (1.63)
4p 'B' ordinary share Pence Pence Pence
Basic (loss)/earnings per share (0.22) 24.43 28.61
Diluted (loss)/earnings per share (0.22) 29.07 28.54
Adjusted (loss)/earnings per share (0.13) - (0.16)
Diluted adjusted (loss)/earnings per share (0.13) - (0.16)
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
11. Discontinued operations (continued)
(b) Details of the sale of the subsidiary
Unaudited
26 weeks ended 26 September 2020
£m
Consideration received
Cash 0.4
Carrying amount of net assets sold (0.8)
Loss on sale before income tax (0.4)
Transaction costs (0.1)
Loss net of transaction costs (0.5)
Income tax expense on loss -
Loss on sale after income tax (0.5)
As The Stable was sold prior to 26 September 2020, the assets and liabilities classified as held for sale
are no longer included in the Statement of Financial Position.
Fuller, Smith & Turner P.L.C.
Notes to the Condensed Financial Statements
For the 26 weeks ended 26 September 2020
12. Principal Risks and Uncertainties
In the course of normal business, the Group continually assesses and takes action to mitigate the various
risks encountered that could impact the achievement of its objectives. Systems and processes are in place
to enable the Board to monitor and control the Group's management of risk, which are detailed in the
Corporate Governance Report of the Annual Report and Financial Statements 2020. The principal risks and
uncertainties and their associated mitigating and monitoring controls which may affect the Group's
performance in the next six months are consistent with those detailed on pages 32 to 34 of the Annual
Report and Financial Statements 2020, and are available on the Fuller's website: 6 www.fullers.co.uk.
The most significant risk remains the impact of the coronavirus pandemic. The Group continues to take the
appropriate actions to respond to the ever-changing situation. We have successfully closed our estate
twice, taken actions to reduce our costs base, both in the short term and on a sustainable basis, and
taken advantage of the appropriate government support through the coronavirus job retention scheme,
business rates holidays and Bank of England Covid Corporate Financing Facility. We safely reopened nearly
all of our estate looking after the health and safety of our team members and our customers. We are well
placed to reopen again, react quickly to changes in restrictions and ultimately withstand long periods of
uncertainty through the strength of our Balance Sheet.
In addition, the Group faces political and economic uncertainty with regard to the outcome of Brexit
negotiations but has plans in place in order to limit any negative impacts on the Group's operations and
financial performance.
13. Shareholders' Information
Shareholders holding 40p 'C' ordinary shares are reminded that they have 30 days from
26 November 2020 should they wish to convert those 'C' shares to 'A' shares. The next available
opportunity after that will be June 2021. For further details, please contact the Company's registrars,
Computershare, on 0370 889 4096.
14. Statement of Directors' Responsibilities
The Directors confirm, to the best of their knowledge, that this condensed set of financial statements
gives a true and fair view of the assets, liabilities, financial position and profit or loss of the issuer
or the undertakings included in the consolidation as a whole and has been prepared in accordance with IAS
34, Interim Financial Reporting, as adopted by the European Union. The interim management report herein
includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:
• an indication of important events that have occurred during the first six months and their impact on
the financial statements and a description of the principal risks and uncertainties for the remaining
six months of the financial year
• disclosure of material related party transactions in the first six months and any material changes to
related party transactions.
By order of the Board
Michael Turner Adam Councell
Chairman Finance Director
25 November 2020
══════════════════════════════════════════════════════════════════════════════════════════════════════════
7 1 Excluding separately disclosed items
8 2 Excluding the impact of IFRS 16 Accounting for Leases
9 3 Excluding separately disclosed items
══════════════════════════════════════════════════════════════════════════════════════════════════════════
ISIN: GB00B1YPC344
Category Code: IR
TIDM: FSTA
LEI Code: 213800C7ACOFMRCQQW76
OAM Categories: 1.2. Half yearly financial reports and audit
reports/limited reviews
Sequence No.: 88547
EQS News ID: 1150669
End of Announcement EQS News Service
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