-Return to profit despite restricted trading
-Strong start to new financial year
-Final dividend reinstated
Pubs and hotels group Young & Co (YNGA:AIM) returned to profit for the year ended 28 March 2022 despite the challenges of Omicron over Christmas.
Trading since the period end has been 'excellent' with managed house revenues 17% higher than pre-pandemic levels. In the last five weeks sales were up 38.5% against the same period in 2021.
Full-year revenues increased 251% to £309 million which is slightly above the £304 million generated before the start of the pandemic, although slightly shy of market expectations.
This is an impressive outcome given the estate was only fully open for 36 weeks, operating under restrictions for 14 weeks and fully closed for two weeks.
Against a negative backdrop with the FTSE 100 dropping 2.5% on Thursday, Young’s shares gained 0.6% to £13.40.
PREMIUM FOCUS
Pre-tax profit of £42.1 million compares with losses of £44.5 million last year. Over the course of the year the company disposed of 56 tenanted businesses for £53 million.
Nine new pubs were added including the acquisition of six pubs and hotels. The group’s strategy is now entirely focused on the development of premium pubs and hotels in the south of England.
Chief executive Patrick Dardis commented: ‘After a quiet period on the acquisition front last year, we have made some exciting investments.
‘The most significant of these was the acquisition of six pub and hotel assets from the Lucky Onion group in Cheltenham and the Cotswolds in February 2022.
‘These predominantly freehold premium pubs and hotels perfectly complement our existing businesses in the area.’
After spending six years in the CEO role Dardis will step down in July following 20 years at the company and hand over to his successor Simon Dodd. Dodd was recruited three years ago with succession planning in mind.
FINAL DIVIDEND REINSTATED
The company returned to strong cash generation in the year with operating cash flows of £107 million compared with a cash outflow of £23 million in 2021.
Net debts were reduced by 30% to £173.8 million representing a conservative leverage ratio of 2.1 times EBITDA (earnings before interest, taxes, depreciation, and amortization).
A final dividend of 10.26p per share was reinstated which takes the full-year payout to 18.81p per share, 10% below the year to 1 April 2019.
