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great time to top up, strong company and moving back into multi revenue stream times
Absolutely. I've been more than happy to support Marston's by buying my usual Sunday tipple from the supermarket, but it's not quite the same as sitting in a garden/dining area in the pub with others.
Come rain, hail or snow I shall be lifting the glass of Ale in which ever Mars garden is open. As for Supermarket ales they're nice but nowt beats the real deal.
Trent, YoYoMa
Indeed so, we trust that when the pubs can properly open again we can see what life will look like in the post Findaly but cum Brains era.
I could use a proper pint now, from my local, I must say supermarket tins (or bottles) doesn't reall cut it for me, just can not wait for some normality to commence.
@Barchid.
Well, I've been rather slightly been distracted with the demise of Piers Morgan of late but I have been popping on here observing proceedings.
That said, it's good to see some stability in the sp here, isn't it.
For a while we did see a flurry of commuters with ramping & deramping but still as the film "the usual Suspects" still here. All is good here and with a bit of luck still here once the pubs open.
Since the shares have steadied we are no longer seeing personal predictions of very short term price movements, which to me is a good thing.
Band wagons have never appealed to me, but sensible analysis always has.
Are happy days here again?
Thank you for the response it makes sense and agree May is better than opening in April showers.
i run a franchise operation for Marston’s. I will not be reopening till we are allowed to operate indoors. We are all aiming for the May date. zoe as soon as the gov allow this type of opening. i’m of the view that very few pubs will be opening until May. It’s not a viable option . Better to take the furlough and go for early summer reopen. Opening in April will cost money.
Just been on the phone to my daughter and she says her friend who works for Marstons Inns were told that alot of pubs been told to remain shut till May/June time? Not sure to what extent this is true but I would of thought that they'd open as soon as they can to offset some funds?
I know Trent is in the game and maybe shed some light on this, perhaps it's part of a strategic plan or closing only a type of Lease etc
Shaperite you confirm my point well. Individuals owning Pubs is very risky as many I know can testify.
Hope your investment makes the return you predict.
GLA
As a short term investor I will catagorically state that I am invested in shares purely for my benefit and if Marstons do achieve an anticipated £1.15/20p within the stated year, then I will probably take the profit!! If I were interested in a medium to long term investment then I would buy my own pub!!!!
Brains retain freehold properties which over 25 years will increase in value.
Marstons are selling freehold properties to pay rent to Brains.
Brains have been in trouble for a few years, just look at their accounts. They built a new Brewery in Cardiff which came on stream just 2 years ago. Now the Brewery is for sale.
Marstons initial agreement ( 23rd Decmeber) was to rent/lease 256 pubs at a rent of £5.5m pa. The presentation last Friday discloses 25% of Brains pubs are not quality but we are still paying Rent for 256.
The Management/Lease agreement has not been fully disclosed and therefore we do not know what repairing conditions are stipulated apart from other modernisation works, for instance the 40 below par pubs. We do not know what restitution clauses , if any, are in the agreement.
Brains have been in business for over 100 years and yet have been unable to survive without help. Their problems were in place before Covid.
So far as intergrating staff, the video should be viewed as AA was adamant all Brains employees were safe. Agree over time this could change, it certainly should as it would be folly to have area staff overlapping. For the moment we must accept what AA states.
There are a number of confusing numbers which demonstrate the deal has not been fully analysed and considered.
Short term holders are looking for quick returns, a year is short term, and can talk up the SP accordingly.
Long term holders look for incremental growth not only in net income but Capital appreciation. We are not going to see that whilst selling assets to preserve the capital value of Brain's estate.
The deal benefits S A Brain more than Marstons who are taking all the risks.
Contrary to most opinions expressed on this board, I feel that the deal is beneficial to both - Brains get a guarenteed income on their estate and Marstons increase their exposure to a virtual monopoly in South Wales. Dont ever believe that there will be no alterations in how the Brains estate is run - this is business, but one needs to assess the whys and wherefores before making any alterations after all Mars only have 25 years to regret it or alter it. As an aside my experience of Brains premium bitter - Rev James is it is superb and competes with all others on the market including Mars Pedigree. Todays price is a decent entry price at circa 95/96p and will be looking for 1.15/1.20 within 12 month to achieve roughly 20%. DYOR
I did see the presentation and thought that some responses where against his consent and that someone behind him is actually pulling the strings. Time will tell and for now we are fortunate that we're still in the mid 90's/
Good morning YoYoMa, agree and pleased you have said and not me. I do believe these deals do have pot-holes even tank-traps going forward. Brains imo have been very smart even though they were severely cash stressed. I am reasonably sure the Brain's estate was not thoroughly surveyed before the deal was negotiated.....bad
If you have watched the Presentation video, I did not think RF looked that comfortable, answers were not that convincing and certainly numbers do not look right.
Barchid, there may be personal reasons for his decision, otherwise the timing is not good with so many things in transition.
It has not been mentioned, Ralph occupies 1 of the 2 Board positions on CMBC (Carlsberg have 3). Am pretty sure, because the position is nominated from our Board, Ralph's place will be vacant which from Marston's point of view could lack continuity for a short time on the Brewery Company's Board. Just hope Carlsberg do not exploit this hiatus?
Did mention some weeks ago RF was 60 in January and retirement could beckon. Not a total surprise just the timing could be better.
Good morning Barchid & FD, I must be on the other side of the fence here as I was expecting this on the back end of the CARSB deal. I feel that once the restructure as taken place as I am sure there will be a re-org and various depts will have a shift around to align to a new strategy that includes the lead balloon deal in Wales . I am not keen on the SA Brains deal tbh I think its going to be like the O2 and turn out to be a a huge white elephant that requires constant bailing.
Perhaps the bigger picture is that RF is going as he knows the future is coming and the ethics of the original Marston's are being changed against his liking.
As for SuperDischarger I think he is still advising Elon how to reverse million pound rockets back to ground safely.
Fairdealer
Very interesting timing by both of them, I certainly didn't see this one coming !
Supercharger for the board perhaps, to really put the icing on the cake ?
Well, well, is this a suprise? To some not as he has just passed his 60th, however would it have been prudent to remain whilst the company is in huge transition?
Fresh thinking is required.
Interesting John Rhys who propelled Brains agreement with Marstons, resigned as a Director on 5th February, the same day our Management agreement was completed.
@Fairdealer & Barchid.
Good points by you FD. Certainly food for thought to monitor to see how things unfold. I'll be watching and observing proceedings closely.
Fairdealer
Much more eloquently written than I did, but a precise and compelling post.
Who has the better deal?
Brains were severely distressed, financially.
Marstons see an opportunity to manage the Welsh Freehold estate
Enter an agreement (23rd December) to operate 156 pubs in mostly South and West Wales.
15 of these pubs are Leasehold which are to be operated under a management Agreement.
Brains estate employ around 1300 people, which includes Area managers etc.
Marstons agreed to pay rent from 1st April of £5.5m pa
RNS of 23rd December states, " Marstons entered into collaborative discussions with the Company with a view to preserving the Freehold Capital value ....."
RF went on to say, " These High Quality pubs are a great fit with our existing estate........"
Marstons own and operate 106 pubs in South and West Wales.
It has now emerged 25% of Brains Pubs are not high quality ( Marstons state a peppercorn rent is to be payed for 18 months)
The initial agreement is to pay £5.5m rent on the whole estate (156 pubs) That has now reduced 117 pubs and yet a 25 % reduction in rents for the first 18 months has not been calculated. This would amount to approx. £1.37m, which would go some way towards the £2m stated as a central overhead to operate the additional pubs.
Marstons have made clear the additional Pubs will fit well with it's existing estate and yet when asked about staff transfers and possibly savings, Area Managers and support staff numbers will remain the same, consequently there will be no cost savings and area management will be overlapping.
The agreement, we were told, budgetted for Rents to payed on 1st April and yet AA stated during the presentation the payment to Brains has already completed.
Marston's have stated the intention to sell a number of Freehold properties to fund Rental payments to Brains.
Meanwhile Brain's capital assets remain intact.
The agreement and processes can be further analysed , and will be.
Short-term investors may well see benefits initially, for LTH concern must be the clear direction of travel the company is embarked. Selling assets to pay rent and reduce debt , long term is going to diminsh capital value which many investors will want to see.
AIMO
GLA
Joe do not let sentiment cloud your judgement. Going against the sector's movement after the analsyts presentation makes you think??
Share price seems to be stalling while other pub stocks are rising. Has this hit a ceiling I wonder? Will it still be lucrative when everything reopens next month?