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6 breweries for a lager factory and a minority stake at that. Call that a rabbit out of a hat ? Clearly its a pig in a poke.
restrictions on numbers, no max limit of 30.
• The Joint Venture will have a dividend policy the aim of which will be to distribute, annually,
at least an amount equal to 90 per cent of the Joint Venture’s free cash flow to equity (subject
to applicable law and the ability of the directors to adjust dividend payments in the ordinary
10 Adjusted standalone run-rate EBITDA of £21.1 million for Carlsberg UK
• In the period to 31 December 2022, up to £20 million of restructuring costs will be excluded
from the calculation of free cash flow to equity in order to support the dividend payment to
• CMBC’s operational gross debt may not be incurred above 2x EBITDA without Marston’s
consent, except for in limited circumstances (including to support a dividend to Marston’s
where there has been expenditure outside the business plan).
The JV rns link on LSE doesn't work so put above from website. Although the JV will pay out to the two parties it is then up to Marstons to consider a dividend or not
I doubt there will be a rights issue-they occur in good times. The Tempus article said no more cash needed so hope that is right. The interims stated debt was being reduced with JV proceeds They also state: An interim dividend has not been proposed for the current period.
There does appear to be one snippet of decent news tucked away in Mars figures this week and that is their pension defecit has dropped from £36.4mill at year end last year to 3.9mill this year.
This is largely due to interest/discount rate changes but I can not recall anyone drawing attention to it before, and it is a significant positive.
Not that it has done the bulls much good so far but isworth bearing in mind
Fairdeáler20 thanks for your post. In other words we dan expect a deeply discounted rights issue.
The problem with reopening pubs is they have so many fixed costs and even when they wrre packed out, some were struggling. On top of that we have to appreciate, this year the festive season is goung to ge very poor as it always is during a recession. Add to that the fact we have to socially distance, it tells you the SP of the new shares will also plunge.
At the end of the last financial year debts of c£1.3billion, interim just announce show loss for 1/2 year of £40m, Banks approved a £70m additonal facilty for 180 days. Banks have deferred Loan repayments until 31st March 2021, Note holders have agreed technical waivers . Net income for current half year is likely to be not pretty.
If I have missed something will someone please correct?
On the positive side Carlsberg will pay in Q3 £239m.
The JV will not provide tangible benefits until year 3, in the mean time Marstons have got to at least tick over and deal with the unknowns following Covid 19.
Along with most other Brewers/Hospitality businesses, who are taking a prudent attitude towards protecting the balance sheets, it would be wise to raise funding and further reduce borrowings.
Do we think there is going to be one?
it's a bit like trying to predict the possibilty of CV19 taking-off again. The fluidity within markets currently it is impossible to say with any level of certainty where share prices will be even day after day.. Anyone who claims to predict where this or any share price will be , are just guessing.
Make up your own mind and stick with it.
anyone think that the sp will go down even further next week or do we think it will go back up hopefully.
because i dont know whether i want to invest in some more shares as they are to cheap not to say yes to or just wait and see what happenes next week.
I’m a long time long term investor. This will be a bumpy ride but if you’re willing to hold you will get the massive upturn benefit from March 23rd next year, due to the obvious closures this year and improvements against like for likes.
I’ll be honest, probably like all of you I was expecting a bit of an upturn this week but now I’m actually happy to hold for the medium term. I did have the fear early June that the price already reflected the reopening price. And I was right. But it will return. Give it time. But obviously do your own research.
In at this level only 40,000 shares but hopefully hit 80p in a few weeks
Interesting comparisons between various brewers etc. Management of debt will be a fundamental issue for many business.
MAB has a relatively modest debt to revenue ratio and significant assets ( over £4billion) which relates to 450p NAV, SP currently under 200p, so well supported.
MARS after reciept from Carlsberg will have a residual debt to gross income of over 100% and NAV of 74p.
MARS will come through given the likehood of a Rights Issue which are popular within the sector currently. and further relieve the debt pile which has for too long acted as a Millstone.
It is strange Tempus has not made more of the asset backing of Company's being promoted.
It is an illusion to believe things will be the same once everything opens up , there are significant headwinds to come.
The Restaurant Group
Andy Hornby is in firefighting mode at the casual dining group, exiting most of the Chiquito chain via an administration, deploying a company voluntary arrangement to shed 125 mainly Frankie & Benny’s outlets and raising £57 million of new equity. Refocusing the business on the excellent Wagamama and Brunning & Price brands is sensible, but the road to success is still long and painful. Avoid
It was all going so well. Yet only a year since it floated at 200p a share, the operator of the Lounge and Cosy Club café-bars is languishing at 127p. However, this is a business that is constantly evolving to stay relevant, while its value-for-money proposition should resonate with a post-Covid audience. Its recent £8.3 million share placing provides an extra buffer. Buy
Mitchells & Butlers
One of the few pub groups not to issue shares, but with a well-invested estate and no apparent desire for acquisitions, the £100 million loan secured should provide all the liquidity it needs. Hold
Another pub company to sidestep an equity raise, although it didn’t need one. Instead, Ralph Findlay, chief executive, formed a £780 million joint venture with Carlsberg, collecting £273 million of cash to reduce debt. Pulling this rabbit out of his hat doubled the share price, but it could have further to go. Buy
Debt and a £141 million equity raising gives Tim Martin, the pub group’s founder and chairman, the liquidity he needs, while Wetherspoons is ahead of the curve in ensuring its pubs are “Covid secure” come July 4. Expect him to cut prices to coax customers back through the door, although generating the level of sales necessary to make a decent margin could prove a short-term challenge. Avoid
City Pub Group
A solid start to 2020 was halted by the lockdown, but chairman Clive Watson has been through a few downturns and has acted decisively to cut the cost base. Although rents remain a concern, this is a quality company and a £22 million equity raising has enabled him to cut its bank borrowings by two-thirds. Buy
Lockdown came just as Rob Pitcher, the chief executive, was starting to sort out this problem child. A £15 million share placing eased the financial pressure, although this was at a cost of a 42 per cent discount owing to the scale of the issue compared to its £17 million market value. The Covid-19 pandemic threatens to halt the momentum. Avoid
Having handed £2.5 billion to shareholders after the £3.9 billion sale of Costa Coffee to Coca-Cola, Alison Brittain, chief executive of the Premier Inn and Beefeater owner, has reclaimed £1 billion via a rights issue. It may sound bizarre, but it’s a pragmatic move that will ensure the FTSE 100 group emerges as strongly as any company from the crisis and in prime position to take advantage of growth opportunities. Buy
hings change quickly in hospitality. Yesterday’s £88.4 million equity raising by Young’s came only six weeks after the pub company’s boss said that it would not need to bolster its finances during the lockdown by selling new shares. Patrick Dardis, 61, the Young’s chief executive, said the group had considered following some peers in raising new equity, but rejected the idea. “Debt is still cheap, so we decided not to go down that route.”The capital raising came despite his insistence that the scale of the liquidity available to Young’s meant it could cope with a “worst-case scenario, taking us through until pretty much this time next year”.Young’s, which began as a brewer in Wandsworth, south London, issued new shares equivalent to 19.2 per cent of its current share capital at a discount of about 10 per cent. Retail investors were able to participate, buying £2.7 million of stock through the Primary Bid platform.
The group plans to reopen all its pubs between July 13 and July 20 and said the new funds would enable it to kickstart investment in its pub estate, strengthen its balance sheet and “pursue opportunistic acquisitions”.This investment opportunity appears to be the key to Mr Dardis’s change of mind. While there is little doubt he could have kept Young’s afloat for 12 months, the restrictions inherent in relying on government-backed loans would have taken growth off the menu. Raising money from the market gives him the flexibility to invest in new and existing pubs. As one analyst put it: “There are two options: you either grow your way out of the crisis through the topline or grind your way out through the bottom line.”
I am a online member of the Time, I will put the article here
I saw the Tempus review late last night and thought it backed up my reasons for remaining top heavy in Marstons and light on JDW and MAB, bet he’s all to familiar with shares dropping the day after he tips them :-) after the 100% rise I thought about rebalancing but MARS has a great balance with supermarket sales whereas JDW is pub based only and a high volume low margin model - they need lots of customers. MAB is similar. Good weekend all and DYOR.
Tempus today said buy, he reviewd several brewers and pubs
All dependant on virus progress but potentially as you say. Stagflation should be good for Mars; high inflation/low growth/low interest rate-will help pay off debt but beer prices rise and local hostelry remains popular.
Youngs placing also, i just think things like this will be much higher eventually
you trying to break the backbone of the uk by stopping socialising in pubs, will never happen.
- Retain 40% stake in a high quality beer business with significant synergy opportunity
- Receive up to £273 million equalisation payment - valuing MBC at £580 million
- Proceeds used to further reduce debt, target ongoing cash flow broadly cash neutral
- Transaction approved by shareholders 25 June and expected to complete in Q3 2020, subject to competition clearance
· Well placed for post COVID-19 recovery in medium term
- Plans in place for pubs to reopen from 4 July, initial revenue and earnings profile uncertain
- Transaction significantly strengthens balance sheet
- Predominantly freehold pub estate, located outside city centres with 90% having outside space
- Well placed to benefit from likely supply contraction in sector and gain market share
- Management will have total future focus on operating its pubs and accommodation business
- Capital markets day in autumn to present pub strategy
Sound all fine to me - it will be like the Beaches - everyone will go anyway - and this will all be over soon like a bad dream
took some at 59 for a trade
this will rise on or before July 4th
Was about the price of a pint of Banks biter when I turned 18
I wouldn't sell anywhere near the current level for this stock. It may take a while but in the long term they will recover despite all the doom and gloom people are projecting with lower sales and customer experiences etc. I admit the near term could be really choppy but I'd like to think in the long term this is one you wouldn't want to miss out on. This is obviously all in my humble opinion and you should always do your own research. For the record I've just topped up now that we are below 60p as to me this is a real bargain and hasn't been near this level since a month ago on the day the merger was announced.