2015 - Charles Wells announces steady progress with turnover and operating profit up
Charles Wells has announced an increase of 4% in operating profit before exceptional costs alongside a steady programme of investment in its assets.
The Bedford based brewer and pub operator recorded an operating profit of £8m in its annual accounts for the year to September 2015, attributed to steady sales margins and strong cost control across the group. Turnover rose by £1.7m to £188.9m in the same period whilst total borrowings were reduced from £51.2m to £49.8m.
Investment of over £3m has been committed to improvements within the brewery including replacement of the Brewhouse control system and £2.5m was spent on the UK tenanted & leased estate within an overall refurbishment budget of £4m. Charles Wells also expanded its managed house portfolio with four sites now in its Apostrophe pubs division.
An ongoing focus on property development and licensee support contributed to an improvement in licensee retention rates with 96% of recent appointments still being in place after 18 months and 84% after 36 months, up 4% on last year.
Announcing the results, CEO Justin Phillimore said “The year has been one of steady progress in many areas. Beer sales volume increased and in retailing we invested in new pub developments to good effect.
“Improved sales were driven by new products and marketing promotions, with Young’s London Stout and Estrella Damm demonstrating particularly effective marketing and vigorous sales. Outside the UK volumes were impacted by a number of factors, including the weakening Euro and further sanctions in Russia, yet we retained our proportion of sales outside the UK at 17% of total sales.
He continued “Equally, our French pubs weathered the economic downturn in France and ongoing negotiations enabled us to purchase two pubs subsequent to the year end, bringing our total to 13 sites. Our new concept, the English Country Kitchen, has been building a reputation in the blossoming tea room market and is recording a good level of turnover.”
“We have had many challenges” concluded Justin Phillimore “and consumer confidence still seems to be recovering but we have made great progress and our plans will continue to deliver results in 2016. I am confident that the hard work and commitment of everyone at Charles Wells will drive development of our beer brand and pub portfolio even further, ensuring that the consumer remains at the heart of everything we do.”
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Download the Charles Wells Annual Review 2015 final version
2014 - Charles Wells announces strong performance in operating profit and continues investment programme to secure future growth
Charles Wells Ltd has announced its annual results for the financial year to 27th September 2014, incorporating the performance of Wells & Young’s Brewing Company, Charles Wells Pub Company and John Bull Pub Company.
Sales income rose £5m to £187m with profit after tax of £7.7m – up 24% from £6.2m the previous year. EBITDA was up 6% to £14.7m.
Sales of own beers have been growing steadily as the heightened consumer interest in craft beer stimulated the beer market. The introduction of several new beers to match this demand, including Charles Wells DNA and Young’s London Stout, has proved successful at home and abroad. The strategy of seeking growth in international markets continues apace and at the end of the financial year, these markets represented 17% of the brewery’s output. The wine company, Cockburn & Campbell, enjoyed its third consecutive year of growth with sales up 16%.
Whilst no new pubs were acquired in the UK during the year there has been an ongoing commitment to invest strongly in the estate, with more than £2.4m being spent on the leased and tenanted estate, an average of £12,000 per pub. 2014 also saw Charles Wells return to managed houses in the UK with £1.5m being invested in the first Apostrophe Pub, the d’Parys in Bedford. A continued focus on improving the long term sustainability of the pub estate saw 5 smaller and unviable sites being sold, generating £1.1m of sales proceeds.
The John Bull managed house operations in France performed strongly despite the weakening economic conditions in Europe. With nine sites operating throughout the year focus has been on identifying future sites for expansion within France. A tenth site opened in Bordeaux in September and an 11th site has also been identified for early 2015.
Debt levels of the Group are in line with expectations with the £6m increase in borrowings reflecting the final £5m payment to Young’s for the purchase of their 40% share in Wells & Young’s and the return to UK managed houses.
Commenting on the results Paul Wells, Chairman of Charles Wells Ltd, said “Our performance this year has been in line with expectations and we have invested for the future through investment in the brewery as well as the pub estates in the UK and France. Our international sales and pub operations have demonstrated that growth is possible at home and overseas, despite the difficulties of the global economy and our wine company has also delivered excellent growth. Consumer tastes continue to develop and therefore innovative new products along with quality pub sites that consumers wish to frequent is essential.
“Our tax obligation remains high, with 42% of turnover paid in tax in addition to VAT payments of £17.9m. However a second consecutive cut in duty of 1p per pint in the budget helped to ensure continued investment in high quality pubs.”
Looking ahead to 2015, Paul Wells added “The board is delighted to announce that Bob Ivell will join as a non-executive director of Charles Wells in January 2015 and we are confident and optimistic about the future as we move forward with our brewing and pub businesses which transfer back under the name of Charles Wells next month.”
Download the Charles Wells Annual Review 2014
2013 – Charles Wells reduces debt in year of steady progress
In annual results for the financial year to 28th September 2013, Charles Wells Ltd has announced a year of steady progress and a significant reduction in its debt.
The results incorporate the performance of individual trading sectors of the business including Wells & Young’s Brewing Company, Charles Wells Pub Company and John Bull Pub Company.
With a stated aim of bringing the total level of debt down in 2013, borrowings at the end of the year were £44.7m, a reduction of £18.8m on the previous year. This was driven by the sale of its distribution depot in Bedford and the company divesting Kestrel Super Strength beer, a non-core brand, from its UK portfolio at the start of the financial year.
Trading performance showed a fall in sales income of £7.9m to £181.6m and operating profit before exceptional costs was £0.4m lower than last year at £6.2m. This decrease was anticipated because of the loss of third-party brewing contracts and the sale of Kestrel but was, in part, offset by the exceptional income from the sale. Profit after tax was up 8% and adjusted EBITDA for the Group fell 20% to £13.9m.
Wells & Young’s sales fell £8m to £161.9m, reflecting the sale of Kestrel which had contributed sales of £8.7m the previous year. The decision to sell was in line with the business’s strategic plan to reduce exposure to the super-strength lager market and develop a clearly defined portfolio which saw a number of new product launches including Wells DNA and McEwan’s Red.
An outstanding balance to Young & Co’s Brewery plc of £5m remains for the purchase of the Wells & Young’s Brewing co Ltd shares and will be paid in February 2014.
Although focus has been maintained on core overseas distribution, international sales have also expanded into a number of emerging markets and the Cockburn & Campbell wines and spirits business recorded gross profit growth of 12%.
Sales for Charles Wells Pub Company were down 3.5% in a year that had seen a 4.6% reduction in the average trading estate to 203 houses. Whilst 18 smaller and unviable sites were sold, the Company continues to invest in pubs and spent £3m on property refurbishments with EBITDA per pub rising 3.4%.
In France, the John Bull managed estate opened its ninth pub, with house net profit rising 13.5% and EBITDA close to breaking through the €1m mark.
Commenting on the results Paul Wells, Chairman of Charles Wells Ltd, said “We can report a year of steady progress with financial results being better than forecast at last year’s Annual General Meeting. Net profit before tax for the year grew slightly and overall trading has been better than expected, with good summer weather, new initiatives and new markets all key features in growing sales.
“Whilst exceptional items such as restructuring following the loss of brewing contracts and the sale of Kestrel have impacted on the headline figures, we have worked hard to mitigate these losses and have some further exciting new initiatives planned for 2014. Careful control of costs, including a 17% reduction in administration overheads by Charles Wells Pub Company, has helped protect our financial position and reduction of debt ensures we’re well positioned to grow the business.
“Our tax obligation remains high, with the percentage of tax paid in relation to turnover rising to 44%. However, the cancellation of the duty escalator and cut in duty of 1p per pint helps to ensure that we will continue to invest in high quality pubs in the UK. Our brand portfolio includes an unrivalled mixture of traditional and imaginative beers and we look forward to strengthening our reputation by bringing interesting new beers to market in 2014.”
2012 – A good year in difficult conditions
Charles Wells Ltd has announced its annual results for the financial year to 29th September 2012, incorporating the performance of Wells & Young’s Brewing Company, Charles Wells Pub Company and John Bull Pub Company…. (Read More)