Earnings fall at Enterprise Inns

SOLIHULL-based pubco Enterprise Inns has seen a drop in EBITDA of £41m for the full year, it announced today.

The plc, which operates leased and tenanted pubs, said EBITDA had dropped year-on-year from £405m to £366m for the 12 months ended September 30, 2011.

Pre-tax profit was down from £175m to £157m and profit after tax was £24m, down from £26m.

Average net income per pub was up only slightly by 1% to £64,200 and like-for-like net income in the substantive estate was down 1.7 % on 2010’s figures.

It said it generated £238m proceeds from disposals and a sale and leaseback programme and had seen a drop in book value of its pub estate of £173m. Net debt has been reduced by £302m to £3bn.

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Chief executive Ted Tuppen said: “At the start of the year, we set ourselves the task of stabilising the operational performance of the business whilst continuing to reduce our exposure to the banking market.

“We have made good progress on both fronts. The performance of our substantive estate, which makes up 90% of our estate by number, 95% by income, has continued to improve and we have reduced net debt by £302m.

“Strong cash flows from disposals and operating activities have helped to significantly reduce bank borrowings during the year and we will continue to reduce our exposure to the volatility of the banking market by bringing forward a review of our existing banking facilities to secure appropriate bank funding for the future.

“In addition, we are reviewing how we can ensure that the income potential from every outlet is maximised including identification of additional opportunities to realise proceeds in excess of book value through disposal or alternative use, where appropriate.

“We remain committed to our initiatives and our strategy and confident that in the medium term we will be in a good position to deliver positive returns to shareholders.”