TIDMJDW
RNS Number : 0679A
Wetherspoon (JD) PLC
14 March 2013
15 March 2013 PRESS RELEASE
J D WETHERSPOON PLC
INTERIM RESULTS
(For the 26 weeks ended 27 January 2013)
FINANCIAL HIGHLIGHTS
Revenue GBP626.4m (2012: GBP569.4m) +10.0%
Like-for-like sales +6.9%
Operating profit GBP52.1m (2012: GBP53.1m) -2.0%
Profit before tax & exceptional items GBP34.8m
(2012: GBP35.8m) -2.7%
Earnings per share 20.8p (2012: 20.2p) +3.0%
Interim dividend 4.0p (2012: 4.0p) Maintained
Commenting on the results, Tim Martin, the Chairman of J D
Wetherspoon plc, said:
"The outcome for the first half of the financial year was
reasonable, given the pressures on the UK consumer.
As previously stated, the biggest danger to the pub industry, is
the VAT disparity between supermarkets and pubs and the continuing
imposition of stealth taxes, such as the late-night levy, and the
increase in fruit/slot machine taxes.
In the six weeks to 10 March 2013, like-for-like sales increased
by 7.3%, with total sales increasing by 9.9%.
Taxation and input costs will continue to rise, but, overall,
the company continues to aim for a reasonable outcome in the
current financial year."
Enquiries:
John Hutson Chief Executive Officer 01923 477777
Kirk Davis Finance Director 01923 477777
Eddie Gershon Company spokesman 07956 392234
Photographs are available at: www.newscast.co.uk
Notes to editors
1. JD Wetherspoon owns and operates pubs throughout the UK. The
Company aims to provide customers with good-quality food and drink,
served by well-trained and friendly staff, at reasonable prices.
The pubs are individually designed and the Company aims to maintain
them in excellent condition.
2. Visit our website www.jdwetherspoon.co.uk
3. This announcement has been prepared solely to provide
additional information to the shareholders of JD Wetherspoon, in
order to meet the requirements of the UK Listing Authority's
Disclosure and Transparency Rules. It should not be relied on by
any other party, for other purposes. Forward-looking statements
have been made by the directors in good faith using information
available up until the date that they approved this statement.
Forward-looking statements should be regarded with caution because
of inherent uncertainties in economic trends and business
risks.
4. The next Interim Management Statement will be issued on 8 May 2013
CHAIRMAN'S STATEMENT AND OPERATING REVIEW
In the 26 weeks ended 27 January 2013, like-for-like sales
increased by 6.9%, with total sales, including new pubs, increasing
by 10.0% to GBP626.4 million (2012: GBP569.4 million).
Like-for-like bar sales increased by 4.1% (2012: 3.4%),
like-for-like food sales were up 13.4% (2012: 0.1%) and machine
sales increased by 4.4% (2012: decreased by 3.8%).
Operating profit before exceptional items decreased by 2.0% to
GBP52.1 million (2012: GBP53.1 million) and after exceptional items
increased by 3.1% to GBP52.1 million (2012: GBP50.5 million). The
operating margin before exceptional items was lower, at 8.3% (2012:
9.3%). As previously highlighted, there was considerable inflation
in costs during the period. The largest increase was GBP23.4
million in taxation, with further increases in labour costs,
utilities and bar and food supplies. The operating margin after
exceptional items was 8.3% (2012: 8.9%).
Profit before tax and exceptional items decreased by 2.7% to
GBP34.8 million (2012: GBP35.8 million) and after exceptional items
increased by 4.9% to GBP34.8 million (2012: GBP33.2 million).
Earnings per share before exceptional items increased by 3.0% to
20.8p (2012: 20.2p), despite the fall in adjusted earnings, owing
to fewer shares in issue and a reduced corporation tax charge.
Basic earnings per share after exceptional items increased by 13.7%
to 20.8p (2012: 18.3p).
As illustrated in the table in the tax section below, the
company paid taxes of GBP273.5 million in the period under review,
43.7% of sales, compared with GBP250.1 million in the same period
last year - 43.9% of sales. Taxes amounted to a multiple of 10.9
times profit after tax, compared with 10.7 times last year.
Net interest was covered 3.0 times by operating profit before
exceptional items (2012: 3.1 times). There were no exceptional
items in the period under review (2012: GBP2.6 million). Total
capital investment was GBP36.3 million in the period (2012: GBP60.5
million), with GBP19.1 million on new pub openings (2012: GBP41.7
million) and GBP17.2 million on existing pubs (2012: GBP18.8
million).
Free cash flow, after capital investment of GBP17.2 million in
existing pubs and payments of tax and interest, decreased to
GBP22.6 million (2012: GBP34.9 million), owing primarily to an
expected reversal of a working capital benefit of approximately
GBP15.0 million at the previous year end. Free cash flow per share
was 18.7p (2012: 27.5p).
Dividends
The board declared an interim dividend of 4.0p per share for the
current interim financial period ending 27 January 2013 (2012: 4.0p
per share). The interim dividend will be paid on 30 May 2013 to
those shareholders on the register at 3 May 2013. The dividend was
covered 5.2 times by profit.
Corporation tax
We expect the overall corporation tax charge for the financial
year, including current and deferred taxation, to reduce to
approximately 27.7% before exceptional items (July 2012: 28.5%
before exceptional items and after excluding the effect of the
tax-rate change). This is due to a reduction in the UK standard
weighted average tax rate for the period of 1.7% to 23.7%. As in
previous years, the company's tax rate is higher than the standard
UK tax rate, owing mainly to depreciation which is not eligible for
tax relief.
Financing
As at 27 January 2013, the company's net bank borrowings
(including finance leases) were GBP469.9 million, an increase of
GBP7.3 million, compared with those of the previous year end (29
July 2012: GBP462.6 million). Our net-debt-to-EBITDA ratio was 2.99
times at the period end, in line with the financial year end.
Property
In the period, we opened five new pubs, bringing the number of
pubs open at the period's end to 865. We now expect to open around
30 pubs in this financial year.
Also in the period, Wetherspoon agreed on an out-of-court
settlement with developer Anthony Lyons, formerly of property
leisure agent Davis Coffer Lyons. Wetherspoon will receive
approximately GBP1.25 million from Mr Lyons.
The payment relates to litigation in which Wetherspoon claimed
that Mr Lyons had been an accessory to frauds committed by
Wetherspoon's former retained agent Van de Berg and its directors
Christian Braun, George Aldridge and Richard Harvey. Mr Lyons
denied the claim and the litigation was contested.
The claim related to properties in Portsmouth, Leytonstone and
Newbury. The Portsmouth property was involved in the 2008/9 Van de
Berg case itself. In that case, Mr Justice Peter Smith found that
Van de Berg, but not Mr Lyons, who was not a party to the case,
fraudulently diverted the freehold from Wetherspoon to Moorstown
Properties Limited, a company owned by Simon Conway. Moorstown
leased the premises to Wetherspoon. Wetherspoon is still a
leaseholder of this property - a pub called The Isambard Kingdom
Brunel.
The properties in Leytonstone and Newbury (the other properties
in the case against Mr Lyons) were not pleaded in the 2008/9 Van de
Berg case. Leytonstone was leased to Wetherspoon and trades today
as The Walnut Tree public house. Newbury was leased to Pelican plc
and became a Café Rouge.
In the last financial year, Wetherspoon also agreed on a
settlement with Paul Ferrari, of London estate agent, Ferrari, Dewe
& Co, in respect of properties referred to as the 'Ferrari
Five' by Mr Justice Peter Smith, in the Van de Berg case.
Taxes and regulation
The company paid total taxes of GBP273.5 million in the
six-month period, a GBP23.4 million increase on the previous year.
If we were taxed on the same basis as supermarkets, we would have
paid GBP40.7 million less, since supermarkets pay virtually no VAT
in respect of food sales.
We believe there to be an overwhelmingly strong case for tax
parity between pubs and supermarkets, since lower supermarket taxes
help them to sell alcoholic drinks at extremely low prices,
compared with those of pubs.
The government and medical profession hope to combat low
supermarket prices by 'minimum pricing' legislation. However, if
the government were to use the tax system to encourage, rather than
discourage, consumption in pubs, it would greatly increase the
average price per unit of alcohol paid by consumers, helping to
meet government and medical health objectives, while increasing
employment and tax revenues at the same time.
At the current time, approximately 50% of beer is consumed in
pubs, and 50% in the 'off-trade'. For illustrative purposes, if the
average price of a pint from a supermarket is GBP1 and that of a
pint in a pub GBP3, increasing the number of pub pints from 50% to
75% would increase the average price paid in the country as a whole
from about GBP2 to GBP2.50. Instead, successive governments have
'cracked down' on pubs by increasing taxes and regulations,
resulting in on-trade consumption of beer dropping from about 90%
to about 50% in the last 30 years and, perversely, reducing the
average price per pint paid by consumers.
As well as paying far higher taxes per pint or per meal than
supermarkets, pubs generate far more jobs. The campaign by the 'VAT
Club', headed by respected restaurateur Jacques Borel (supported
by: Heineken; the family brewers such as Young's and Fuller's;
Wetherspoon; many others), has comprehensively explained the
financial and employment benefits for the economy of tax parity
with supermarkets.
2013 2012
First First
half half
GBPm GBPm
VAT 126.1 115.6
Alcohol duty 74.6 65.6
PAYE and NIC 34.7 32.8
Business rates 23.4 21.0
Corporation tax 8.6 9.0
Machine duty 1.8 1.6
Fuel duty 1.0 1.3
Carbon tax 1.3 1.2
Climate change levy 0.8 0.6
Stamp duty 0.3 0.6
Landfill tax 0.6 0.6
Premise licence and
TV licences 0.3 0.2
------------------------ ------- -------
TOTAL TAX 273.5 250.1
------------------------ ------- -------
TAX AS % OF SALES 43.7% 43.9%
------------------------ ------- -------
PROFIT AFTER TAX (PAT) 25.2 23.3
------------------------ ------- -------
PAT AS % OF SALES 4.0% 4.1%
------------------------ ------- -------
Further progress
As in the past, the company has endeavoured to improve as many
areas of the business as possible. For example, we have introduced
a system for faster credit card payments, as well as contactless
payment.
We have continued our heavy investment in the business, having
spent GBP22.8 million on repairs (2012: GBP20.1 million) and
GBP17.2 million on refurbishments and improvements (2012: GBP18.8
million).
We have continued to make significant investments in training
programmes and also paid GBP13.0 million (2012: GBP10.9 million) in
bonuses and free shares to employees, 99% of which was paid to
those below board level and 88% paid to those working in our
pubs.
Once again, the company has received a record number of
recommendations in CAMRA's Good Beer Guide. We were also named 'the
nation's favourite pub brand' at the Eat Out Magazine Awards, in
London, in January 2013. As regards hygiene, the company has
received an average score of 4.8 out of 5, in respect of the
local-authority-run scheme Scores on the Doors. We believe this to
be higher than any other substantial pub company, including
well-run competitors.
Current trading and outlook
The outcome for the first half of the financial year was
reasonable, given the pressures on the UK consumer.
The biggest danger to the pub industry, as indicated above and
previously, is the VAT disparity between supermarkets and pubs and
the continuing imposition of stealth taxes, such as the late-night
levy, and the increase in fruit/slot machine taxes.
In the six weeks to 10 March 2013, like-for-like sales increased
by 7.3%, with total sales increasing by 9.9%.
As previously indicated, taxation and input costs will continue
to rise, but, overall, the company continues to aim for a
reasonable outcome in the current financial year.
INCOME STATEMENT for the 26 weeks ended 27 January 2013
Notes Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
------------------------------------- --------- ------------ ------------ ------------
Revenue 4 626,397 569,375 1,197,129
Operating costs (574,321) (516,259) (1,089,811)
------------------------------------- --------- ------------ ------------ ------------
Operating profit before exceptional
items 6 52,076 53,116 107,318
Exceptional items 5 - (2,599) (13,481)
Operating profit 52,076 50,517 93,837
Finance income 61 27 55
Finance costs (17,300) (17,334) (35,010)
Profit before tax 34,837 33,210 58,882
Income tax expense 7 (9,636) (9,926) (14,315)
Profit for the period 25,201 23,284 44,567
------------------------------------- --------- ------------ ------------ ------------
Basic earnings per share 8 20.8 18.3 35.6
STATEMENT OF COMPREHENSIVE INCOME for the 26 weeks ended 27
January 2013
Notes Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
---------------------------------- ------ ------------ ------------ ----------
Interest-rate swaps: gain/(loss)
taken to equity 13 9,274 (6,638) (8,149)
Tax on items taken directly
to equity (2,133) 1,660 717
---------------------------------- ------ ------------ ------------ ----------
Net gain/(loss) recognised
directly in equity 7,141 (4,978) (7,432)
Profit for the period 25,201 23,284 44,567
---------------------------------- ------ ------------ ------------ ----------
Total comprehensive income
for the period 32,342 18,306 37,135
---------------------------------- ------ ------------ ------------ ----------
CASH FLOW STATEMENT for the 26 weeks ended 27 January 2013
Notes Unaudited Unaudited Unaudited Unaudited Audited Audited
26 weeks 26 weeks 26 weeks 26 weeks 53 weeks 53 weeks
ended ended ended ended ended ended
27 January 27 January 22 January 22 January 29 July 29 July
2013 2013 2012 2012 2012 2012
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Cash flows from operating
activities
Cash generated from operations 9 64,360 64,360 79,173 79,173 196,733 196,733
Interest received 62 62 17 17 49 49
Interest paid (15,398) (15,398) (16,478) (16,478) (36,091) (36,091)
Corporation tax paid (8,615) (8,615) (8,968) (8,968) (18,168) (18,168)
Purchase of own shares for
share-based payments (628) (628) - - (5,756) (5,756)
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Net cash inflow from operating
activities 39,781 39,781 53,744 53,744 136,767 136,767
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Cash flows from investing
activities
Purchase of property, plant
and equipment (14,905) (14,905) (14,986) (14,986) (36,578) (36,578)
Purchase of intangible assets (2,293) (2,293) (3,838) (3,838) (8,647) (8,647)
Purchase of lease premiums (21) - (489) -
Proceeds of sale of property,
plant and equipment - 250 887 -
Investment in new pubs and
pub extensions (19,033) (41,666) (74,859) -
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Net cash outflow from investing
activities (36,252) (17,198) (60,240) (18,824) (119,686) (45,225)
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Cash flows from financing
activities
Equity dividends paid 14 (10,021) (10,475) (15,544)
Proceeds from issue of ordinary
shares - 46 95
Purchase of own shares - - (22,711)
Advances under bank loans 13 7,509 18,199 18,059
Advances under finance leases - - 10,474
Finance costs on new loan 13 - (2,711) (2,731)
Finance lease principal
payments 13 (2,921) (2,038) (4,373)
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Net cash (outflow)/inflow
from financing activities (5,433) 3,021 (16,731)
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Net change in cash and cash
equivalents 13 (1,904) (3,475) 350
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Opening cash and cash equivalents 28,040 27,690 27,690
Closing cash and cash equivalents 26,136 24,215 28,040
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Free cash flow 22,583 34,920 91,542
---------------------------------- ----- ----------- ----------- ----------- ----------- --------- ---------
Free cash flow per ordinary
share 8 18.7p 27.5p 73.2p
BALANCE SHEET as at 27 January 2013
Notes Unaudited Unaudited Audited
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
---------------------------------- ------ ------------ ------------ ----------
Assets
Non-current assets
Property, plant and equipment 10 932,063 907,800 924,341
Intangible assets 11 17,995 12,908 16,936
Deferred tax assets 14,073 17,229 16,198
Other non-current assets 12 10,537 10,350 10,682
Total non-current assets 974,668 948,287 968,157
Current assets
Inventories 20,655 20,282 20,975
Other receivables 26,866 25,597 18,685
Assets held for sale 2,076 145 2,055
Cash and cash equivalents 13 26,136 24,215 28,040
Total current assets 75,733 70,239 69,755
Total assets 1,050,401 1,018,526 1,037,912
---------------------------------- ------ ------------ ------------ ----------
Liabilities
Current liabilities
Trade and other payables (197,094) (185,143) (207,114)
Financial liabilities due
in one year 13 (5,660) (3,545) (5,880)
Current income tax liabilities (9,845) (10,505) (9,103)
Total current liabilities (212,599) (199,193) (222,097)
Non-current liabilities
Financial liabilities (490,406) (477,300) (484,771)
Derivative financial instruments 13 (56,755) (64,518) (66,029)
Deferred tax liabilities (68,147) (71,358) (67,860)
Provisions and other liabilities (28,621) (25,067) (27,511)
---------------------------------- ------ ------------ ------------ ----------
Total non-current liabilities (643,929) (638,243) (646,171)
Net assets 193,873 181,090 169,644
---------------------------------- ------ ------------ ------------ ----------
Shareholders' equity
Ordinary shares 15 2,521 2,632 2,521
Share premium account 143,294 143,245 143,294
Capital redemption reserve 1,910 1,798 1,910
Hedging reserve (43,701) (48,388) (50,842)
Retained earnings 89,849 81,803 72,761
---------------------------------- ------ ------------ ------------ ----------
Total shareholders' equity 193,873 181,090 169,644
---------------------------------- ------ ------------ ------------ ----------
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Called-up Share Capital
share premium redemption Hedging Retained
capital account reserve reserve earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
----------------------------------- ---------- --------- ------------ ---------- ---------- ---------
At 24 July 2011 2,632 143,199 1,798 (43,410) 66,826 171,045
Profit for the period 23,284 23,284
Interest-rate swaps
- loss taken to equity (6,638) (6,638)
Tax on items taken directly
to equity 1,660 1,660
----------------------------------- ---------- --------- ------------ ---------- ---------- ---------
Total comprehensive (loss)/
income (4,978) 23,284 18,306
Exercise of options 46 46
Share-based payment charges 2,168 2,168
Dividends (10,475) (10,475)
At 22 January 2012 2,632 143,245 1,798 (48,388) 81,803 181,090
Profit for the period 21,283 21,283
Interest-rate swaps
- loss taken to equity (1,511) (1,511)
Tax on items taken directly
to equity (943) (943)
----------------------------------- ---------- --------- ------------ ---------- ---------- ---------
Total comprehensive (loss)/income (2,454) 21,283 18,829
Exercise of options 1 49 50
Repurchase of shares (112) 112 (22,598) (22,598)
Tax on repurchase of
shares (113) (113)
Share-based payment charges 3,211 3,211
Purchase of shares held
in trust (5,727) (5,727)
Tax on purchase of shares
held in trust (29) (29)
Dividends (5,069) (5,069)
At 29 July 2012 2,521 143,294 1,910 (50,842) 72,761 169,644
Profit for the period 25,201 25,201
Interest-rate swaps
- profit taken to equity 9,274 9,274
Tax on items taken directly
to equity (2,133) (2,133)
----------------------------------- ---------- --------- ------------ ---------- ---------- ---------
Total comprehensive (loss)/income 7,141 25,201 32,342
Share-based payment charges 2,536 2,536
Purchase of shares held
in trust (624) (624)
Tax on purchase of shares
held in trust (4) (4)
Dividends (10,021) (10,021)
At 27 January 2013 2,521 143,294 1,910 (43,701) 89,849 193,873
----------------------------------- ---------- --------- ------------ ---------- ---------- ---------
Notes
1. General information
J D Wetherspoon plc is a public limited company, incorporated
and domiciled in England and Wales. Its registered office address
is: Wetherspoon House, Central Park, Reeds Crescent, Watford, WD24
4QL
The company is listed on the London Stock Exchange.
This condensed half-yearly financial information was approved
for issue by the board on 15 March 2013.
This interim report does not comprise statutory accounts within
the meaning of Sections 434 and 435 of the Companies Act 2006.
Statutory accounts for the year ended 29 July 2012 were approved by
the board of directors on 14 September 2012 and delivered to the
Registrar of Companies. The report of the auditors, on those
accounts, was unqualified, did not contain an emphasis-of-matter
paragraph or any statement under Sections 498 to 502 of the
Companies Act 2006.
There are no changes to the principal risks and uncertainties as
set out in the financial statements for the 53 weeks ended 29 July
2012, which may affect the company's performance in the next six
months. The most significant risks and uncertainties relate to the
taxation on, and regulation of, the sale of alcohol, cost increases
and UK disposable consumer incomes. For a detailed discussion of
the risks and uncertainties facing the company, refer to the annual
report for 2012, pages 40 and 41.
2. Basis of preparation
This condensed half-yearly financial information of J D
Wetherspoon plc (the 'Company'), which is abridged and unaudited,
has been prepared in accordance with the Disclosure and
Transparency Rules of the Financial Services Authority and with
International Accounting Standards (IAS) 34, Interim Financial
Reporting, as adopted by the European Union. This interim report
should be read in conjunction with the annual financial statements
for the 53 weeks ended 29 July 2012 which were prepared in
accordance with IFRSs, as adopted by the European Union.
The directors have made enquiries into the adequacy of the
Company's financial resources, through a review of the Company's
budget and medium-term financial plan,including capital expenditure
plans and cash flow forecasts; they have satisfied themselves that
the Company will continue in operational existence for the
foreseeable future. For this reason, they continue to adopt the
going-concern basis in preparing the Company's financial
statements.
The financial information for the 53 weeks ended 29 July 2012 is
extracted from the statutory accounts of the Company for that
year.
The interim results for the 26 weeks ended 27 January 2013 and
the comparatives for 22 January 2012 are unaudited, but have been
reviewed by the independent auditors. A copy of the review report
is included at the end of this report.
3. Accounting policies
Taxes on income in the interim periods are accrued using the tax
rate which would be applicable to expected total annual
earnings.
With the exception of tax, the accounting policies adopted in
the preparation of the interim report are consistent with those
applied in the preparation of the Company's annual report for the
year ended 29 July 2012.
The following new standards, amendments to standards or
interpretations are mandatory for the first time for the financial
year beginning 30 July 2012, but are not relevant for the
Company:
-- Amendment to IAS12 'Income taxes' on deferred tax
-- Amendment to IAS 1 'Presentation of financial statements on other comprehensive income'
4. Revenue
Revenue disclosed in the income statement Unaudited Unaudited Audited
is analysed as follows: 26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
--------------------------------------------- ------------ ------------ ----------
Sales of food, beverages and machine income 626,397 569,375 1,197,129
--------------------------------------------- ------------ ------------ ----------
The Company trades in one business segment (that of operating
managed public houses) and one geographical segment (being the
United Kingdom).
5. Exceptional Items
Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
Operating items
Property impairment - - 7,823
Onerous lease provision - - 2,229
Restructuring costs - - 625
Loss on disposal of property, plant and
equipment - 666 1,062
Write-off of IT-related assets and other
software costs - 1,933 1,742
----------------------------------------- ----------- ----------- ---------
2,599 13,481
----------------------------------------- ----------- ----------- ---------
The IT related assets written off in the previous period relate
primarily to the development cost of software which was not
implemented.
6. Operating profit before exceptional items
This is stated after charging/(crediting): Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
----------------------------------------------- ------------ ------------ ----------
Concession rental payments 7,405 6,940 14,831
Operating lease payments 26,803 25,965 53,230
Repairs and maintenance 22,794 20,073 44,575
Rent receivable (259) (251) (540)
Depreciation of property, plant and equipment 24,273 23,010 47,416
Amortisation of intangible assets 1,234 620 1,423
Amortisation of non-current assets 166 159 327
Share-based payment charges 2,536 2,168 5,379
----------------------------------------------- ------------ ------------ ----------
7. Income tax expense
The taxation charge for the period ended 27 January 2013 is
based on the estimated effective tax rate for the year ending 28
July 2013 of 27.7% (2012: 28.5%, based on a pre-exceptional profit
before tax of GBP35.8m). This comprises a current tax rate of 26.9%
(2012: 28.7% pre-exceptional) and a deferred tax rate of 0.8%
(2012: -0.2% pre-exceptional). The UK standard weighted average tax
rate for the year is 23.7%. The current tax rate is higher than the
UK standard weighted average tax rate, owing mainly to depreciation
which is not eligible for tax relief.
Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
---------------------------------------------- ----------- ----------- ---------
Current tax 9,357 10,288 18,538
Current tax on exceptional items - intangible
asset write-off - (272) (723)
Deferred tax
Origination and reversal of temporary
differences 279 (90) 2,127
Impact of change in UK tax rate - (5,627)
Tax charge in the income statement 9,636 9,926 14,315
---------------------------------------------- ----------- ----------- ---------
8. Earnings and free cash flow per share
Basic earnings per share has been calculated by dividing the
profit attributable to equity holders of
GBP25,201,000 (January 2012: GBP23,284,000; July 2012:
GBP44,567,000) by the weighted average number of shares in issue
during the period of 120,890,250 (January 2012: 127,004,632; July
2012: 125,079,021).
The weighted average number of shares has been adjusted to
exclude shares held in respect of the employee Share Incentive
Plan.
Earnings before exceptional items per share has been calculated
before exceptional items detailed in note 5. There are no shares
remaining under option.
Adjusted earnings for the 53 weeks ended 29 July 2012 excludes
an adjustment of GBP5,627,000, in respect of the corporation
tax-rate change in that year.
Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
------------------------------------------------ ------------ ------------ ----------
Earnings (profit after tax) 25,201 23,284 44,567
Exclude one-off tax benefit (rate change) - - (5,627)
Adjusted earnings after exceptional items 25,201 23,284 38,940
Exclude effect of exceptional items net
of tax - 2,327 12,758
Adjusted earnings before exceptional
items 25,201 25,611 51,698
------------------------------------------------ ------------ ------------ ----------
Basic/diluted earnings per share 20.8p 18.3p 35.6p
Adjusted earnings per share before exceptional
items 20.8p 20.2p 41.3p
Adjusted earnings per share after exceptional
items 20.8p 18.3p 31.1p
Free cash flow per share
The calculation of free cash flow per share is based on the net
cash generated by business activities and available for investment
in new pub developments and extensions to current pubs, after
funding interest, tax, all other reinvestment in pubs open at the
start of the period and the purchase of own shares under the
employee share-based schemes ('free cash flow'). It is calculated
before taking account of proceeds from property disposals, inflows
and outflows of financing from outside sources and dividend
payments and is based on the same number of shares in issue as that
for the calculation of basic earnings per share.
9. Cash generated from operations
Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
------------------------------------------- ------------ ------------ ----------
Operating profit 52,076 50,517 93,212
Operating exceptional Items - 2,599 13,481
------------------------------------------- ------------ ------------ ----------
Operating profit before exceptional items 52,076 53,116 106,693
Depreciation and amortisation 25,673 23,789 49,166
Share-based payment charges 2,536 2,168 5,379
80,285 79,073 161,238
Change in inventories 320 1,207 514
Change in receivables (8,181) (3,677) 2,598
Change in payables (8,064) 2,570 32,383
------------------------------------------- ------------ ------------ ----------
Net cash inflow from operating activities 64,360 79,173 196,733
------------------------------------------- ------------ ------------ ----------
10. Property, plant and equipment
GBP000
------------------------------------------------ ----------
Net book amount at 24 July 2011 881,271
Additions 50,653
Disposals (1,114)
Depreciation (23,010)
------------------------------------------------ ----------
Net book amount at 22 January 2012 907,800
Additions 51,486
Disposals and transfer to assets held for sale (12,856)
Depreciation, impairment and other movements (22,089)
Net book amount at 29 July 2012 924,341
Additions 32,140
Disposals (145)
Depreciation (24,273)
------------------------------------------------ ----------
Net book amount at 27 January 2013 932,063
------------------------------------------------ ----------
11. Intangible assets
GBP000
---------------------------------------------- ---------
Net book amount at 24 July 2011 11,525
Additions 3,745
Write-off of IT-related assets (1,742)
Amortisation, impairment and other movements (620)
---------------------------------------------- ---------
Net book amount at 22 January 2012 12,908
Additions 4,902
Amortisation, impairment and other movements (874)
Net book amount at 29 July 2012 16,936
Additions 2,293
Amortisation, impairment and other movements (1,234)
---------------------------------------------- ---------
Net book amount at 27 January 2013 17,995
---------------------------------------------- ---------
Intangible assets all relate to computer software and
development.
12. Other non-current assets
Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
-------------------- ------------ ------------ ----------
Leasehold premiums 10,537 10,350 10,682
-------------------- ------------ ------------ ----------
13. Analysis of changes in net debt
Non-cash 27 January
29 July Cash flows movement 2013
2012 GBP000 GBP000 GBP000
GBP000
------------------------------ ---------- ------------- ---------- -----------
Cash at bank 28,040 (1,904) - 26,136
Debt due after one year (474,559) (7,509) (827) (482,895)
(446,519) (9,413) (827) (456,759)
Finance lease creditor (16,092) 2,921 - (13,171)
------------------------------ ---------- ------------- ---------- -----------
Net borrowings (462,611) (6,492) (827) (469,930)
Derivative - cash flow hedge (66,029) - 9,274 (56,755)
Net debt (528,640) (6,492) 8,447 (526,685)
------------------------------ ---------- ------------- ---------- -----------
During the period under review, the company entered into
additional forward-starting interest-rate swap agreements,
totalling GBP150 million, in addition to the existing swaps which
expire in 2014 and 2016, respectively. The weighted average
interest rate of the new swaps is 1.78%, from July 2016 to July
2018. Swap agreements totalling GBP400 million are now in place
until July 2018.
The GBP9.3-million non-cash movement on the interest-rate swap
arises from the movement in fair value of the swaps.
14. Dividends paid and proposed
Unaudited Unaudited Audited
26 weeks 26 weeks 53 weeks
ended ended ended
27 January 22 January 29 July
2013 2012 2012
GBP000 GBP000 GBP000
Paid in the period
2012 interim dividend - - 5,069
2012 final dividend 10,021 10,475 10,475
10,021 10,475 15,544
----------------------------------- ----------- ----------- ---------
Dividends in respect of the period
Interim dividend 4,835 5,069
Final dividend - 10,021
----------------------------------- ----------- ----------- ---------
4,835 5,069 10,021
Dividend per share 4p 4p 8p
----------------------------------- ----------- ----------- ---------
15. Share capital
Number Share
of capital
shares GBP000
000s
-------------------------------------- ---------- ---------
Opening balance at 24 July 2011 131,608 2,632
Allotments 14 -
Closing balance at 22 January 2012 131,622 2,632
Allotments 16 1
Repurchase of shares (5,602) (112)
-------------------------------------- ---------- ---------
Closing balance at 29 July 2012 126,036 2,521
Closing balance at 27 January 2013 126,036 2,521
-------------------------------------- ---------- ---------
All issued shares are fully paid.
16. Related-party disclosure
There were no material changes to related party transactions
described in the last annual financial statements. There have been
no related-party transactions having a material effect on the
Company's financial position or performance in the first half of
the current financial year.
17. Capital commitments
The Company had GBPnil capital commitments for which no
provision had been made, in respect of property, plant and
equipment, at 27 January 2013 (2012: GBPnil).
Independent review report to J D Wetherspoon plc
Introduction
We have been engaged by the Company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 27 January 2013, which comprises the Income
Statement, the Statement of Comprehensive Income, the Cash Flow
Statement, the Balance Sheet, the Statement of Changes in
Shareholders' Equity and related notes. We have read the other
information contained in the half-yearly financial report and
considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the Disclosure and Transparency Rules of the United Kingdom's
Financial Services Authority.
As disclosed in note 2, the annual financial statements of the
Company are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with International Accounting Standard 34, "Interim
Financial Reporting", as adopted by the European Union.
Our responsibility
Our responsibility is to express to the Company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review. This report, including the
conclusion, has been prepared for and only for the Company for the
purpose of the Disclosure and Transparency Rules of the Financial
Services Authority and for no other purpose. We do not, in
producing this report, accept or assume responsibility for any
other purpose or to any other person to whom this report is shown
or into whose hands it may come save where expressly agreed by our
prior consent in writing.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity' issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 27
January 2013 is not prepared, in all material respects, in
accordance with International Accounting Standard 34 as adopted by
the European Union and the Disclosure and Transparency Rules of the
United Kingdom's Financial Services Authority.
PricewaterhouseCoopers LLP
Chartered Accountants
15 March 2013
1 Embankment Place
London
WC2N 6RH
Notes:
(a) The maintenance and integrity of the J D Wetherspoon plc
website is the responsibility of the directors; the work carried
out by the auditors does not involve consideration of these matters
and, accordingly, the auditors accept no responsibility for any
changes that may have occurred to the financial statements since
they were initially presented on the website.
(b) Legislation in the United Kingdom governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR GGURUWUPWGBC
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