Punch sees profits decline as it enters restructuring talks
Pub company Punch Taverns saw its pre-tax profits decline by nearly 16% to £64m for the full year to 18 August.
The company, which sold 475 pubs with other assets for £130m during the year, said it was in discussions with major shareholders about a possible restructuring. The business said it remained on track to reduce in size to a core estate of 3,000 pubs within the next five years.
The average net income per pub broadly flat across the year, and like-for-like net income across its core substantive estate was down 1%.
Regarding a review of its capital structure, Punch said: "While the Group has continued to provide financial support to the securitisation structures, significant changes to the securitisations are necessary to protect the material financial and operational benefits that both enjoy as being part of the wider group. Discussions have been initiated with certain major shareholders and other significant stakeholders to seek their input on the range of possible options available to restructure the securitisations."
Roger Whiteside, chief executive officer of Punch Taverns said: "We have delivered profits for the year in line with our expectations and are on track with our disposal programme in extracting maximum value from our non-core assets.
"We are making good progress towards our long-term objective to become the UK's highest quality, most trusted and best value leased pub company, with record levels of investment in our core pubs and an additional 1,100 Partners joining the Punch Buying Club.
"We have completed the review of our capital structure and have initiated discussions with certain major shareholders and certain other stakeholders. We will engage with our remaining stakeholders, including bondholders, at the appropriate time. While the options are complex and will take time to conclude we are confident that a consensual restructuring can be successfully implemented in a manner that delivers value for stakeholders.
By Neil Gerrard
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