Pub group Fuller's is gearing up for reopening through a share placing and extension of its bank facilities.
Fuller's has proposed a non-pre-emptive placing of up to 6,455,447 new 'A' ordinary shares, representing up to 20% of the group's existing issued 'A' ordinary share capital. The price will be 830p per placing share, to be conducted via an accelerated bookbuild.
The company is also providing 'B' ordinary shareholders with the opportunity to purchase 'B' ordinary shares. Directors have committed to contributing £225,000 towards subscribing for 'A' ordinary shares and applying to acquire 'B' ordinary shares in conjunction with the placing.
Lockdowns and trading restrictions have inevitably impacted the group's liquidity position. While Fuller's has been burning through £4m-£5m a month during lockdowns, its net debt now stands at £216m and revenues across the group's managed pubs and hotels are expected to be around 80% down this last year. As a result Fuller's has extended existing debt facilities with its banks to February 2023.
Fuller's said the proceeds from the placing with the revised banking facilities would strengthen the group's balance sheet and allow it to explore growth opportunities on reopening and provide additional liquidity, headroom and resilience if the easing of restrictions is delayed or restrictions are reintroduced.
The group said it planned to take a phased approach to reopening with 82 sites opening initially and the remainder of its managed pubs and hotels largely trading by 17 May. Approximately 70% of the group's tenanted inns are expected to open on 12 April. It added that its long-term strategy remains unchanged despite the short-term challenges presented by the pandemic.
Simon Emeny, chief executive of Fuller's, said: "The last year has been hugely demanding both for our business and the wider hospitality sector, but we have risen to the challenges presented by the pandemic to emerge stronger, which is the Fuller's way. We have used the time wisely, rightsizing our teams, building our digital capabilities by continuing to innovate, as well as investing in our properties, and we are confident that we are in the best possible position to reopen.
"It was clear the demand for our premium pubs and hotels was as strong as ever when we were allowed to trade last year, which gives us confidence for the weeks and months ahead. Over half of the UK adult population has now had its first vaccine and we have a great team of people in place who are match fit and ready to welcome our customers back into our wonderful pubs and hotels.
"The additional financial flexibility we are seeking to put in place will enable us to further capitalise on the opportunities open to us as we execute our recovery plan and regain growth momentum."