A leading analyst has said that he expects Fuller’s LFL sales growth in managed pubs to have accelerated from 7% to c10% during its first quarter given the exceptional weather over the past three weeks when it updates the market next Thursday.
Simon French at Panmure Gordon said: “However, at this early stage of the year we would not expect any change to consensus forecasts of £32.5m PBT (43.8p EPS). We forecast £32.5m PBT (44.1p EPS) in FY 2014E underpinned by two new managed pub openings, the conversion of four tenanted pubs to managed, a broadened drinks range, new drinks packaging and the acquisition of Cornish Orchards.”
“We therefore reiterate our Hold recommendation and 834p Target Price continuing to prefer Young’s for those who seek exposure to the London pub and property markets.”
FY 2013A results were broadly in line with expectations with managed pub profits up 6%, tenanted pub profits up 18% but brewing profits down 3% and an increase in central costs.
French said: “The stock trades on a CY 2014E adjusted EV/EBITDAR of 10.9x, a premium to the sector average of 10.1x reflecting its premium positioning and London and South East trading base. We therefore reiterate our Hold recommendation and 834p Target Price continuing to prefer Young’s for those who seek exposure to the London pub and property markets.”
