The leisure sector has partially recovered following last week’s steep decline, climbing 3.4% and gaining £58m across the portfolio of 21 companies, while the FTSE All Share Index remained relatively static.
The most notable rise came from Young’s, which jumped 7.4% after releasing its FY figures that showed a 17% rise in adjusted pretax profit to £27.2m in the year to 31 March. The company also announced plans to rebrand its tenanted arm as the Ram Pub Company by the end of the summer.
Troubled tenanted operator Punch Taverns gained an impressive 5.6%, bringing its share price to 14.25p.
Marston’s has climbed by 4.2%, reaching a share price of 153.72p, a turnaround from a drop last week despite positive results from the group; the group reported a 9.4% rise in underlying profit before tax to £29m for the half year to 5 April.
For a company whose share price often remains relatively static, Shepherd Neame made a significant climb of 3.5% after announcing it is simplifying its shareholder structure to make the company more appealing to investors.
Greene King is up 3.8% to 821.5p in the same week it reportedly made a bid for c158 pubs from Orchid’s estate. The company released figures from its own Leisure Tracker that showed British household spend for April is up 8% thanks to the warm weather.
The Restaurant Group is up 3% in the same week leading analyst Karl Burns of Panmure Group reiterated his Buy recommendation, despite the fact TRG underperformed the FTSE All Share by 11% over the last month. Burns said the stock “retains the possibility of upgrades moving through the year”, given “the strength of recent trading further underpinned by the improving UK economic environment”.
Domino’s Pizza, Fuller’s and Eclectic also all climbed.
Mitchells and Butlers fell by 4.8% to 413.8p despite positive H1 results this week that reported total revenues for the group increased by 2.5% to £1.016bn and like-for-like sales increased by 1.1%.
Peel Hunt issued a Hold recommendation for M&B: “The first six months showed steady progress and presented clarity on the pension front. However, while the prospect of a return to dividends may attract some, there appears little need to rush into what is a relatively slow recovery story.”
Prezzo fell 3.6% to 142.45p this week after being one of the only companies to rise last week. Similarly, Heavitree Brewery, which enjoyed a peak in its market cap last week, fell by 8.7% to 315p, bringing it back in line with previous prices.
Spirit also fell (by 2.7%), the same week it announced the impending departure of commercial director Clive Briscoe and a management restructuring to combine its managed operation and commercial functions.
After switching the company’s debt for equity, bowling group Essenden remained static this week.
