Punch Taverns executive chairman Stephen Billingham has told M&C Report that discussions with different parties over its debt restructure negotiations have been “lively” and said it’s “good news” that all stakeholders are involved.
Billingham also said he expects the majority of new agreements being issued to be its franchise-style Punch Foundation Tenancy (PFT).
Announcing its Q1 results yesterday, Punch reiterated its view that it intends to announce its restructuring proposals in December. “It should happen in the early part of the month,” Billingham told M&C Report.
He described negotiation with the different parties as “lively”. Among the parties involved is the committee of its senior bondholders, under the auspices of the Association of British Insurers, which earlier this year described the pub company’s restructuring proposals as being “some distance away from being acceptable to us”,
Billingham said: “We are in a period of negotiation with material stock holders and that’s good news. In the past we had certain stakeholders who we didn’t have proper negotiations with, and that’s stopped.
“People are debating all the points with each other and with us.”
Billingham said about 50 pubs currently operate on the PFT agreement and the company is “on track” to reach its target of 200 by the end of 2014.
“The majority of tenancies going forward will be on the PFT structure,” he said.
“They are doing well. What we are doing is supporting tenants a lot more than we have done historically.
“What we want to do is have partners succeed from early days. The way we see it is we spend a lot of money getting the physical offer right. The next bit is to get the offer for the partner right as well.”
He added: “This is quite a leap forward in the tenanted sector. It’s a change of mind-set that says we need to be there to help the partners. What we want to do is cut down the number of partners that fail in early years in particular.”
Earlier this month Punch was announced Business Enabler of the Year at the National Business Awards for its PFT agreement.
Yesterday Punch reported a 1.4% rise in like-for-like net income in its core estate in the 12 weeks to 9 November. It said trading in Q1 represented the fourth consecutive quarter of improving like-for-like trends and, assisted by weak weather comparatives, delivered growth in average net income per pub across the entire estate.
The firm said: “Expectations remain unchanged with management expecting the core estate to return to full year like-for-like net income growth of up to 1% for the current financial year. The pub investment and non-core pub disposal programmes remain on track with full year capital investment expected to be c£45m and disposal proceeds anticipated to be of c£100m raised largely from the disposal of non-core pubs.”
