Enterprise Inns Share Discussion Threads

[livic1971] 21/1/2010 13:10

I suspect rebuying of the 66 million shares on loan in December (12%) will have a much bigger impact on the share price One half positive statement like today and....

[crosswire] 21/1/2010 13:09

Festive cheer for Enterprise Inns
(UKPA) – 1 hour ago

Pub group Enterprise Inns cheered investors with news of a welcome uplift in sales for many of its recession-hit licensees after a "generally strong" Christmas.

The UK's second largest pub firm reported an ongoing turnaround in trade at its higher quality pubs and said earnings declines across the whole estate had eased - halving from 8% to around 4% in the 16 weeks to January 16.

While the UK's "big freeze" disadvantaged some pubs, Enterprise said it "brought welcome extra custom to others".

Shares leapt 11% on the encouraging news, which offers hope of a recovery after a difficult past year.

Enterprise reported a 21% plunge in half-year profits last November.

But it said efforts to offload loss-making pubs and invest in better performers was helping its near 7,400-strong estate.

Average net income was down by an improved 2% across the majority of its estate let on long-term agreements.

It is also seeing more pubs coming off temporary management agreements and those on hold pending legal action, with a rise in good quality licensees seeking pubs.

The Solihull-headquartered group said: "Against a testing background for the UK pub industry, rental income is under pressure and is likely to remain so throughout the coming year. There are, however, signs that trading in better quality pubs continues to stabilise."

It has sold another 103 pubs as part of its disposal programme and is poised to offload a further 129, all at "reasonable profit" above book value in a sign of easing declines in the value of its estate.

[crosswire] 21/1/2010 13:05

Enterprise Inns calls time on profit slump

By Daily Mail Reporter

Last updated at 12:21 PM on 21st January 2010

Add to My Stories Britain may have had the worst snow in decades, but it seems many are ready to brave the cold for a quick drink in the local.

Enterprise Inns, the UKs second-largest pubs company reported a slow down in the rate of profit decline after encouraging sales over the key Christmas and New Year period.

The group, which owns over 7,400 pubs, reported a fall in average net income per pub of 4 per cent in the 16 weeks to January 16, up on last year's 8 per cent decline.

In any weather: Some Enterprise pubs saw a fall in trade due to the snow but others profited from the cold snap

Although some Enterprise pubs suffered as a result of the recent extreme weather, others were positively impacted.

The group said that for some pubs the snow 'brought extra custom and highlighted once again the key role that the pub plays at the heart of many communities.'

Enterprise faces continued pressure on rental incomes in the first half of 2010, but said it draws confidence from stabilising trading in many of its higher quality pubs.

The sale of 103 underperforming pubs generated £32million for the firm during the 16 weeks to January 16 and reports suggest Enterprise is also close to selling a further 129.
Britain's pubs have suffered an onslaught of obstacles over the past few years. High unemployment, the smoking ban, the recession, hikes in beer taxes, poor weather and cheap alcohol offers in supermarkets have all combined to keep consumers at home.

However, Enterprise rivals Mitchells and Butlers and JD Wetherspoon both reported strong sales over the holiday period suggesting the situation may be improving.


Read more:

[crosswire] 21/1/2010 12:37

Enterprise Inns rose 11.5 per cent to 105.8p, helped by a broker upgrade from "sell" to "hold" from KBC Peel Hunt. The pubs group also reported "a number of improving trends" across its estate.

[cerrito] 21/1/2010 09:04

Collins Stewart take on it
I was surprised at the sale and leasebacks as well; agree makes sense to sell small pubs to tidy up the portfolio but financial impact limited
Cannot make AGM appreciate comments from anyone who can
quote
Don't buy into signs of stability yet...

■ 'Business as usual' statement

There should be little in ETI's Q1 IMS that surprises. Income per pub during the period was down 'only' 4%, due to a reduced tail, easier comps and increasing underlying stability. While this is encouraging, business clearly remains grinding and negative territory continues. We remain concerned that the overall cost of support has increased, while weak consumer behaviour and rising licensee costs (eg, VAT) could see this pressure mounting again. Further, while there is no mention of impending industrial action this has certainly been threatened (GMB) and we do not see the tied-tenanted economic model as either stable or resolved until these disputes abate.

■ Disposals continue, balance sheet confidence remains

ETI has continued to sell underperforming pubs at a premium to book value, 103 during the period for £32m (£311k per pub vs. BS average of £776m including goodwill). We see this strategy as sensible both in terms of reducing the tail and realising cash ahead of the refinancing. However, we remain concerned that the refinancing remains relatively large (c.£6-700m) for £32m of disposals to make a material difference. Any further pressure on bank lending and/or on ETI cash flow could still trigger a resort to equity, in our view. We also see the need to raise cash quickly apparent in the sale and leasebacks now adopted (20 pubs for £39m, £1.95m per pub) – effectively turning EIT into a re-seller of pub assets and eroding the asset base at the top end of the quality scale. We cannot see how this process adds value to equity holders except to the extent that it staves off the banks.

■ Valuation stretched and upside limited

ETI is now trading on forward EV/EBITDA of 9.4x. We continue to believe that this multiple is stretched given uncertainties on cash flow, the operating model and the balance sheet. We also struggle to see the multiple as reflecting underlying asset value in the current market, notwithstanding recent sales at book value. Further, given the pressures from licensees we see any material recovery as being used to rebalance the economic model, leaving little upside for ETI equity. We therefore reiterate our SELL recommendation and see better value in Greene King (BUY).

[jazza] 21/1/2010 07:22

Speaks volumes..


"These sales have generated a reasonable profit above book value and confirm our view that our pub estate is conservatively valued and that pub values are beginning to stabilise. In addition, we have taken advantage of a strong market for sale and leaseback properties in London, selling at auction during the first quarter 20 pubs for net proceeds of GBP39 million, based upon 35-year, non-index linked leases back to ETI at an average rental cost of 6%. These pubs realised a significant profit above book value."

[iomhere] 14/1/2010 11:50

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glennborthwick - 02 May'05 - 17:35 View 'glennborthwick' profile

I have been approached regarding my business to consider the possibility of a pre-IPO placement with a view to an introduction or flotation on ofex/AIM in a year or so.

Id like to pick the esteemed brains of ADVFN members about what I should watch out for , would you invest, what am I worth and most importantly, what criteria goes towards dictating this valuation?
===============================================================================

Must have gone into nuts.
(301 of 302)

[jeffian] 12/12/2009 12:56

Don't quite follow that, glenn. a) it's not possible to "shut down" any tenancy as long as they're paying their rent etc. and b) even if they're not, it can't be done "without notice" or quite a protracted legal process. Care to expand on your comments?

Regards, Ian

[glennborthwick] 11/12/2009 17:51

i service eti's with nuts etc, and something bad is going on last couple of day . Landlords being shut down without notice , even decent pubs. Wierd.

[larsson2] 11/12/2009 13:52

Are we breaking the trend today and staying above £1.04 or even £1.05? That would be a positive for this share....at last, albeit in the short term.

[jeffian] 07/12/2009 16:58

It's a play on confidence really - 'fear' that it'll be overwhelmed by its debt offset by 'greed' that it looks cheap on fundamentals - hence the relatively large swings. Personally, I see no reason why it should break out of its current range in the short term; it has no dividend to support it, profits are projected to decline next year and until the bank refinancing is completed next year the threat of a RI must linger. On the other hand, if they could stabilise their earnings around 25p/share, see property values stabilise, complete the refinancing without dilution and possibly reinstate a divi at an appropriate level, it's got to be worth around £3 in a fair market, hasn't it? I've hedged my bets on this one - I followed the Director sales at around 170p in August with some and hold the rest for recovery (but I'm not expecting that to happen any time soon!).

[larsson2] 07/12/2009 16:36

Well that's a tad encouraging in that the share price went up during a rather red day all round. Is this the bottom ? Could be but tendency is for this share is a rapid rise followed by an equally sharp fall....again.

[diku] 01/12/2009 14:39

larsson...you must have read my mind...I too had 120p in mind to get out..

[larsson2] 01/12/2009 13:15

Unless some sort of technical correction occurs or very unexpected good news emanates from the Board I would not be surprised to see this bounce in the 90's for a while 'til Interim statement due end of Jan.
In saying that c'mon just get back to £1.20 then I'll sell!

[diku] 01/12/2009 11:53

this is stuck in a bottle neck of just above 100p...

[osirisra] 26/11/2009 12:10

And there we have it,,,,,,,,,,,,,, £1. I did say some weeks back that these would be a pound by Christmas.

[larsson2] 24/11/2009 15:53

So its a sell then no buying at all ...great so have to put these shares onto the backburner as well for a while.

[5dally] 24/11/2009 15:08

ETI.LS - ENTERPRISE INNS (LSE)

Date Open High Low Last Change Volume % Change
11/23/09 113.5000 116.0780 110.3000 111.1000 -1.9000 2716175 -1.68%


Composite Indicator
Trend Spotter TM Sell

Short Term Indicators
7 Day Average Directional Indicator Sell
10 - 8 Day Moving Average Hilo Channel Sell
20 Day Moving Average vs Price Sell
20 - 50 Day MACD Oscillator Sell
20 Day Bollinger Bands Sell

Short Term Indicators Average: 100% - Sell
20-Day Average Volume - 3571064

Medium Term Indicators
40 Day Commodity Channel Index Sell
50 Day Moving Average vs Price Sell
20 - 100 Day MACD Oscillator Sell
50 Day Parabolic Time/Price Sell

Medium Term Indicators Average: 100% - Sell
50-Day Average Volume - 5033837

Long Term Indicators
60 Day Commodity Channel Index Sell
100 Day Moving Average vs Price Sell
50 - 100 Day MACD Oscillator Sell

Long Term Indicators Average: 100% - Sell
100-Day Average Volume - 4294572

Overall Average: 100% - Sell

Price Support Pivot Point Resistance

111.1000 106.7147 112.4927 118.2707

[investinggarden] 18/11/2009 09:43

Sell rating from Growth Company Investor

[yng1nvestor] 17/11/2009 10:55

whos ready for the V

!!!!!!!!!!!!!!!!!!!

[yng1nvestor] 17/11/2009 09:25

130, here we come!