Enterprise Inns Share Discussion Threads

[layer cake] 17/6/2010 10:33

this stock is not behaving as it should & cannot find the reason why it is being held down.

any clues, anyone.

[crosswire] 09/6/2010 13:28

Looking oversold...

Pubs are going to be packed for world cup!!!

[essentialinvestor] 12/5/2010 17:55

Looking at JDW, so yes I check out the related BB's

And I agree you need to be highly selective with Director dealings,
as with stock selection.

[jeffian] 12/5/2010 17:45

Hi EI,

I had to go and check out what I did say on MRW! I don't think it's incompatible with my comment above. Generally, I don't take much notice of Director dealings - particularly modest purchases which are usually designed just to be a 'show of faith' nor sales of options which most Directors regard as part of their remuneration package - but I sat up and took a bit of notice when all the Directors of ETI including founder and CEO Ted Tuppen sold a fairly substantial proportion of their core holding after the shares had risen to around 180p from a low of 36p(?) so I did the same, largely because I needed to see some income flowing and that signal plus David George selling the equities and buying the Bonds didn't suggest an imminent return of the divi!

Nice to see you paying attention, though!

8-)

[essentialinvestor] 12/5/2010 17:05

jeffian

You appear to be late convert to Director dealing Post 353.

That did make me smile following your previous comments on the MRW thread.

[crosswire] 11/5/2010 08:44

Enterprise Inns cheers solid half year performance and new debt agreement

News Created: Tuesday, May 11 2010 by Stockopedia News 0 comments . Enterprise Inns » Pubs Restaurants & Bars Leisure


UK pub operator Enterprise Inns (LON:ETI) has managed to complete a £625m refinancing of its bank debt in time for today's interim results, which it described as "solid" given the challenging economic conditions the sector still faces.

In the six months to March 31, 2010, Enterprise posted a pre-exceptional ebitda figure of £206m, down from £226m in the same period last year. Profit before tax and exceptional items came in at £86m from £104m last time, while the statutory pre-tax profit figure was £91m, up from £9m. Enterprise maintained its strategy of selling underperforming pubs during the first half, which raised gross proceeds of £135m and an exceptional profit of £32m. The group's underlying net debt was slashed by £163m and with its new debt deal the company has agreed an amortising facility that starts in May 2011, with final maturity in December 2013.

Ted Tuppen, Enterprise's chief executive said: "In the face of very challenging trading conditions across the pub sector, these are solid results which reflect the quality of our pub estate, the resilience of the leased and tenanted pub model and, above all, the skills and determination of our retail partners and the Enterprise team."

Mr Tuppen added that the group had a robust balance sheet, a secure, flexible and tax efficient debt structure and was continuing to generate strong operating cash flows, enhanced by a successful programme for disposing of underperforming and non-core pubs. He noted that trading conditions were expected to remain challenging during the second half of the year and said he hoped that the new Government would take steps to recognise and support community pubs and their "vital role" in British society.

In a trading update in March, Enterprise acknowledged a set of proposals made by the recently appointed Minister for Pubs and his commitment to help the pub industry with funding of £4.3m over the next three years. However, it said that the cash commitment compared poorly with the £20m the group spent supporting deserving licensees last year alone and "pales into insignificance" when set alongside the extra £160m beer duty burden imposed by the Chancellor in his latest Budget.

Enterprise's pub estate now comprises 7,138 pubs, valued at £5.3bn – an average of £740,000 per pub. The group owns the freehold of 97% by number and 99% by value of the pub estate and total annualised leasehold rent payments are approximately £6m, including the impact of the recent sale and leaseback programme.

[jeffian] 10/5/2010 11:27

Following the Directors seems to be the right thing to do. I took some off the table at around 180 when they last sold and put it into corporate bonds as I needed some income (though not the ETI bond - thought I had enough exposure here!) and I assume that was the thinking behind FD David George's switch from shares to bonds. I think management - TT in particular - are keen to pay some sort of divi asap (perhaps a final next Jan?) and if they could do that in the wake of refinancing it would be a pretty strong signal to the market that they are not completely beholden to the banks. We shall see (though maybe not tomorrow).

[limit up] 10/5/2010 11:04

jeffian.
i bought 135000 nominal of the 6.5% 06/12/18 bond at 63,when the dir bought,re financing will be good all round,as you said maybe return to the dvd list for the ord shares..next year?
regds

[jeffian] 10/5/2010 10:45

I don't suppose the Interims tomorrow will surprise on the figures which have been pretty well flagged up, but it would be nice to have the uncertainty of the refinancing out of the way, so this looks interesting -



Also interested to see talk of TT moving up to Chairman with Simon Townsend stepping into CEO role which gives continuity. TT is so closely associated with the company I think it would be a bad signal if he 'did a Thorley'. Now if he could stabilise earnings and, maybe, reinstate some sort of divi.....

[crosswire] 21/4/2010 06:31

PUB report tomorrow

[badtime] 10/4/2010 10:08

Yes..u wudnt b getting tht gross reemption yield if it wasnt risky..i am aware tht most high grade bonds r offering much much less.

Re 40p ..yea hindsight n all tht...i did same with some bank bonds and b/s pibs..hav a nice capital gain (on paper) and a gd running yield...some bonds I have taken the gain...as i was quite exposed to one area...re interest rates spike..yes ther is tht risk..but then i hav exposure to index linked gilts..so hopefully covered ther...its a question of balance ..and i wont b looking to buying tht many...its for my sipp..i'm currently on inc drawdown

[jeffian] 09/4/2010 23:28

You'd have been a lot better off buying 'em at under 40p just over a year ago!

As dividends and bank interest have both been decimated, I bought various corporate bonds last year to try to keep a reasonable income stream going. Personally, I'd rather keep the redemption date short as at least you know you'll get £1/£1 within a reasonable time. Although the running yield looks attractive, if interest rates spike at any time over the next 8 years, there's still scope for the price to fall in the meantime but if you're happy to sit on a fixed yield of about 8% for 8 years to redemption, it could be OK. Horses for courses. There are still some (I'm not one) who thinks the co could still go bust so the high yield comes with some risk. Having said that, the FD bought about £200k-worth of the bonds not that long ago so I suppose that's a reasonable indicator of confidence!

[badtime] 09/4/2010 20:39

Toying with buying the 2018 bonds yielding 6.5 at 87.5p

[layer cake] 01/4/2010 17:06

got in yesterday @ 119 so very happy. followed the stock since getting in to GKN and am sure traders switch between the two.

lets hope the job report out in the states is good tomorrow so that all fears of a retrace for tuesday vanish. Report out even though markets closed.

[maksud] 31/3/2010 19:58

i think the mention of increased duty on beers could have cause some selling.just my opinion.

[evaluate] 31/3/2010 09:48

"Strong cash generation from the business and the proceeds from asset disposals have continued to reduce the level of our borrowings. Based upon discussions with our banking group and input from our advisers, the Board remains confident that adequate banking facilities will be available at the time of our refinancing, which we expect to be concluded before the end of the financial year."

Seems pretty clear to me that debt is under control.

As you say, it's well covered by NAV & they are managing to sell poorly performing pubs at above NAV.

Really can't see what the problem is here.

[kinbasket] 31/3/2010 09:33

from reading a few of the broker notes they are very hung up on the debt issue. the fact that ETI has a large portfolio of freeholds that far out-value the debt seems to be ignored.

ETI are also continuing to sell non-performers at above book value and seem confident the debt issue will be resolved well before the 2011 roll-over.

the laughable thing about the broker recs is that the lowest forecast EPS number is from Execution at 23.8p and they are one of only two who rate it a buy. The other 11 are sell/hold with higher estimates.

[evaluate] 31/3/2010 09:23

I'm with you kinbasket.

What on earth is the sell case?

[kinbasket] 31/3/2010 09:12

I am clueless on this.

Forward PE of 4.6
roughly 50% discount to NAV
0.8x revenue
1.6x forward EBITDA

Every broker on the planet has a sell rating on them.

I suspect the share price action is being driven mainly by the broker ratings.

It makes no sense at all to me.

[evaluate] 31/3/2010 08:52

Why has ETI dropped on that trading update?

What am I missing?

[evaluate] 31/3/2010 07:54

Trading statement out.

- No material change since interim mgmt statement.
- excellent progress disposing of non-performing assets
- proportion of pubs let on sustantive agreements up & trading in these is stable
- cost of supporting struggling landlords is falling
- bank refinancing should happen this year


All in all - pretty positive

RNS Number : 4584J
Enterprise Inns PLC
31 March 2010

?
Enterprise Inns plc
31st March 2010
Enterprise Inns plc (ETI), which will be announcing its Interim Results for the
half year ending 31st March 2010 on 11th May 2010, provides an update on
trading.
There has been no material change in the performance of the ETI business since
publication of the Interim Management Statement on 21st January 2010
(www.enterpriseinns.com/IMS/21.pdf). The proportion of the estate let on
substantive agreements has increased and trading in these pubs remains
relatively stable. We have made excellent progress disposing of underperforming
pubs which do not fit the future profile of the ETI business.
We continue to offer financial support to licensees who find themselves in
difficulty and are encouraged that, whilst the total cost of this support,
business failures and temporary management agreements remains above the
corresponding level last year, these costs are reducing.
Strong cash generation from the business and the proceeds from asset disposals
have continued to reduce the level of our borrowings. Based upon discussions
with our banking group and input from our advisers, the Board remains confident
that adequate banking facilities will be available at the time of our
refinancing, which we expect to be concluded before the end of the financial
year.
These are times of unprecedented challenge for the pub industry and we note the
proposals made by the recently appointed Minister for Pubs and his commitment to
help the pub industry with funding of GBP4.3m over the next three years.
However, this compares poorly with the GBP20m we spent supporting deserving
licensees last year alone and pales into insignificance when set alongside the
extra GBP160m beer duty burden imposed by the Chancellor in his latest Budget.
The Board has reviewed ETI's reporting calendar and decided to update the market
four times a year, with Interim Results in May, Preliminary Results in November
and Interim Management Statements in July and January. Accordingly, ETI does not
expect to release pre-close statements in future.

[evaluate] 23/3/2010 10:57

Morgan Stanley have now joined the party.

Just announced they have crossed the 3% threshhold.

[evaluate] 15/3/2010 08:29

Deutcsje have bought another 1.5m shares.