Marston's Share Discussion Threads

[exel] 10/10/2017 20:37

"Our new pubs continue to open strongly and the performance of those opened in recent years remains good and in line with targets. We remain confident that investment in new pubs and bars creates shareholder value, and is an important component of our strategy to achieve organic growth."

Anyone who read my much earlier posts on CapEx will see why I especially liked the above.

[richie1218] 10/10/2017 15:46

It’s been a painful year for shareholders of Marston’s (LSE: MARS) as the pubco’s share price has fallen over 20% in value. However, this means they’re now trading at less than eight times forward earnings while kicking off a whopping 7.1% dividend yield that is still covered by earnings.

Encouragingly, there are also signs that a nascent turnaround in the company’s fortunes are beginning to take hold. The company’s full year trading update released Tuesday morning reported positive like-for-like (LFL) sales growth in each of its divisions as well as the opening of 19 new pubs and plans to open a further 15 in fiscal year 2018.

This is great news for the company as the sector as a whole has been fighting falling footfall and subdued out-of-home alcohol purchasing for several years now. Marston’s has fought back with a twin-pronged strategy that has seen it turn tatty old boozers into family-friendly pubs, heavy on food offerings, as well as going upmarket with other pubs and bringing in plenty of craft beer options.

The group’s brewing options were also a bright spot during the year to September as it shipped 6% more volume of its own brand beers than in the prior period. Adding in the acquisition of Charles Wells brewing and beer distribution rights for £55m helped drive good market share gains.

The trading update didn’t release any word on profit movement for the year as a whole but underlying earnings per share did rise 4% year-on-year (y/y) in H1. At the end of the opening half, net debt was level at £1.3bn, or 5 times EBITDA, which is in line with competitors and makes sense for what is essentially a property company. This figure will constrain huge returns of capital to shareholders but it did allow for a 3.8% rise in interim dividends.

If management’s plans to increases same-store sales and open new outlets continues to work, I reckon Marston’s could be an attractively priced income share right now.

[123trev] 10/10/2017 14:45

I wouldn't be to concerned about any of the Brexit rubbish and is any beer imported! I think it's all done here to that special recipe.

[spacecake] 10/10/2017 14:38

Retailers warn of 'post brexit gaps on shelves' says the FT - which could be good news here if beer imports recede.

[123trev] 10/10/2017 14:26

slight retrace perhaps but with the divi looking intact and nerves abaitted then I think this could be going up now but as we all understand nothing in life is certain.

[essentialinvestor] 10/10/2017 14:15

May gap fill yesterday's close at some point.
I traded a few today, having bought late yesterday,
would expect some others did similar.
Statement looked solid imv.

[spacecake] 10/10/2017 14:13

Popped its cork and quickly going flat !

[andyj] 10/10/2017 14:00

Becoming a bit of a damp squib now, anyone spot a reason to sell in the trading update?

[dongle features] 10/10/2017 09:21

Numis Add 109.50 125.00 125.00 Reiterates

Shore Capital Buy 109.50 - - Reiterates

Liberum Capital Buy 109.50 140.00 140.00 Reiterates

Peel Hunt Add 109.50 140.00 125.00 Reiterates

[skinny] 10/10/2017 09:18

Numis Add 109.50 125.00 125.00 Reiterates

Shore Capital Buy 109.50 - - Reiterates

Liberum Capital Buy 109.50 140.00 140.00 Reiterates

Peel Hunt Add 109.50 140.00 125.00 Reiterates

[trytotakeiteasy] 10/10/2017 09:17

not really sure why the shares have rallied... like for like sales are still very low and margins will decline

[chinese investor] 10/10/2017 08:49

GO GO HORSEY !

[chinese investor] 10/10/2017 08:41

Here We Go !

[exel] 10/10/2017 08:36

Oh the irony, MARS is now dragging GNK upwards! So we move down on their weaker (agm) update, and they move up on our relatively stronger (year end) one. Hey ho.

[chinese investor] 10/10/2017 08:20

Looking Good !

Great Secured Dividend !

[cwa1] 10/10/2017 08:16

Morning All

That update seem better than I had expected. Been watching this for a while now and decided to take the plunge and join you this morning at almost 106p. Can't see much/any danger to the dividend from anything they've said and, hopefully, that will comfort and keep us warm here until the wider market picks up. Sounds, to me, that management have got a good handle on the business and it is "steady as she goes"-just the way I like it. Good fortune to all holders.

[exel] 10/10/2017 08:05

The number of outlets is noted at 1550 (compared to 1560 in the 2016 year end trading update) so there have been net exits as well as the much critiqued entries. Tells me their portfolio management has been selective & active rather than wantonly expansive, as some tend to imply. Also seems that beer sales have outperformed food during a tougher year, so it's reassuring to have their 'no 1 position in cask ales' to help sustain the group during a tougher year. On balance, and in context, hard to see that this update could have been much better. Forward guidance remains reassuring.

[essentialinvestor] 10/10/2017 07:51

In fairness it's not priced for dynamic growth!.

More expansionary CAPEX cuts to come imv, cashflow, as I mentioned yesterday,
is the key. That's what the market wants to focus on currently.

[pugugly] 10/10/2017 07:47

Agreed - Steady as she goes - BUT no dynamic growth on the horizon - Trade (imo) is unlikey to exceed or deceed that of the balance of the restaurant and pub trade. So (imo) an OK income stock but share price trend probably in line with market. (IMO & DYOR)

[essentialinvestor] 10/10/2017 07:39

Yes, however notice the £5 million of operational savings they have identified,
announced today.

[spacecake] 10/10/2017 07:33

I see there are no time references to recent trading, such as last years statement which said "In the last 10 weeks of the period like-for-like sales have grown 1.8%."

That to me along with the mention of newly identified cost savings is indicating that recent trade has dropped off and I'm not too sure if "changes to the operational structure" is going to make comparisons easier in the future!

Not the end of the world, but for an end of term report... must try harder or the share price will continue to get whipped.

[essentialinvestor] 10/10/2017 07:23

Agree re GNK.

[lord gnome] 10/10/2017 07:19

Unless there is something hidden between the lines that has escaped my notice, then that update reads as well as I could have hoped for. No reason at all for the share price to be where it is and I would expect it to make progress from here. MARS is clearly doing better than GNK.

[essentialinvestor] 10/10/2017 07:12

When you have paid for shares at the market price, as the CEO recently has,
it does tend to concentrate the mind. So positive to see CAPEX slightly
dialed back. And more of that to come perhaps. Cashflow and debt metrics are key.