Marston's Share Discussion Threads

[skinny] 14/2/2020 10:10

Ralph Findlay.

[jeffian] 14/2/2020 10:08

Why wouldn't I agree?

[luderitz] 14/2/2020 09:46

RF? who he.

[dinvester] 14/2/2020 00:06

I know that Jeffian may not agree, But no matter what is done by Marstons as a company, all potential investors know who is driving it and why the decisions have supposed to have been made by those who are supposed to be advising.
Ultimately RF is the huge glaring thorn in the side of Marstons.

[our haven] 10/2/2020 10:59

That is what I mean Skinny. The market now thinks that it is unlikely hence the fall whereas I always thought it was an outside chance. Mr Market always overdoes things so my outside chance is higher than Fridays close.I am only looking here at the takeover possibilities premium or lack of it.

[skinny] 10/2/2020 10:52

Except for the share price! :-(

[our haven] 10/2/2020 10:51

Don't disagree with you Jeffian but will take all the help.I think that the potential in the market for a takeover has faded for Marstons, the reality is nothing has changed.

[jeffian] 10/2/2020 09:53

Maybe, but the 2 companies are chalk and cheese.

[our haven] 10/2/2020 08:58

Mitchells & Butlers upgrade by Berenberg to buy from hold on a valuation basis after recent falls, I assume is what is helping the rise this morning for Marstons.

[jeffian] 07/2/2020 23:31

You don't need to offload them. You split the business into separate entities - breweries and pubs - and let each make their own way. Sure, in some cases it proves the brewing is unviable (Eldridge Pope, Devenish etc) but MARS probably have strong enough brands (Pedigree) to attract interest as Fullers did from Asahi and Sharps sold Doom Bar to Molson Coors.

[dinvester] 07/2/2020 23:15

Jeffian.
I would on this occasion agree that you have a valid point.
However, I would think that selling pubs/real estate is a much easier option than offloading breweries.

[grahamburn] 07/2/2020 20:21

Isn't the chairman a relative new appointment?

From my limited knowledge isn't he the prime mover in making inroads into the debt situation (albeit limited) whilst keeping the shareholder base content by at least maintaining the dividend?

Having said that, the CEO has been in situ for too long and should be replaced by someone with new ideas and a more proactive approach to remodelling the business.

[meijiman] 07/2/2020 10:51

I think there is an issue with this company with an all powerful Chairman protecting ceo relationship. So agree with din on that. As to what to do about it... Some really poor decisions have been taken at this company. The debt is something of a millstone.

[jeffian] 07/2/2020 10:42

Never mind selling pubs, the fundamental issue I think they need to address is their continued love affair with brewing, and via a multiplicity of breweries. They have continued to invest heavily in additional capacity and brands when almost every other brewer/pubco has split these functions and most have given up brewing, leaving that to the enormous internationals or the myriad small micro-breweries that have sprung up. Marstons is squeezed between the two. If the likes of Fullers don't think brewing is worthwhile, despite having invested very heavily in their re-vamped Chiswick brewery and having excellent brands, why do Marstons plod on in this highly competitive low-margin side of the business?

[dinvester] 07/2/2020 10:14

Too many yes men and women frightened of the CEO.
Running Marstons like his own empire and Never really brought to account for the terrible decisions he has made, or agreed to.
Yet there he is, still there.
I see messages on here where some users have put tough'ish questions to him but it's just as if he puts his umbrella up and it all just runs off and down the drains.
The length of his raign, for those who know him, must be unfathomable.

[rmillaree] 07/2/2020 10:07

Marstons isn't generating sufficient profit to generate enough free cash to pay down debt. They have To sell.

Marstons is generating enough profit down debt - that bit is simples as far as i am concerned - i firm;y disagree with any suggestion otherwise - but am open to being proved wrong if you supply evidence to the contrary.

What Marstons has not been able to do is have its cake and eat it - so it has not been able to invest in the estate to the extent it has over the last 5 years and pay a chomping dividend and make the acquisitions it has done whilst making any headway on the debt - that has been disappointing but it doesn't alter the fact that if it chose to spend less on estate improvement and dividends it would have been able to pay down debt early.
I would like to think the estate quality of what Marstons have now is superior to what it was 5 years ago and hopefully the estate they have now is more fit for purpose - whether my assumption is right in this regard i dont know , in some respects they have probably had to invest something just to stand still so perhaps the illusion of the decent investment in new outlets that have generated good cash returns is just that.

Being honest anyone who worries about the debt probably really should give this share a miss - there is risk that if they don't maintain a certain level pf profits the divi will either go or they will go back cap in hand to the market again (or both).
Note the one plus side of the new paying down the debt strategy as long as they don't have to sell the crown jewels is that once debt gets down 20-25% that means less interest and more cashflow to pay down debt faster. There was a good illustration of this in action in one of their presentations no so long ago as how the "mortgage style" repayment of debt would see dramatic reductions in the late 2020's - whether this ever works in reality i don;t know as i would guess at that time they would probably do something else with the cash.

The near main short issue here is cost inflation if probably higher than they would like aligned presumably with a flatish or possibly shrinking customer pool.

[redartbmud] 07/2/2020 09:01

Marstons isn't generating sufficient profit to generate enough free cash to pay down debt. They have to sell.
At the AGM Findlay commenteed that pub trading went in cycles and that for the present time, wet led sales were leading the way and food led pub trading was softer,
So, they sell wet led pubs.
Hmmm......maybe thet should rebrand as 99p Pub chain, when the share price falls below the magic £1.

[dinvester] 06/2/2020 23:58

According to rumours circulating, Hawthorn Leisure (New River) have agreed to the acquisition of 29 Generous George branded portfolio of Marstons pubs.

[chinese investor] 31/1/2020 10:14

I'll buy some at a pound !

[pubs advisory service] 30/1/2020 09:43

Redartbmud - thank you.

Q: What does a barrel of beer yield?

CEO: refuses to answer in his answer and cites confidentiality despite it being a duty paid product and the awards being public.


Comment:
For the CEO to not inform someone of the contents of the duty paid product his firm produces is....well.... the alarm bells should be clanging off the walls as that was the crux of the Anderson case, he has clearly not learned his lesson and repeats the failed defense of the firms lawyers. Tenants could use this comment as a breach of fair and lawful dealing under the Pubs Code and raise complaints today - the Regulator could go ahead and fine the firm 1% of its group turnover for failing to adhere to the awards and refusing to disclose contents when asked, this was all laid out in the awards. Doubling down just doubles the costs, you need to be having words with him and ensuring your investments are not being frittered away by continued refusal to act lawfully. The company needs to be speaking with us as this is not going away and they are seemingly making it worse.

Taken from the Act: 55 Forms of enforcement
(1) If, as a result of an investigation, the Adjudicator is satisfied that a pub-owning
business has failed to comply with the Pubs Code, or has failed to follow a
recommendation made under section 56, the Adjudicator may take one or
more of the following enforcement measures—
(a) make recommendations;
(b) require information to be published;
(c) impose financial penalties.

[redartbmud] 29/1/2020 22:05

It is a vice clamped around their sensitive parts, and it is squeezing them tight!!

HSBC today downgrades its investment rating on Marston's PLC (LON:MARS) to reduce (from hold) and cut its price target to 90p (from 100p).

HSBC today reaffirms its hold investment rating on Mitchells & Butlers PLC (LON:MAB) and cut its price target to 425p (from 435p)

[fenners66] 29/1/2020 21:38

I looked at these some time ago and was wary of the debt , but thought I had at least missed the boat for the capital gain <100 to 130.

However I was saying to myself that the debt could yet come home to roost.

Not only that , but if I had bought for the dividend I would probably hang on despite the share price fall.

So , now they are back to 104 I am feeling better as in did not chase them higher, and we know more about the current state of the business and its not encouraging.

Happy to watch and wait.

[redartbmud] 29/1/2020 17:34

Precisely. Quite clearly the new remuneration policy recognises that profits are falling and are unlikely to recover.
Based on the last financial year, none of the bonus targets were hit and they received nothing from the share incentive scheme.

Answer - lower the targets, so they get bonuses and shares.

Job done!!

Simples.....