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Marston's Interims.

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idpickering
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Marston's Interims.

#221689

Postby idpickering » May 15th, 2019, 7:41 am

Commenting, Ralph Findlay, CEO said:

"I am pleased to report continued growth across all segments of the business. Our Taverns wet-led community pubs have built on the strong trading performance last year and it is particularly encouraging to see our food-led pubs once again achieving increasing momentum in profitable like-for-like sales growth. Our leading Brewing business goes from strength to strength, winning new distribution contracts and continuing to grow market share.

"We remain focussed on our strategic objectives and good progress has been made with our stated aim to improve cash generation and reduce the Group's leverage. Whilst the backdrop of ongoing uncertainty around Brexit continues to be challenging, opportunities for growth remain and we are confident of delivering another year of profitable growth for our shareholders."

And later;

Maintain dividend: The Board is committed to maintaining the dividend at the current level during this period of debt reduction focus.
At this early stage, the actions we have put in place give us confidence that the debt reduction target is achievable over the period.



Div 2.7p per share.

https://www.investegate.co.uk/marston-- ... 00080312Z/

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Re: Marston's Interims.

#221698

Postby Wizard » May 15th, 2019, 8:55 am

idpickering wrote:
Commenting, Ralph Findlay, CEO said:

"...Maintain dividend: The Board is committed to maintaining the dividend at the current level during this period of debt reduction focus.
At this early stage, the actions we have put in place give us confidence that the debt reduction target is achievable over the period.


If they are in the "early stage" of "this period" that seems to signal a flat dividend for some time to come.

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Re: Marston's Interims.

#221701

Postby IanTHughes » May 15th, 2019, 9:08 am

Financial Strategy

In our January trading update we set out a commitment to targeting a £0.2 billion reduction in net debt by 2023.

This was:

- A reduction in new-build investment to around £25 million per annum from 2020 onwards, with investment weighted towards pubs with accommodation, where we are seeing the strongest returns.
- The disposal of £80-90 million of certain non-core assets in 2020-23.
- Through the improvements in free cash flow set out in November 2018 relating to the final salary pension scheme (which has a modest deficit that is expected to be eliminated within three years), the securitisation and reduced organic capital expenditure.

Although new-build investment is being scaled back, new-build pubs and accommodation deliver strong returns and will continue to contribute to growth in Group earnings. In addition, the reduced level of estate expansion will facilitate increased focus on generating like-for-like profit growth from the core pub estate.

The benefits of this plan will be most evident from 2020 but our progress in achieving these targets is encouraging:

It would appear that the dividend will be held for a couple more years at least. However, a yield of around 7% with debt decreasing is not a bad situation to be in in my view. I am quite happy to have built up my holding at what turns out to be a yield of around 7.6% and I for one am not in the least bit fazed by the prospect of a held dividend which, once the debt reduction is achieved, may well start growing again.


Ian

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Re: Marston's Interims.

#221709

Postby idpickering » May 15th, 2019, 9:17 am

IanTHughes wrote:
Financial Strategy

In our January trading update we set out a commitment to targeting a £0.2 billion reduction in net debt by 2023.

This was:

- A reduction in new-build investment to around £25 million per annum from 2020 onwards, with investment weighted towards pubs with accommodation, where we are seeing the strongest returns.
- The disposal of £80-90 million of certain non-core assets in 2020-23.
- Through the improvements in free cash flow set out in November 2018 relating to the final salary pension scheme (which has a modest deficit that is expected to be eliminated within three years), the securitisation and reduced organic capital expenditure.

Although new-build investment is being scaled back, new-build pubs and accommodation deliver strong returns and will continue to contribute to growth in Group earnings. In addition, the reduced level of estate expansion will facilitate increased focus on generating like-for-like profit growth from the core pub estate.

The benefits of this plan will be most evident from 2020 but our progress in achieving these targets is encouraging:

It would appear that the dividend will be held for a couple more years at least. However, a yield of around 7% with debt decreasing is not a bad situation to be in in my view. I am quite happy to have built up my holding at what turns out to be a yield of around 7.6% and I for one am not in the least bit fazed by the prospect of a held dividend which, once the debt reduction is achieved, may well start growing again.


Ian


I agree with you Ian. I hold Marston's alongside Greene King in the sector, and am not fazed about a held dividend with MARS, which seems to be a well run outfit. Might even top up.

Ian.

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Re: Marston's Interims.

#221712

Postby SuperCally » May 15th, 2019, 9:20 am

Payment Date 2 July, per MARS website.

idpickering
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Re: Marston's Interims.

#221717

Postby idpickering » May 15th, 2019, 9:24 am

SuperCally wrote:Payment Date 2 July, per MARS website.


If I may; http://www.marstons.co.uk/investors/sha ... /calendar/

This has gone down well it seems with the sp up 4%.

Ian.

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Re: Marston's Interims.

#221721

Postby blobby » May 15th, 2019, 9:29 am

I'm very happy with this. With new management and a more conservative policy to running the business I think MARS has turned the corner. Here's the the next 200 years. Cheers!

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Re: Marston's Interims.

#221724

Postby IanTHughes » May 15th, 2019, 9:35 am

idpickering wrote:I agree with you Ian. I hold Marston's alongside Greene King in the sector

Snap! I picked up Greene King (GNK) at a yield of 7%.

Roll on the long summer days with everyone enjoying lazy afternoons at the pub!


Ian

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Re: Marston's Interims.

#221729

Postby idpickering » May 15th, 2019, 9:44 am

IanTHughes wrote:
idpickering wrote:I agree with you Ian. I hold Marston's alongside Greene King in the sector

Snap! I picked up Greene King (GNK) at a yield of 7%.

Roll on the long summer days with everyone enjoying lazy afternoons at the pub!


Ian


Same here Ian. This is in keeping with my liking to double up in any given sector if viable.

Ian.

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Re: Marston's Interims.

#221820

Postby TUK020 » May 15th, 2019, 2:16 pm

IanTHughes wrote:It would appear that the dividend will be held for a couple more years at least. However, a yield of around 7% with debt decreasing is not a bad situation to be in in my view. I am quite happy to have built up my holding at what turns out to be a yield of around 7.6% and I for one am not in the least bit fazed by the prospect of a held dividend which, once the debt reduction is achieved, may well start growing again.


Ian


agree with these sentiments/perspective

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Re: Marston's Interims.

#221848

Postby MDW1954 » May 15th, 2019, 5:16 pm

IanTHughes wrote:
Financial Strategy

In our January trading update we set out a commitment to targeting a £0.2 billion reduction in net debt by 2023.

This was:

- A reduction in new-build investment to around £25 million per annum from 2020 onwards, with investment weighted towards pubs with accommodation, where we are seeing the strongest returns.
- The disposal of £80-90 million of certain non-core assets in 2020-23.
- Through the improvements in free cash flow set out in November 2018 relating to the final salary pension scheme (which has a modest deficit that is expected to be eliminated within three years), the securitisation and reduced organic capital expenditure.

Although new-build investment is being scaled back, new-build pubs and accommodation deliver strong returns and will continue to contribute to growth in Group earnings. In addition, the reduced level of estate expansion will facilitate increased focus on generating like-for-like profit growth from the core pub estate.

The benefits of this plan will be most evident from 2020 but our progress in achieving these targets is encouraging:

It would appear that the dividend will be held for a couple more years at least. However, a yield of around 7% with debt decreasing is not a bad situation to be in in my view. I am quite happy to have built up my holding at what turns out to be a yield of around 7.6% and I for one am not in the least bit fazed by the prospect of a held dividend which, once the debt reduction is achieved, may well start growing again.


Ian


I've topped up Marston's several times, and on the basis of these results, am likely to do so again.

Plus, I finally got to use my Marston's "Privilege" card in February, getting 50% off some accommodation, and a very pleasant meal.

MDW1954

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Re: Marston's Interims.

#222241

Postby Paultry » May 16th, 2019, 8:59 pm

MDW1954

Is there a promotion code when you book a hotel room with Marstons? Or is it after check in and presentation of their card?

You mention a 50% discount, which is attractive. I've only used the Greenking hotels to obtain 50% discounts.

On the one occasion I presented my Marston's card in a pub (Pitcher and Piano in Winchester) it was been declined.

Any advice would be welcome. Paul

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Re: Marston's Interims.

#222923

Postby AyresomeAngel » May 19th, 2019, 9:33 am

Poultry
From my experience of booking a room at a Marston hotel at Derby, there was not the option of adding a promotion code to the internet booking. I showed the card when checking in at the hotel and discount was applied.

We presented my card for a company function at Pitcher and Piano at Cornhill, London. They would not take the 20% off the whole bill, but estimated the bill for 5 people and reduced it by £100 (which turned out better than 20%).

The Pitcher and Piano at Winchester is shown as a participating pub on the Marston's Privilege website, so you should have been offered the discount.

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Re: Marston's Interims.

#222946

Postby MDW1954 » May 19th, 2019, 11:20 am

Paultry wrote:MDW1954

Is there a promotion code when you book a hotel room with Marstons? Or is it after check in and presentation of their card?

You mention a 50% discount, which is attractive. I've only used the Greenking hotels to obtain 50% discounts.

On the one occasion I presented my Marston's card in a pub (Pitcher and Piano in Winchester) it was been declined.

Any advice would be welcome. Paul


I've only used it once, despite being a shareholder for several years. Where we live (Devon) there aren't many Marston pubs.

We made the booking by phone, in the end, and the agent applied the discount. There are instructions that come with the card, and I'm fairly sure that you can do it online. We got the full discount on the accommodation, and another discount on the meal and drinks.

For a meal, it's worth insisting, if the card is declined -- I imagine not every member of the bar staff, especially new ones, might be used to handling them.

As far as I know, you don't have to use the card at the time of booking the accommodation -- at least, that's what we were told. As long as you have it, that's all that counts.

MDW1954

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Re: Marston's Interims.

#223159

Postby barchid » May 20th, 2019, 1:32 pm

Ayresome
I also used mine at Pitcher/Piano in Cornhill, twice in fact. Both times I needed to tell the staff it was a shareholder discount card but each time I was left wondering whether it was a ploy to discourage people using them.
I had a "very ordinary" lunch there the first time, so I went again to see if it was just my bad luck, but the 2nd visit was worse.
I think the discount was 20% but I've never used it since, because frankly, in EC2 there is no shortage of decent lunch venues and 20% off or not,a poor meal is a poor meal so why go ?
Pity because the place itself is quite pleasant to sit in, but not to eat in. I realise my view is subjective, but the give away is that they do not seem terribly busy. If they could up their game on the catering front in nice premises, with a great location, the figures would seem even more cheerful than they are for our first half.
They do brew very good beer though....

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Re: Marston's Interims.

#223165

Postby Dod101 » May 20th, 2019, 1:47 pm

Coming back to the investment case, yet another held dividend. It may be that in the longer term Marston's turns out to be a good investment but in the meantime for those who are living off their dividends (and that is the idea of a HYP) the age of austerity is still with us. Furthermore, a held dividend very often means a share price going nowhere. It sometimes gives a trading opportunity as the price meanders around but that is usually about it.

I do not hold.

Dod

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Re: Marston's Interims.

#223201

Postby Gan020 » May 20th, 2019, 3:58 pm

Dod101 wrote:Coming back to the investment case, yet another held dividend. It may be that in the longer term Marston's turns out to be a good investment but in the meantime for those who are living off their dividends (and that is the idea of a HYP) the age of austerity is still with us. Furthermore, a held dividend very often means a share price going nowhere.
Dod


In this case holding the dividend and the commitment to reduce debt has been a catalyst for an upward movement in the share price of around 10%, Underlying profits are and have been going up at Marstons, just not very quickly.

Also, the Board have said Marstons is reasonably immune to Brexit if that matters to you.

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Re: Marston's Interims.

#223365

Postby blobby » May 21st, 2019, 9:38 am

Dod101 wrote:Coming back to the investment case, yet another held dividend. It may be that in the longer term Marston's turns out to be a good investment but in the meantime for those who are living off their dividends (and that is the idea of a HYP) the age of austerity is still with us. Furthermore, a held dividend very often means a share price going nowhere. It sometimes gives a trading opportunity as the price meanders around but that is usually about it.

I do not hold.

Dod


Hi Dod,

I don't follow the logic here. Are you suggesting that as Marston's is holding their dividend, then people who are living off their dividends would do better elsewhere? I can't see many alternative shares with a 7% yield who are widely regarded as companies which will have sustained dividend growth into the future. If you sacrifice MARS for a company with the average dividend yield and perhaps a better regarded future then I think anyone living off their dividends may have an awfully long time to wait to catch up and in the mean time you really would be entering into the "age of austerity".

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Re: Marston's Interims.

#223399

Postby digitaria » May 21st, 2019, 11:18 am

I'd probably settle for a reliable 6.8% yield for a year or two, even if the share price flat-lined over that period.

However, looking at MARS, the level of debt keeps jumping out at me - it's about twice market cap. The interims make some noises about reducing it, but it remains somewhat eyewatering. GNK looks better in this respect, while the yield is a little lower.

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Re: Marston's Interims.

#223407

Postby kempiejon » May 21st, 2019, 11:51 am

digitaria wrote:I'd probably settle for a reliable 6.8% yield for a year or two, even if the share price flat-lined over that period.

However, looking at MARS, the level of debt keeps jumping out at me - it's about twice market cap. The interims make some noises about reducing it, but it remains somewhat eyewatering. GNK looks better in this respect, while the yield is a little lower.


Mars is a bit small for adding to my HYP and be excluded by the board guidelines below*. But for holders I'm sure MARS was once a 350 member and market cap has slipped down and out of the index? As you say Greene King in the is more HYPable. I also look at debt levels, gearing, profits and other metrics and MARS has too slim dividend cover for me.


*HYP Practical
For the HYP Practical board we define an HYP as a portfolio comprised exclusively of ordinary shares. If selected, such shares should have a dividend yield above the average for the FTSE100 index and be drawn from the constituents of the FTSE 350 index. At its simplest, it will have at least 15 holdings, none of which should be from the same sector.


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