Two thirds of pubs to open by end of July
Liquidity secured for the foreseeable future
Shepherd Neame ("Shepherd Neame" or "the company") is pleased to announce that, following the lifting of restrictions on hospitality businesses by the Government, we expect to re-open at least two thirds of our pubs by the end of July. Further, the Company's financial position has been strengthened with the agreement of a
Re-opening in July
During this time, the safety and wellbeing of our team members, licensees, and customers have and continue to be our overriding priority.
We welcome the Government COVID-secure guidance issued on 23 June, in particular the "1 metre plus" rule on social distancing. It is still necessary to adapt the normal operation of our pubs with greater emphasis on pre-booking and table service, as well as making the necessary changes to the physical layout to comply with guidance. But, these guidelines do provide a degree of flexibility for pub operators to adapt their individual outlets.
We expect that at least 45 managed pubs out of a total of 69, and 165 tenanted and leased pubs out of a total 239, will reopen by the end of July.
It is encouraging to note the way that hospitality industries have started to recover in other countries where restrictions have already been lifted, but few have yet to recover to match prior year revenues in full.
The Company has welcomed the
Over the past three months, the Company has been run very tightly, minimising cost and preserving cash through every available avenue including the cessation of all non-contractual capital expenditure in the brewery and pub estate, the minimisation of all expenditure to the lowest level possible, and the use of Government assistance. Where the Company is the lessee, we have entered into negotiations with the landlords, and the majority of these negotiations have had a positive outcome. The Board of Directors took a temporary 20% pay reduction. No cash bonuses will be paid this year and there will be no pay increases across the company.
Throughout this period, the brewery has continued to produce beer for our supermarket and export customers and has seen a substantial increase in sales which has provided a vital source of revenue and cash for the business.
The Company will continue to be managed carefully and prudently as it opens for business again.
Liquidity secured into 2022
The Board is pleased to announce that its banking lenders Lloyds Bank plc and Santander UK plc have agreed to increase the Group's overall debt facilities utilising the
As part of the arrangements, the Company's loan note holder
The Group's net debt position at the end of June is anticipated to be c.
The terms and conditions of the new financing prohibit the payment of dividends by the Group whilst the facility and alternative covenants remain in place. The Company will not be paying a dividend in October 2020 nor an interim dividend in
It would be usual for the Company now to fix the date of its final results and therefore the AGM. Due to the reporting complexities arising from the pandemic it is likely that the AGM will be later than usual. To limit cost and adhere to Government guidance it is also anticipated that it will be in a different format this year. Further details will be announced in due course.
Jonathan Neame, CEO, Shepherd Neame said:
"This is the first time in the Company's long history of over 300 years that our business has been interrupted. As a strong independent family business with a significant local presence, we have tried to do the right thing for our team and our community. We have a clear strategy, a well-balanced business and now a robust financing structure in place to see us on the path to recovery. We are optimistic that we have a strong long term future as and when this pandemic subsides.
"Our whole team cannot wait to welcome our customers back to our unique and wonderful pubs over the next few weeks."
Shepherd Neame Tel: 01795 532206
Jonathan Neame, Chief Executive
Mark Rider, Finance and IT Director
Instinctif Partners Tel: 07831 379122
This information is provided by RNS, the news service of the