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Posted: 21 May 2014
Replacement – Trading update
This announcement replaces the announcement that was made on 19 May 2014 under RNS reference 4123H. The only change relates to the trading period with the 39 weeks to 29 March 2014 being changed to the 44 weeks to 3 May 2014. All other details in the announcement remain the same.
Shepherd Neame (“the Company”), the Kent-based brewer and pub operator, will be announcing its results for the 52 weeks ending 28 June 2014 in September 2014. Since the Company last reported its performance, trading has continued to be strong through the spring months, reflecting the benefit of investing consistently in our pubs and brands, and the favourable weather conditions.
For the 44 weeks to 3 May 2014, we have seen an excellent performance across our pub estate with Tenanted like-for-like EBITDAR up +4.1%, average EBITDAR per tenanted pub up +6.0% and like-for-like sales in our Managed Houses up by +8.8%.
Total beer volume, for the 44 weeks to 3 May 2014 was down -0.3% following the termination of brewing bottled Kingfisher lager in October 2013. The core own and licensed portfolio grew by +6.0%. This reflects a continued strong performance in our portfolio and good growth in the recently launched Whitstable Bay range.
Following on from the success of the major redevelopment of the Marine Hotel, Whitstable in 2013, the Fayreness Hotel, Kingsgate has been fully refurbished and renamed The Botany Bay Hotel. The hotel opened on 22 March 2014 and trading to date has been ahead of expectations.
As previously announced, the Company has invested in a new water treatment plant which will minimise the consumption of extract well water through greater recycling. This plant is now being commissioned and is necessary as we near the end of a long-term agreement with our local water company.
The Company is in dispute regarding the terms on which the long-term agreement will terminate and any residual liabilities under it owed by the Company. The Board is of the view that there should be no material liability for the Company in this respect. The dispute resolution procedure in the long-term agreement is arbitration. In the absence of a consensual resolution to this dispute, there is a possibility that arbitration could commence. It is estimated that the Company's legal and associated costs of an arbitration case could be up to £750,000. The Company would seek to reclaim these costs as part of the arbitration process.
The Board is confident in delivering results for the 52 weeks ending 28 June 2014 in line with market expectations.