PUNCH TAVERNS PLC
(“Punch” or “the Group”)

Enhanced quality of estate drives profit improvement

Punch Taverns plc, the UK’s leading pub operator of over 8,400 leased, tenanted and managed pubs, today announces interim results for the 28 weeks ended 1 March 2008.

Highlights

Financial Results (before exceptional items)

• Results reflect 9% reduction in size of estate, following non-core divestments in 2007
• Profit before tax increased 1% to £133 million (2007: £132 million)
• Basic earnings per share up 1% to 39.0p (2007: 38.5p)
• Interim dividend up 8% to 5.5p (2007: 5.1p)
• Strong cash generation with free cash flow before investment of £129 million (2007: £55 million)
• Strong balance sheet, increased interest cover to above 2.0x, no refinancing requirements before December 2010 at the earliest

Statutory Results (after exceptional items)*

• Profit before tax of £109 million (2007: £138 million)
• Basic earnings per share of 32.7p (2007: 42.9p)

Operational Performance

• Quality of estate continues to improve
  • Average EBITDA per pub up 10% in the leased estate
  • Licensees continue to perform well with average licensee profitability up 11% to £40k
  • Average EBITDA per pub up 4% in the managed estate
  • Continued investment with £84 million spent on enhancing over 950 pubs across the leased and managed estates
• On target to achieve c.£10m of cost savings in the current financial year 

Giles Thorley, Chief Executive of Punch Taverns plc, commented
 
“It is testament to the operational and estate strategy implemented over the past two years that we have delivered underlying profit growth with a significantly smaller estate. This strong performance has been achieved despite a weaker trading environment across the industry.

“Measured on both a company EBITDA per pub basis and licensee profitability metrics our estate is of significantly higher quality than this time last year.  Moreover, the Group’s finance is secure, long-term and at a fixed rate, underpinning the financial stability of the Group.

“Whilst we remain cautious over short-term trading conditions for the sector, we are confident that we are well positioned as we move into a more positive environment over the summer months and pass the anniversary of the smoking bans in England and Wales.” 

Full results are available in the Investor Room - click here.

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