Fuller's takes on JD Wetherspoon, warning of "significant" Brexit risk

William Turvill
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Fuller's describes Brexit as a "significant risk", but one that can be mitigated (Source: Getty)

Pub chain Fuller’s has gone head to head with rival JD Wetherspoon by warning a Brexit would be a “significant risk to the viability of the business”.

But Fuller, Smith and Turner, which today reported a rise in profits and revenue in the year to 26 March, has said it will have in place plans to mitigate the risk.

Fuller’s stance on the EU referendum is in sharp contrast to Wetherspoon's, whose chairman Tim Martin is campaigning for a Brexit. The pub chain last month printed 200,000 beer mats calling for a vote to Leave.

Read more: The boss of JD Wetherspoon is campaigning for Brexit in his pubs

The figures

Fuller, Smith and Turner’s share price remained fairly steady on Friday morning at 1,074p after it reported a rise in turnover and profits.

Its adjusted pre-tax profit was £40.9m, up from £36.4m in the year to March 2015.

Its revenue, meanwhile, was up nine per cent year on year to £350.5m.

The group also reported earnings before interest, taxation, depreciation and amortisation (ebitda) of £65m, up 11 per cent.

Its annual dividend was up eight per cent to 17.9p.

Read more: Will these new Brexit beers help you decide how to vote?

Fuller, Smith and Turner Fuller, Smith and Turner | mobile image

Why it's interesting

With the EU referendum coming up later this month, Fuller's has joined a long line of businesses expressing concerns over a Brexit.

However, the company believes its “long-term perspective” gives it the “flexibility to react accordingly”.

Fuller’s said a Brexit is considered a “significant risk to the viability of the business” but added its directors have put in place a model to mitigate the risk.

On the risk, it said: “Fuller's has strong relationships with EU customers and suppliers which could be customised in the event of an exit from the EU. Fuller's existing training and development programme would enable the Group to produce and attract quality employees from a reduced market workforce.

“The extensive scenario planning and analysis performed as part of our business viability exercise enables the impact of an exit from the EU to be mitigated.”

What the company said

Chief executive Simon Emeny added:

It has been another outstanding year for the company and I am delighted to be reporting an excellent set of results, particularly in the largest part of our business - our managed pubs and hotels...

As we look forward to the year ahead, we know that our long-term strategy, combined with the vision to address the needs of our customers and consumers of the future, will keep Fuller's on the path of growth. By continuing to invest in our assets, our brands and, most importantly, our employees, we will continue to build a Fuller's that delivers outstanding service to our customers, excellent careers for our people and good returns for our shareholders.

In short

Fuller, Smith and Turner believes it had an "outstanding" year. But, in terms of the future, the "economy is difficult to read with the European referendum imminent".

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