Ei Group, the pub operator being bought by Slug and Lettuce owner Stonegate, reported that earnings dropped this year after the disposal of 354 venues.
Revenue was up 4.17 per cent from £695m to £724m, in the 12 months to 30 September.
Earnings before interest, tax, depreciation and amortisation slumped from £282m to £268m.
The company reported a loss after tax of £209m from a profit of £72m last year, and a basic loss per share of 46.2p, from earnings per share of 15.2p.
Why it is interesting
In January Ei Group announced the sale of a large chunk of its 412-strong commercial pub portfolio to Tavern Propco, a newly-incorporated private fund owned by Davidson Kempner Capital Management in a deal worth £348m.
The pub operator, which was formerly known as Enterprise Inns, said the money would reduce its debt pile and provide shareholder returns.
The sale came ahead of an offer by Stonegate Pubs, which also owns Walkabout and Yates, to buy Ei Group for £1.3bn. The offer, which has been been approved by shareholders, is currently under the first stage of investigation by the Competition and Markets Authority.
The deal is expected to complete in the first quarter of next year, subject to regulatory approval.
What Ei Group said
Chief executive Simon Townsend said: “Since 2015 our strategy has been to develop optionality across our asset estate and to strengthen the balance sheet through deleveraging.
“The completion of the disposal of 354 commercial properties during the year demonstrated this strategy, growing value through the transfer of assets to their optimum use and then unlocking that value through monetisation.
“The disposal realised embedded value and provided us with the opportunity to accelerate our debt reduction plans as well as returning capital to our shareholders.
“The approach by Stonegate to acquire the business is recognition of the strength of our strategy and the value of our high quality pub estate.
“Stonegate has indicated its intention to continue our strategy of improving the quality of the estate following completion of the acquisition, by ensuring the right consumer proposition is available in each of its pubs supported by the best people, utilising the optimum operating model.”
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