LONDON -- Investors in Enterprise Inns (LSE: ETI ) had little to cheer today as its chief executive blamed a snowy January and unseasonably cold spring weather for a tough start to the pubco's financial year.
The inclement weather kept regulars and drinkers away from the chain's 6,000 leased and tenanted pubs, causing pre-tax profit to dip by 9 million pounds to 55 million pounds for the half year to March 31. Enterprise's like-for-like net income on its total estate was also down by 4.2%.
Debt fell by 200 million pounds to 2.7 billion pounds as the group continued with its long-term plan to dispose of unprofitable pubs from its property portfolio as part of its long-term debt-reduction strategy. It guided that debt would decrease further to 2.5 billion pounds by the year-end.
Also of note was the demise of Waverley -- Enterprise's wines and spirits distributor -- back in October 2012. This resulted in the direct loss of some 2 million pounds in trading income to the business.
Commenting on the results, chief executive Ted Tuppen said:
Trading in the first half of the year has been particularly challenging. The heavy snowfalls in January and the coldest spring for many years have not encouraged customers to venture out to their local pub. Against this backdrop we are satisfied with the results for the first half of the financial year and are encouraged that in recent weeks we have seen a recovery in trade. Our target continues to be the delivery of like-for-like net income growth across the entire estate during the second half of this year.
Enterprise's shares, which currently trade on a forward P/E of 5.1 fell 0.9% to 99 pence today. They've risen some 46% over the past 12 months. Of course, whether they represent a buy at this price, given that recent run-up and today's interim results, is something only you can decide.
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