Fuller’s to raise cash after burning through £5m every month in lockdown

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The pub group Fuller, Smith & Turner has revealed that revenues fell 80% during the past year on the back of coronavirus lockdowns as it seeks to raise cash to see it through the reopening of UK hospitality.

The company said it had burned through between £4m and £5m for every month of full lockdown, when its pubs and hotels were forced to close.

The pubs sector has been among the hardest hit during the pandemic, with restrictions in place since late March 2020 that have ranged from total bans on opening to curfews and requirements to sell “substantial meals” with drinks. Fuller’s said its pubs will have been closed on 73% of the days between 30 March 2020 and 12 April 2021.

Fuller’s plans to raise about £54m via a share placing to give it enough cash to spend on the reopening of British pubs as well as to ride out any potential delays if the government decides it is still too risky to ease restrictions.

Simon Emeny, Fuller’s chief executive, said the company had entered the pandemic in strong shape financially, partly because of the January 2019 sale of its brewery, which makes London Pride ale, to Japan’s Asahi after 174 years in the business. However, the pandemic cash burn meant the company needed money to train staff and take advantage of an expected sales surge once pubs reopen, he said.

“It’s been a really challenging 12 months [but] I can really see the skies opening up. I feel really optimistic,” Emeny said.

“We’re seeing a lot of evidence of pent-up demand,” he said, including 60,000 bookings for outdoor seating.

“Everything we’re hearing about the vaccine rollout is that it continues to be a huge success.”

The government has not given any sign that it will deviate from its plans to allow a phased reopening of pubs and restaurants in England starting on 12 April. At first, only those pubs with outdoor seating areas will be allowed to reopen and all orders must be made while sitting at a table. From 17 May, hospitality venues will be allowed to seat up six people or two households indoors, while all restrictions are planned to be lifted on 21 June.

Fuller’s plans to reopen 195 tenanted and directly managed pubs on 12 April, followed by another 200 on 17 May.

Emeny said he expected that continued restrictions on international travel – which could last longer during the summer even as the vaccination programme rolls out – will be “very positive for UK pubs”.

Business Matters Magazine

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