HEAVITREE BREWERY PLC

Earnings Release • Jun 27, 2025

National Storage Mechanism | Additional information

RNS Number : 7276O

Heavitree Brewery PLC

27 June 2025

The Heavitree Brewery PLC

Trood Lane

Matford

Exeter EX2 8YP

Date:                    27 June 2025

Contact:               Terry Wheatley - Managing Director - 01392 217733

Nicola McLean - Finance Director/Company Secretary - 01392 217733

Patrick Castle /Anita Ghanekar - Shore Capital - 0207 408 4090

Following a meeting by a duly authorised committee of the Board of Directors held today, 27 June 2025, the Directors announce the interim results for the six months ended 30 April 2025.

Chairman's statement

Interim Results

In these uncertain times for us all, our pubs are thankfully reporting strong top line trading as our customers seek solace and comfort from the problems of the wider world in the inviting environments our operators work so hard to offer.  This has been aided by a prolonged period of good weather during spring which has boosted trading for the houses with outside dining and drinking areas and our beer and cider sales are both ahead of budget and the previous year.

In turn, the Company has recorded an increase in turnover of 3.62% at the half-year to £3,519,000 (2024: £3,396,000).  Operating profit of £524,000 is down by 4.02% against last year's figure for the corresponding period under review (2024: £546,000).  The decrease in operating profit is due to the increase in costs associated with the transition of Directors which took place in February.  The profit before taxation for the period is £1,507,000, an increase of 96.47% this increase includes the sale of non-core property assets, in particular the closed Locomotive Inn in Exeter which returned a profit on disposal of £1,055,000.

Dividend

The Directors are confident after the performance of the Company at the half-year and recommend the payment of an increased interim dividend at a rate of 2.75p (2024: 2.25p) per Ordinary and 'A' Ordinary share to those shareholders on the register on 11 July 2025.  The dividend will be payable on 01 August 2025.  This represents an increase of 22.22% on last year's interim dividend.

Property

The Locomotive Inn (as mentioned above) was sold during the period.  Also, the bungalow next to the Ley Arms in Kenn was sold and resulted in a loss on disposal of £1,654.  Together with a small loss on disposal of an inventory and a small profit on disposal of a vehicle, the total profit on the disposal of assets for the period was £1,047,000.

Planning permission for the rebuild of The Jolly Sailor in East Ogwell was determined in our favour, after many delays, on 9 April.  I look forward to reporting further on this project at the year-end.

Final Salary Pension Scheme.

The painfully slow wind-up process of the Company's final salary pension scheme continues.  The process is in the hands of the various insurance companies who are charged with transferring annuities into individual member's own names.  This transfer was successfully completed for four members during May by one provider, so there is some progress.  I shall report further at the year-end.

Prospects

A new American diner operation is to open in Exmouth later this month after an extensive rebranding and refurbishment.  We wish our new tenant's huge success with this exciting concept.  We have just two vacancies within the estate, both of which are open and trading while new tenants are being sought.  This is a pleasing position and gives the estate a strong foundation to make the best of the approaching summer.

It goes without saying that keeping our houses welcoming and busy helps to mitigate the cost head winds facing our sector.  April saw the implementation of living wage increases, a reduction in business rates support and the Employer's National Insurance percentage increases that were announced in the Chancellor's Autumn Budget.  Particularly aggrieving for pub operations was the lowering of the threshold at which National Insurance is applied which according to UK Hospitality "dragged an estimated ¾ million part-time and casual staff into this employer tax for the first time". 

N H P TUCKER

Chairman

Income statement (unaudited)

For the six months ended 30 April 2025

		6 months to 30 April 2025	6 months to 30 April 2024	Audited 12 months to 31 October 2024
	Note	£' 000	£' 000	£' 000
Revenue		3,519	3,396	7,498
Other operating income		109	106	294
Purchase of inventories		(1,346)	(1,281)	(2,982)
Staff costs		(745)	(694)	(1,505)
Depreciation of property, plant and equipment		(65)	(106)	(222)
Other operating charges		(948)	(875)	(1,659)
		(2,995)	(2,850)	(6,074)
Operating profit		524	546	1,424
Profit on sale of property, plant and equipment		1,047	300	308
Profit before finance costs and taxation		1,571	846	1,732
Finance costs		(64)	(79)	(172)
Profit before taxation		1,507	767	1,560
Tax expense		(376)	(192)	(242)
Profit for the period		1,131	575	1,318
Earnings per share - basic - diluted	4	23.3p            23.3p	11.9p          11.9p	27.2p         27.2p

Statement of comprehensive income (unaudited)

For the six months ended 30 April 2025

		6 months to 30 April 2025	6 months to 30 April 2024	Audited    12months     to  31 October       2024
		£' 000	£' 000	£' 000
Profit for the period		1,131	575	1,318
Items that will not be reclassified to profit or loss Fair value adjustment on investment in equity Actuarial (losses)/gains on defined benefit pension plans Tax relating to items that will not be reclassified		-      -	- -	- -
Other comprehensive income for the year, net of tax		1,131	575	1,318
Total comprehensive income attributable to: Equity holders		1,131	575	1,318

Balance sheet (unaudited)

at 30 April 2025		30 April 2025 £' 000	30 April 2024 £' 000	Audited 31 October 2024 £'000
Non-current assets
Property, plant and equipment		19,847	20,058	19,635
Financial assets		783	487	436
Deferred tax asset		16	16	16
		20,646	20,561	20,087
Current assets
Trade and other receivables		1,896	1,583	1,217
Inventories		10	10	10
Cash and short-term deposits		1,113	66	754
		3,019	1,659	1,981
Assets held for sale		-	29	504
Total assets		23,665	22,249	22,572
Current liabilities
Trade and other payables		(1,428)	(1,338)	(1,013)
Financial liabilities		(237)	(560)	(746)
Income tax payable		(723)	(454)	(347)
		(2,388)	(2,352)	(2,106)
Non-current liabilities
Other payables		(354)	(327)	(326)
Financial liabilities		(1,451)	(1,721)	(1,638)
Deferred tax liabilities		(875)	(852)	(875)
Defined benefit pension plan		(92)	(92)	(92)
		(2,772)	(2,992)	(2,931)
Total liabilities		(5,160)	(5,344)	(5,037)
Net assets		18,505	16,905	17,535
Capital and reserves
Equity share capital		251	251	251
Capital redemption reserve		686	685	686
Own share reserve		(1,023)	(1,044)	(1,049)
Fair value adjustments reserve		10	10	10
Retained earnings		18,581	17,003	17,637
Total equity		18,505	16,905	17,535

Dividends

The Directors  recommend a dividend of 2.75p to be paid at the half-year. ( 2024: 2.25p)

Statement of cash flows (unaudited)

for the six months ended 30 April 2025                                                            

		6 months to 30 April 2025	6 months to 30 April 2024	Audited 12months  to 31 October 2024
Operating activities		£' 000	£' 000	£' 000
# Profit/(loss) for the period		1,131	575	1,318
Tax expense		376	192	242
Net finance costs		64	79	172
(Profit) on disposal of non-current assets and assets held for sale		(1,047)	(300)	(308)
Depreciation and impairment of property, plant and equipment		65	106	222
Mortgage receipts received		18	15	33
(Increase)/decrease in trade and other receivables		(679)	(419)	11
Increase/(decrease) in trade and other payables		319	213	(73)
Cash generated from operations		247	461	1,617
Income taxes paid		-	-	(135)
Interest paid		(76)	(93)	(200)
Net cash  Inflow from operating activities		171	368	1,282
Investing activities
Interest received		12	14	28
Proceeds from sale of property, plant and equipment and assets held for sale		1,227	341	370
Payments to acquire property, plant and equipment		(316)	(940)	(1,138)
Net cash Inflow/(outflow) from investing activities		923	(585)	(740)
Financing activities
Preference dividend paid		(1)	(1)	(1)
Equity dividends paid		(186)	(170)	(277)
Consideration received by EBT on sale of shares		70	67	67
Consideration paid by EBT on purchase of shares		(44)	(69)	(75)
Capital element of finance lease rental payments		(27)	(20)	(29)
Repayment of bank borrowings		(147)	(99)	(246)
Other Loans		(400)	-	400
Net cash outflow from financing activities		(735)	(292)	(161)
Increase/(decrease) in cash and cash equivalents		359	(509)	381
Cash and cash equivalents at the beginning of the period		754	373	373
Cash and cash equivalents at the period end		1,113	(136)	754
Statement of cash flows (unaudited) (continued) for the six months ended 30 April 2025
Represented by:		6 months to 30 April 2025	6 months to 30 April 2024	Audited 12months  to 31 October 2024
Cash and short term deposits		1,113	66	754
Overdraft		-	(202)	-
Cash and cash equivalents		1,113	(136)	754

Reconciliation of movements in equity (unaudited)

6 months to	Equity	Capital	Own	Fair
30 April 2025	share	redemption	share	value	Retained	Total
	capital	reserve	reserve	adjustment	earnings	equity
	£' 000	£' 000	£' 000	£' 000	£' 000	£' 000
At 1 November 2024	251	686	(1,049)	10	17,637	17,535
Profit for the period	-	-	-	-	1,131	1,131
Other comprehensive income for the period, net of income tax	-	-	-	-	-	-
Total     comprehensive income for the period	-	-	-	-	1,131	1,131
Consideration received by EBT on sale of shares	-	-	70	-	-	70
Consideration paid by EBT on purchase of shares	-	-	(44)	-	-	(44)
Equity dividend paid	-	-	-	-	(187)	(187)
At 30 April 2025	251	686	(1,023)	10	18,581	18,505

Reconciliation of movements in equity (unaudited)

6 months to	Equity	Capital	Own	Fair
30 April 2024	share	redemption	share	value	Retained	Total
	capital	reserve	reserve	adjustment	earnings	equity
	£' 000	£' 000	£' 000	£' 000	£' 000	£' 000
At 1 November 2023	251	686	(1,041)	10	16,596	16,502
Profit for the period	-	-	-	-	575	575
Other comprehensive income for the period, net of income tax	-	-	-	-	-	-
Total     comprehensive income for the period	-	-	-	-	575	575
Consideration received by EBT on sale of shares	-	-	67	-	-	67
Consideration paid by EBT on purchase of shares	-	-	(69)	-	-	(69)
Loss by EBT on sale of shares	-	-	-	-	-	-
Equity dividend paid	-	-	-	-	(170)	(170)
At 30 April 2024	251	686	(1,044)	10	17,003	16,905

Reconciliation of movements in equity (unaudited) - continued

12 months to 31 October 2024 Audited	Equity share capital £000	Capital redemption reserve £000	Own share reserves £000	Fair value adjustment reserve £000	Retained earnings £000	Total equity £000
At 1 November 2023	251	686	(1,041)	10	16,596	16,502
Profit for the year	-	-	-	-	1,318	1,318
Other comprehensive income for the year net of income tax	-	-	-	-	-	-
Total comprehensive
income for the year	-	-	-	-	1,318	1,318
Consideration received by EBT on sale of shares	-	-	67	-	-	67
Consideration paid by
EBT on purchase of shares	-	-	(75)	-	-	(75)
Equity dividends paid	-	-	-	-	(277)	(277)
At 31 October 2024	251	686	(1,049)	10	17,637	17,535

Equity share capital

The balance classified as share capital includes the total net proceeds (both nominal value and share premium) on issue of the Company's equity share capital, comprising 5p Ordinary and 'A' Limited Voting Ordinary Shares.

Own share reserve

Own shares reserve represents the cost of The Heavitree Brewery PLC shares purchased in the market and held by The Heavitree Brewery PLC Employee Benefit Trust ('EBT'). Shares held at half-year 134,419 (2024: 146,957).

Notes to the interim results

1. Basis of preparation

These unaudited interim condensed financial statements have been prepared in accordance with IAS34 "interim financial reporting" and do not constitute statutory accounts as defined in section 434 of the Companies Act 2006.  They have been prepared on the basis of the accounting policies that were complied with in the annual financial statements for the year ended 31 October 2024 The accounting policies are drawn up in accordance with International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) as adopted by the United Kingdom.

These unaudited financial statements were approved and authorised for issue by a duly appointed and authorised committee of the Board of Directors on 27 June 2025.

2 .   Going concern

It has been a positive start to the year exceeding budget expectations. The extra burden on business continues with Living wage and  NI costs increasing for employers, this will continue to affect all areas of the hospitality industry and has been taken into account when forecasting for the second half of the financial year. The Company remains well within its forecasts to April 2026 with £3M overdraft available as at April 2025 and the term loan has been decreased in the year by £147k. The Board continues to focus attention on the long-term trading position of the Company.  The current trading performance of the Company also shows that it will be able to operate within the level of its facilities for the foreseeable future. With the value in the Estate being realised over time and with the support from the bank there are no material uncertainties. For this reason, the Company continues to adopt the going concern basis in preparing its financial statements.

3. Key Estimates

The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period are discussed below:

Impairment of assets

The Directors assess impairment of assets at each reporting date on a property by property basis. The Directors take into consideration trade performance during the year and open market value as to whether there is an indication that an asset may be permanently impaired.  When necessary external valuations are carried out. Within this trading period the Directors conclude that there were no impairments. 

4.  Basic and diluted earnings per share

The calculation of basic earnings per ordinary share is based on earnings of £1,131,000 (April 2024: £575,000), being profit after taxation for the period, and on 4,852,374 (April 2024: 4,822,277) shares being the weighted average number of Ordinary and 'A' Limited Voting Ordinary Shares in issue during the period after excluding the shares owned by The Heavitree Brewery PLC Employee Benefits Trust and those shares under option pursuant to the Employee Share Option Scheme. Employee share options could potentially dilute basic earnings per share in the future but are not included in the interim calculation of dilutive earnings per share because they are antidilutive for the period presented. The Ordinary Shares and the 'A' Limited Voting Ordinary Shares have equal dividend rights and therefore no separate calculation of earnings per share for the different classes has been given.

5.  Segment information

Primary reporting format - Business segments

The primary segmental reporting format is determined to be business segments as the Company's risks and rates of return are affected predominantly by differences in the products and services provided.

During the year the Company operated in one business segment-leased estate.

Leased estate represents properties which are leased to tenants to operate independently from the Company.

6.  Interim report

Copies of this announcement are available from the Company at Trood Lane, Matford, Exeter EX2 8YP. The Company's interim report for the six months ended 30 April 2025 has been posted to shareholders today and will be available on our website at www.heavitreebrewery.co.uk.

Ends.

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