JT Davies & Sons Holdings Limited, the parent company of Henley based pub operator Brakspear, has reported an increase in turnover for the year ending 31 December 2023 against 2022, with an expected reduction in profitability. Turnover was up 9% to £38.6m (2022: £35.4m).
Brakspear chief executive Tom Davies reflected on the year,
“Our business performed very well in 2023, with a high level of stability across our leased and tenanted estate and our Honeycomb Houses managed business driving the organic sales growth.”
Underlying EBITDA was reported as £10.9m, slightly lower than the £11.2m reported for 2022 when the company benefitted from a business interruption claim amounting to £0.7m. Davies added, “Whilst I am generally happy with our profitability levels, our profit conversion has reduced because of the well documented cost pressures which affected our customers and directly impacted the operation of our pubs.”
Adjusted profit before tax (adjusted for property revaluations and disposals) was unchanged at £7.2m in 2023 (2022: £7.2m).
Net debt reduced by 22% to £17m (2022: £22m) resulting from bank debt repayments during the year amounting to £3.8m and an increase of £1.2m in cash reserves at year end. Davies commented, “Our balance sheet grows from strength to strength, enabling us to realise our ongoing ambition to add a significant number of high-quality pubs to our L&T and managed portfolios”.
The company continued to invest in its estate with £5.3m of capital and operating expenditure directed towards its pubs. This included the £1.8m redevelopment of The White Bear in Warlingham, Surrey that reopened in January 2024 as the company’s tenth Honeycomb Houses site, and £0.8m invested in The Leicester Arms, a tenanted pub in Penshurst, Kent. In addition, there were smaller refurbishments across the L&T and Honeycomb estates.
During 2023 there were no pub acquisitions, and one sale, of The Reformation near Reading, which had been closed for several years.
Davies commented, “I am very proud of the achievements of our business partners in the L&T estate, and of the contribution from our teams in Honeycomb Houses and at head office. Together we continue to deliver exceptional results in a time of significant challenges, which we continue to face.” On the subject of challenges, he added, “I look forward to the Government delivering on its promise to reform the unfair and unfit business rates regime, which is long overdue.”
