Marston's FD Q&A: brewing up a storm

It was a very wet summer. How much did the flooding cost you and is
that the end of it?
The biggest impact we’ve seen was during the two lots of flooding during June
and July. For the 10 weeks to the end of July, for example, we had
like-for-likes which were negative by just over 2%. That, together with the cost
of the repairs relating to the flooding of about £2m, probably knocked about £4m
off the group’s profits as a result. I’m pleased to say that’s all now behind us
and we’ve taken the costs relating to that flooding in the 2007 accounts.

What, for you, were the financial highlights of this set of
results?
We’ve seen another year of double-digit increases in earning per share, assisted
by the £120m of share buybacks we did during the year. We’ve also had a 20%
increase in the dividend, and a revaluation gain of £162m from revaluing the
majority of our pub estate. Since the year-end, we’ve successfully completed a
major refinancing on very competitive terms in what’s been a very difficult
credit market.

You’ve recently refinanced your debt and raised an additional £330m.
What was the reason for doing this now?
We’ve been able to refinance about £330m of debt much more efficiently and at a
much lower cost of debt than the bank finance that it replaced. As a result,
we’ve got an all-in cost of debt now of just over 6%. It’s all at fixed rates,
so we’ve got no exposure to the volatile credit markets.

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