Brait final results March 2019
Loss for the year was recorded at EUR708 million (2018: EUR700 million) whilst headline loss per share came to EUR139 cents per share (2018: headline loss of EUR138 cents per share).
With the economic outlook in our markets unlikely to change in the near future, Brait is focused on achieving operational efficiencies and implementing strategies aimed at ensuring the portfolio is in the best possible position as and when conditions improve.
For the investment portfolio:
*Virgin Active's strong volume growth continues, setting a solid platform to deliver good revenue and mid-upper single digit EBITDA growth for 2019. The group is focused on delivering on its global strategy: "To deliver feel good exercise experiences at a time and place convenient to you". This entails improving group exercise, personal training and digital experiences, which will translate into improved member retention and yields, increasing membership, revenue and EBITDA.
*Premier continues its margin management and cost saving programmes, having recently completed a head office restructure to simplify the business. Capex investment will continue to be directed at low-risk, strategic projects targeting growth in its core operations and driving returns through operating efficiencies. This includes the optimisation of the bakery footprint to align capacity with demand. Premier remains alert to potential value enhancing acquisitions to enter new categories and/or geographies.
*Iceland's focus is to continue growing sales and enhancing the success of its fast-growing online business and unique home delivery service. The rollout of Food Warehouse stores continues, targeting the 100th opening in July 2019, with the programme of Iceland fascia store refits focused on the capex light 'mini refits' centred on clusters in specific areas. Liquidity remains strong with capital expenditure planned to decrease year-on-year to ensure net debt continues to decrease. Iceland plan to repay the outstanding GBP45 million Fixed Rate Notes due 2020 with internally generated cash before their maturity date. Iceland continues to focus on investing for the long-term success of the business.
*New Look's materially deleveraged balance sheet and more flexible capital structure provides a stable operating platform. Strengthened liquidity provides sufficient resources to accelerate investing in the business, with no significant near-term maturities providing a runway for management to focus on long term growth. Considerable progress has been made hereby in delivering on its well-defined turnaround measures, positioning it well to respond to challenges and grasp opportunities.
For Brait, the focus remains on positioning itself to resume the previous success in growing NAV per share, through:
*Materially reducing debt on Brait's own balance sheet and increasing cash flow to Brait from its portfolio
*Enhancing organic growth in Virgin, Premier and Iceland and execution of New Look's turnaround strategy
*Preparing for the redemption and repayment of Brait's Bonds, due September 2020, from internally generated cash flows, portfolio realisations and partially from a possible new bond issue
*Positioning for a new acquisitive phase by the end of this period to achieve a wider investment spread primarily focused on consumer facing and industrial investments mainly in our chosen geographies of South Africa and the UK.
Executing on these plans should result in growth in NAV driven by portfolio company performance and a reduction of the discount of Brait's share price to the reported NAV per share.