Marston's (MARS) H2 2024 earnings summary

Executive summary

• 2024 marked a pivotal year with the sale of the CMBC stake, enabling a sharper focus on core hospitality operations and simplification of the business.

• Achieved strong like-for-like revenue growth of 4.8%, outpacing the market, and significant progress on operational and guest satisfaction metrics, with a reputation score of 800.

• Five key value drivers underpin the strategy: operating model excellence, differentiated formats, digital transformation, management model expansion, and targeted acquisitions.

• Recurring free cash flow reached £44 million, supported by robust operational progress and strategic value drivers.

Financial highlights

• Revenue increased 3% year-over-year to £899 million, including disposals, with LFL sales consistently outperforming the market.

• EBITDA rose 13% to £193 million, with EBITDA margin up 190 bps to 21.4%.

• Operating profit grew 17.9%, and pub operating profit margin improved by 210 bps to 16.4%.

• Profit before tax reached £42 million, a 65% increase, and EPS grew 49% to £0.052.

• Net debt reduced to £884 million, a 27% reduction since 2022, achieving the target ahead of schedule.

Outlook and guidance

• Like-for-like sales for the first six weeks of FY 2025 up 3.9%; Christmas bookings ahead of last year.

• Committed to 200-300 bps EBITDA margin improvement over the medium term and targeting recurring free cash flow over £50 million per annum.

• CMBC disposal expected to reduce annual interest expense by approximately £18 million.

• Expecting to offset increased employment costs in FY 2025 through productivity and energy efficiencies.