UK’s second largest tenanted pub owner, Enterprise Inns has successfully signed a £625m refinancing deal with its bankers. The news helped raise its share price by 9% in the share market.
Even though the new arrangement will start next year in May 2011 after the current one is complete. The company has been able to raise £135m till the month of March but it is still under a debt of around £3.4bn, which is less than £3.56bn at the start of the year. The company’s half-yearly profits fell from £104m to £86m.
Ted Tuppen, Chief Executive stressed that the company continues to generate strong cash flows and has sold off underperforming assets. The company has already sold 261 pubs in the first half of the year for £86 million and aims to sell 500 pubs in the complete year.
He maintained that the business environment continues to be daunting but hoped that the Government will take steps to support the hospitality industry.
The company had been deeply impacted due to global recession, as households seriously reduced discretionary spending. Increasing tax rates and costs had also dented profits.
The company feels that a good performance by British team in the football world cup can lead to a lot of revenue for the company in the coming days. Analysts also expect the company to post a better performance in the coming times.
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