NewRiver Retail updates on pub estate management and development: Property company NewRiver Retail has updated on progress in transferring pubs it acquired from Marston’s four years ago to its own management albeit outsourced to LT Management – it originally signed a four-year management contract with Marston’s which comes to an end next month. NewRiver retail stated: “In October 2013, we acquired a portfolio of 202 pubs from Marston’s (Trent portfolio). Each pub in the portfolio was handpicked by management for its high roadside visibility, high passing footfall and prominent location, with the intention of converting a significant number for retail/residential use. The pubs in the portfolio traded strongly, with high occupancy and strong income returns, and consequently in August 2015 we acquired a second portfolio of 158 pubs from Punch Taverns (the Mantle portfolio). We have since sold 15 pubs and closed nine for convenience store conversion meaning we now have 336 pubs remaining in our portfolio. At the time of the Trent portfolio acquisition, we signed a four year leaseback agreement with Marston’s, which comes to an end in December 2017. We put in place a structured programme to transfer the management of the Trent pubs to the management of NewRiver and LT Management, and through a detailed estate review, involving all relevant stakeholders, we split the transfer into small batches in order to manage the programme effectively and minimise disruption to trade. Throughout the programme our high quality in-house team of pub specialists have visited each site and worked with the publicans to ensure a smooth transition. Pleasingly, the majority of publicans have chosen to remain in their pubs following the transfer and our operations managers and instructed solicitors will ensure that new leases and tenancies are implemented seamlessly. For the minority of pubs where the publican intends to vacate, we will utilise our tried and tested lettings programme to recruit high quality publicans who will continue to grow the business. Throughout the transfer programme we have worked closely with Marston’s to ensure that the process has run as smoothly as possible. We were active in negotiating the transfer of a number of pubs in advance of the deadline, which meant that at the start of the period we had 123 Trent pubs to transfer. During the period we transferred a further 57 pubs, with an additional tranche of 38 completed post period end. We are on track to transfer the management of the remaining 28 pubs in December.” Of its own performance in the First Half, Paul Roy, Chairman, said: “I am pleased to report another successful and highly active period for NewRiver across all aspects of the business, as we continue to build a strong platform to deliver growing cash returns. In the capital markets, we have put down important foundations for the future. We raised £225 million of equity at a substantial premium to net asset value, and completed the transitional move from secured to unsecured borrowing by raising £430 million of unsecured facilities, providing us with increased flexibility and maturity at a reduced cost. Despite a more challenging environment, we continue to be encouraged by the long-term trends we are seeing across our convenience and community-focused retail and leisure portfolio. Convenience is a key driver for our customers and their frequent spend on non-discretionary items makes us resilient to the growth of online, as well as fluctuations in the consumer economy over the long-term. Looking ahead, with our well positioned convenience-led community-focused portfolio and financial capacity, we are confident in our ability to continue to deliver growing cash returns to our shareholders.”

SSP Group reports sales and profit growth: SSP Group, the operator of food and beverage outlets in travel locations worldwide, has reported revenue of £2,379.1m, up 11.7% at constant currency, and 19.5% at actual exchange rates for the year ended 30 September 2017. Underlying operating profit was £162.9m, up 27.0% at constant currency, and 34.2% at actual exchange rates. Like-for-like sales were up 3.1% driven by growth in air passenger travel and retailing initiatives. Underlying profit before tax of £148.7m, up 38.3%. Reported profit before tax of £144.8m, up 37.1%. It plans a special dividend of circa £100m and share consolidation. Kate Swann, chief executive of SSP Group, said: “SSP has delivered another good performance in 2017. Operating profit was up 27.0% at constant currency, driven by good like-for-like sales growth, substantial new contract openings and further operational improvements. We have grown our presence across the world, particularly in North America and Asia and we are pleased with the performance of our new business in India. We have invested significant capital in the business this year, our highest to date, and at the same time we are returning cash to shareholders. The new financial year has started in line with our expectations and, whilst a degree of uncertainty always exists around passenger numbers in the short term, we continue to be well placed to benefit from the structural growth opportunities in our markets.” The company added: “The financial performance of the group is presented on an underlying basis, for which the statutory reported results are adjusted for the impact of foreign exchange, the amortisation of intangible assets created on the acquisition of the SSP business in 2006 and the revaluation of the obligation to acquire an additional share of TFS by the end of calendar year 2018. The group delivered a strong financial performance in 2017, with underlying operating profit increasing by 27.0% (on a constant currency basis) to £162.9m, and with a constant currency increase, excluding TFS, in the operating margin of 50 bps. The consolidation of TFS added a further 30 bps, bringing the group margin to 6.8%. Total revenue increased by 11.7% on a constant currency basis, including like-for-like sales growth of 3.1%, net contract gains of 6.0% and a negative impact of 0.3% from the additional leap year day in 2016. TFS contributed a further 2.9% to revenue. Like-for-like growth in the air sector has again been stronger than the rail sector, driven by increasing passenger numbers in most of our markets. Net contract gains were 6.0% in the full year, an encouraging increase from last year’s gains of 1.7%. Over the year we saw very strong contributions from North America and the Rest of the World, reporting net gains of c. 23% and 18% respectively. Significant new unit openings in airports at Chicago Midway and JFK T7 in North America, and in Hong Kong and China in the Rest of the World, have contributed to this strong performance. We continue to focus on retaining profitable contracts and our contract renewal rate in 2017 was in line with historical levels. During the year we won a number of significant new contracts, including at airports in Seattle, Los Angeles and Boston in North America, and in Cebu in the Philippines. We expect to begin operating these contracts progressively over the next two years. The strong operating margin improvement of 50 bps reflects the like-for-like sales growth and further encouraging progress on our strategic initiatives. This result was slightly ahead of our expectations, due to the stronger like-for-like sales growth in the second half and the fact that some unit redevelopments (and corresponding closure periods and pre-opening costs) which were expected to take place in the second half have been deferred into the new financial year. We delivered strong free cash flow of £89.0m, after investing £115.0m in capital expenditure (excluding capital contributions), which was a £19.1m increase on the prior year. The increase in capital expenditure reflects the growth in net gains. Reported net debt fell from £317.4m to £262.2m. The reduction in net debt was driven by the free cash flow of £89.0m, net of the dividend payment of £29.0m.”