Tonight:
9°c
Marston's gets the banks' thumbs-up
10.12.08
There was rare good cheer from the pubs sector today as Marston's showed it still has the confidence of its lenders.
In an industry awash with red ink and debts, Marston's has proved resilient. Today it said it has extended its bank facility with six lenders by three years to 2013, leaving its debt with the longest distance to maturity of any pub company.
Finance director Paul Inglett said the deal allowed a more "flexible financing structure". Mark Brumby at Blue Oar Securities said: "While it would be unseemly to gush, this is really excellent news. It signals the banks' confidence in Marston's cashflows."
The company recently caused controversy by holding its final dividend at 8.47p. Investors were grateful, but analysts wondered whether it would have been wiser to hold on to the cash.
Profits for the year to October were down 20% to £76.2 million.
Analysts said the debt refinancing removed uncertainty surrounding the stock by making it clear that the company plans to keep paying a divi, as long as trading doesn't collapse.
Rivals Punch Taverns and Mitchells & Butlers did not pay a dividend this year.
