Over 40 years’ heritage
185,800 clients worldwide
Over 15,000 markets

Punch Taverns under pressure to impress investors

When Punch Taverns reports its full-year figures analysts are estimating revenue of £442 million and an operating profit of £188 million.

A bartender in a pub
Source: Bloomberg

Punch Taverns is trading at 9.5p, and the share price has fallen 26% since the pub operator reported a widening in its first-half loss to £174.9 million in April. In the first half of 2014 the company incurred one-off costs of £224.6 million, the majority of which were from capital restructuring. The company announced a 4% increase in its profits per pub in the first six months of the year, and stated it remains on track to deliver its full-year expectations.

In May it announced a capital restructuring plan which left shareholders with a 15% stake in the company and the remaining 85% owned by bondholders. This large equity dilution drove the share price from 14p to 10p overnight. Now that the capital restructuring has been put to be bed the company can focus on the operational side of the business.

If Punch Taverns can prove its capital structure is secure and the business is improving the stock could target 11.6p.

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.