Applegreen Reports 73% Revenue Increase In First Half Results
Published on Sep 20 2019 9:48 AM
Applegreen plc has reported a 73% revenue increase in the first half of 2019 to €1.5 billion, its latest financial results show.
Group gross profit increased by 145% to €268 million during the period, according to its interim results for the six months ended 30 June 2019.
The roadside retailers adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) increased by 204% to €58.9 million in the first half of 2019 compared to €19.4 million during the same period last year.
The integration of Welcome Break, which it acquired in October 2018 is going well, the group said.
Applegreen's adjusted EBITDA, excluding Welcome Break, increased by 37% to €26.5 million, the report showed.
"Like for like revenue and profits from the underlying Applegreen estate, excluding Welcome Break, continued to show strong growth, whilst significant progress was made on the integration of the Welcome Break business acquired in the UK in Q4 last year," Bob Etchingham, CEO said.
The delivery of anticipated synergy benefits is firmly on track and we see the opportunity for greater savings than originally expected going forward."
Etchingham said that the Welcome Break business has seen growth in core catering but trading was soft during the first quarter in peripheral revenue streams.
"Traffic volumes and turn-ins continued to grow but a slight fall in conversion rates reflects weakened consumer confidence. Post period end, the key summer period demonstrated the resilience of Welcome Break, trading satisfactorily despite the uncertain political and macro-economic conditions."
The group recently announced two significant acquisitions in the US.
"A portfolio acquisition of 46 sites located in Minnesota, Wisconsin and Michigan further expands Applegreen's footprint to this region," he said, "whilst our interest in a consortium acquisition of the Connecticut Service Plazas concession represents a significant strategic step in growing our presence in the US and establishing Applegreen as a recognised operator of larger Service Area sites on strategic road networks."
Following the Welcome Break acquisition, new brand partners include Starbucks, Waitrose, WH Smith, KFC, Pizza Express, Harry Ramsden and the Ramada and Days Inn hotel brands.
These are in addition to existing brands including Burger King, Subway, Costa Coffee, Greggs, Lavazza, Chopstix, Freshii and 7-Eleven, some of which also have an existing presence on the Welcome Break network.
Etchingham concluded: "Our primary focus in the immediate term remains the delivery of further synergy benefits from Welcome Break, which we now expect to be significantly larger than our previous expectation, and the integration of recent US acquisitions, whilst continuing on the deleveraging trajectory for the Group."
The group now operates 483 sites in the Republic of Ireland, the United Kingdom and the United States.
© 2019 Checkout – your source for the latest Irish retail news. Article by Donna Ahern. Click subscribe to sign up for the Checkout print edition.