J D Wetherspoon
Annual Report 1998

Plain-text annual report

A N N U A L R E P O R T 1 9 9 8 J D W E TH E RS P O O N P L C 0 J D Wetherspoon plc develops, owns and manages pubs, and aims to have them in strategic positions throughout the UK. They are excellently maintained, and the Company’s priorities are to provide its customers with a clean, safe and attractive environment in which to enjoy good value, high quality food and drink served by friendly and well trained staff. Highlights of the year Turnover up 35% to £188.5m Profits before tax up 15% to £20.2m* Earnings per share up 14% to 9.9p* Dividend per share increased by 10% 68 new pubs opened Capital investment of £122.0m Creation of a further 1572 jobs * Excluding exceptional items J D W E T H E R S P O O N P L C Chairman’s statement Sales £m 188.5 139.4 100.5 68.5 46.6 94 95 96 97 98 Operating Profit £m 28.4 22.9 17.0 12.2 8.8 94 95 96 97 98 Results I am pleased to report another year of advancement for the Company, both in terms of our financial results and our strategy of building a major independent pub chain. Turnover increased by 35% to £188.5 million. Profit before tax (excluding exceptional items) was up 15% to £20.2 million and earnings per share rose by 14% to 9.9p. Capital spending for the year amounted to £122.0 million and net gearing at the year end was 82%. Interest was covered 3.5 times by operating profits. Operating margins before depreciation, interest, sale and leaseback rentals and tax were 21.2% compared with 22.5% last year mainly as a result of higher labour charges and a slight reduction in gross margin. Free cash flow, after capital investment of £9.4 million in existing pubs, and expenditure in respect of tax, interest and dividends improved by 2% to £25.8 million, resulting in cash flow per share of 13.2p before investment in new pubs and loan repayments. Cashflow increased at a lower rate than profits as a result of an unusally high level of investment in existing pubs, and interest charges resulting from our expansion. Capital expenditure on existing pubs is expected to decline from 5% of sales in the year under review to approximately 3% of sales in the current year. Dividends The Board proposes, subject to shareholders’ consent, to pay a final dividend of 1.45p net, bringing the total dividend for the year to 2.20p, a 10% increase on the previous year. At this level, dividends will be covered 4.5 times compared to 4.3 times in 1997. A scrip alternative will again be offered to shareholders. 2 J D W E T H E R S P O ON P L C J D W E T H E R S P O O N P L C 0 The Liberty Bounds City of London Overlooking The Tower of London, this converted bank increased our presence in central London. Pictured here are Managers Berni and Pete Canning, together with Stuart, Scott, John and Nicki. Head run on 0 J D W E T H E R S PO ON P L C Chairman’s statement continued Number of Pubs 252 194 146 110 87 94 95 96 97 98 Profit before Tax and exceptional items £m 20.2 17.6 13.1 9.7 6.5 94 95 96 97 98 Further Progress We opened 68 pubs in the year, an increase of 20 on the previous year, bringing the total open at the year end to 252. 20 of the new openings took place in July so their contribution in the year to 2 August 1998 was minimal. The new openings were widely spread throughout the country including 12 in Greater London. Encouraging sales levels were achieved in both larger and smaller towns and cities and in suburban areas reflecting the popularity of Wetherspoon pubs across broad sections of the community. Our existing pubs achieved like-for-like sales growth of 2.2%, reflecting strong growth in the first half of the year and a flat performance in the second half, resulting, in particular, from a decline in bar sales during the five weeks of the football World Cup. The Company is continuing its efforts to improve all areas of the business. For example, a major project has been undertaken to improve the availability and use of information technology in the business, especially in our pubs. Considerable efforts are also being made in the area of design to create pubs which enhance their individual locality and architecture. In this connection, the Company has received awards or commendations for its pub designs in Stafford, Tunbridge Wells, Derby, Blackburn and Bristol. We also continue to upgrade services to customers and are, for example, introducing a new menu in October. Finance As well as organic cashflow of £25.8m, the Company raised £33 million in the year through sale and leaseback transactions, giving rise to a property profit of £15 million. At the year end, the Company had unused bank facilities of £80 million. In view of the good reception for our sales and leasebacks, the Company intends to consider further such transactions in the future. The Board As announced in our Interim Report, the Company welcomed Jim Clarke to the Board as Finance Director during the year. Jim was previously Finance Director of David Lloyd Leisure, part of Whitbread Plc. 4 J D W E T H E R S P O ON P L C J D W E TH E R S P O O N P L C 0 Head run on The Acorn Litchfield The Company’s expansion into central England continued with The Acorn, named after a favourite local pub no longer in existence. Featured here are Rachel Leach, Manager, and Maxine Lewis, Shift Manager. 0 J D W E T HE R S PO O N P L C Chairman’s statement continued Number of Employees 5538 3966 3045 1660 1101 94 95 96 97 98 Dividend per Share (p) 2.2 2.0 1.8 1.6 1.3 94 95 96 97 98 People Wetherspoons’ continuing strong growth reflects the exceptionally hard work and motivation of all colleagues in the Company and I would like to thank them sincerely, as well as our suppliers and our customers. Prospects Like-for-like sales in the period since the year end decreased by 1% reflecting a slow first fortnight followed by an improving trend. Overall Company sales are substantially ahead of last year. The Company obtained licensing permission for 91 new pub sites in the year compared with 56 in the previous year. 7 pubs have opened since the year end, 44 developments are now in the course of construction and licences have been granted for an additional 36 new pubs. The supply of new sites in our pipeline continues to grow. The background to the market which we currently face provides Wetherspoons with excellent opportunities for growth. Whereas our industry remains competitive, I am confident that our winning formula, developed over the last 19 years, will enable us to benefit from this environment. As a result of our strong existing estate of pubs, our accelerated programme of new pub developments and our dedicated team, I look forward to another year of good progress for the Company. Tim Martin Chairman 15 September 1998 6 J D W E T HE R S PO O N P L C J D W E TH E RS P O ON P LC 0 Head run on Heathrow and Gatwick Airports Wetherspoon continued to build a significant presence at both major airports with the opening of a third site at Heathrow, Wetherspoons at Terminal 2 and also The Village Inn, Gatwick Airport. Featured here ar e Village Inn Managers, Lisa and Richard Harris. 0 J D W E T H E R S P O O N P L C Finance Director’s report for the year ended 2 August 1998 Adjusted EPS (p) 9.9 8.7 6.7 4.9 3.6 94 95 96 97 98 Free Cash Flow £m 25.4 25.8 19.1 10.9 4.2 94 95 96 97 98 Shareholder returns Earnings per share excluding exceptional items increased from 8.7p in 1997 to 9.9p, a rise of 14%. The Board has proposed a final dividend of 1.45p giving a total for the year of 2.2p, which, following the five for one share split effected on 6 November 1997, is equal to an increase of 10%. Dividend cover (before exceptional items) increased from 4.3 times to 4.5 times, reflecting the Company’s wish to preserve cash for future expansion, and this was aided in the year by a scrip dividend take-up of 32%. Cash flow and investments The Company’s cash flow from operations but before financing costs, tax and investments in existing pubs, continued to strengthen, and at £47.1 million for the year represented 166% of operating profit. The strength of this ratio underlined the cash generative nature of the business. After payments to providers of debt and equity finance, by way of interest and dividends, of tax, by way of advanced corporation tax on dividends and investment in the ongoing refurbishment and enhancement of existing pubs, the Company generated free cash flow of £25.8 million. 1997/98 was a significant year in terms of investment in new pubs with a cash outflow of £104.5 million, an increase of 66% on the previous year. This additional investment reflects the higher rate of pub openings in the year, up from 48 to 68. It is also reflected in the level of expenditure at the balance sheet date on unopened properties which totalled £42.6 million. The higher level of new pub investment is reflected in the proportion of this investment funded from free cash flow which reduced from 40% in the previous year to 25% this year. The balance of this investment was funded through external bank financing and sale and leaseback transactions as outlined below. 8 J D W E T H E R S P O O N P L C J D W E TH E RS P O ON P LC 0 Head run on The Billiard Hall West Bromwich This development is an example of a more contemporary design and demonstrates the individuality that Wetherspoon brings to its pubs. Pictured here are Manager, Ashley Lloyd and Shift Manager, Stephen Boddie. 0 J D W E T HE R S PO O N P L C Finance Director’s report continued Capex £m 122.0 69.1 49.8 38.7 23.2 94 95 96 97 98 Shareholders Funds £m 159.2 124.7 108.1 79.2 72.4 94 95 96 97 98 Investment in existing pubs and head office totalled £9.4 million in the year which represented 5% of sales. This is higher than in previous years due to an unusually high level of refurbishment and also significant levels of investment in information technology. Average depreciation per pub was £52,000 compared with average capital investment for refurbishment and improvements, including major refurbishments, of £37,000. Liquidity and funding At 1 August 1997, net borrowings amounted to £88.6 million, and rose by £42.3 million during the year to close at £130.9 million. With the increased level of capital investment, net gearing rose from 71% to 82%, with shareholders’ funds at year end of £159.2 million. Interest payable, net of interest receivable, was £8.2 million, an increase of 53% on 1997, reflecting the use of debt in the funding of new pubs. Interest cover was 3.5 times. External loan facilities at the start of the financial year totalled £125 million and a further facility of £100 million was agreed in December 1997. This new facility is repayable over 11 years, 60% by instalments over the term and 40% by payments in the final two years. As at 2 August 1998, £20 million of this facility had been drawn. In the first six months of the financial year under review, the Company agreed a sale and leaseback transaction on one of its freehold pubs which generated £3.9 million of cash proceeds. During the second half of the year, a further sale and leaseback transaction was completed covering 14 freehold trading outlets and generating £29 million of cash proceeds on a rental of £2 million per annum. This transaction allowed the Company to recover its total cash investment in these pubs and benefit from conditions in the property market which makes these transactions possible at attractive yields. The use of transactions of this nature will continue to be reviewed as part of the overall development of the Company’s financing strategy. 10 J D W E T HE R S P O O N PL C J D W E TH E R S P O O N P L C 0 Head run on 0 J D W ET HE R S P O O N P L C Hoylake Lights Hoylake Designing individual pubs to suit their location is demonstrated in this Merseyside development with emphasis on unusual architectural features. Pictured here is pub Manager Richard Carvell. Finance Director’s report continued Dividend Cover 4.5 4.3 3.7 3.1 2.6 The Company will continue to use debt for the funding of a proportion of the new pub development programme, and in view of this the Board considers it appropriate to obtain fixed interest rates on a high proportion of the Company’s outstanding borrowings in order to limit the risk of interest rate changes in the short term. 94 95 96 97 98 Interest Cover 4.9 4.4 4.3 3.8 3.5 94 95 96 97 98 Bank loans totalling £110 million have been fixed for a period between 3 and 5 years. Taxation The effective rate of tax for the year excluding exceptional items was 3.6%. As in previous years, no mainstream corporation tax charge arose due to the availability of high levels of capital allowances generated by the Company’s substantial capital investment programme. Based on the Company’s expansion plans, it is anticipated that the effective rate of taxation in forthcoming years will be significantly lower than the mainstream corporation tax rate, although this will be subject to the level of previous years’ allowances currently under negotiation with the Inland Revenue. At 2 August 1998, approximately £3.2 million of unutilised advance corporation tax, previously written off in the accounts, was available for offset against future mainstream tax liabilities. Accounting policies and standards There were no pronouncements by the Accounting Standards Board during the year that affected the Company’s reported results. Jim Clarke Finance Director 15 September 1998 12 J D W ET HE R S P OO N PL C J D W E T H E R S P O O N P L C 0 Head run on Penderel’s Oak London WC1 Opened on the site of the old Meteorological Office, this pub is popular with the local legal community. Featured here are Managers Sarah and Steve Strange. 0 J D W E T H E R S PO O N P L C Directors, officers and advisers Tim Martin Chairman Aged 43 John Hutson Managing Director Aged 33 Jim Clarke Finance Director Aged 38 A law graduate of Nottingham University, he was called to the bar in 1980. He founded the business in 1979 and became Chairman in 1983. Appointed 1996. A politics graduate from Exeter University, he joined the Company in 1991 and became Operations Director in 1996. He has previously worked with Allied Domecq plc. Appointed 1998. A graduate in economics and accountancy from Stirling University, he qualified as a Chartered Accountant in 1984. He previously worked with David Lloyd Leisure (a division of Whitbread plc) and HP Bulmer Holdings plc. Rosalyn Schofield Legal Director and Company Secretary Aged 42 Appointed 1997. A law graduate from Hull University, she joined the Company as an assistant solicitor in 1991 and became head of the department and Company Secretary in 1994. Mark Davies Operations Director Aged 39 Suzanne Baker Commercial Director Aged 35 Appointed 1997. A graduate in management science, from Kent University, he joined the Company in 1991 as an area manager, becoming Director of Retail in 1996. Appointed 1997, having joined the Company in 1992 as Catering Development Manager and been appointed Director of Marketing in 1995. She has previously worked with Grand Metropolitan plc. 14 J D W E T H E R S P O O N PL C J D W E TH E RS P O ON P L C 0 Directors, officers and advisers continued Brian Jervis Non-Executive Aged 63 Tony Lowrie Non-Executive Aged 56 John Herring Non-Executive Aged 40 Appointed 1991. Member of the Audit Committee and Chairman of the Remuneration Committee. Appointed 1987. Chairman of the Audit Committee and member of the Remuneration Committee. Appointed 1997. Member of the Audit Committee and member of the Remuneration Committee. Brian Jervis, a Chartered Secretar y, is a consultant and a former Director of John Govett & Co. Limited. Tony Lowrie is Chairman of ABN AMBRO Asia Securities Limited. John Herring, a Chartered Accountant, is managing director of G de Z Capital Limited, a venture capital organisation, and was previously a director of Kleinwort Benson Securities Limited. Registered Office Wetherspoon House Central Park Reeds Crescent Watford WD1 1QH Company Number 1709784 Registrars Computershare Services plc Registered Auditors PricewaterhouseCoopers Valuers Christie & Co. Solicitors Macfarlanes Bankers The Royal Bank of Scotland plc Bank of Scotland National Westminster Bank plc Clydesdale Bank plc The Bank of Nova Scotia Financial Advisers Dresdner Kleinwort Benson Limited Stockbrokers Dresdner Kleinwort Benson Securities Limited 0 J D W E T H ER S P O O N P L C J D W E T H E RS P O O N P L C 15 Public houses nationwide River Thames Woking Pubs in Greater London/M25 area At the end of July 1998, the number of pubs nationwide was 252 16 J D W E T H E R S P OO N PL C A list of all our pubs can be found on pages 41 to 47. Financial accounts Contents Directors’ report 18 Report of the Remuneration Committee 22 Report of the auditors 23 Profit and loss account 24 Statement of total recognised gains and losses 24 Note of historical cost profits 24 Cash flow statement 25 Balance sheet 26 Notes to the financial statements 27 Financial record 39 Information for shareholders 40 J D W E T H E R S P O O N P L C 17 Directors’ report for the year ended 2 August 1998 The Directors present their report and the audited financial statements for the year ended 2 August 1998. Principal activities and business review The principal activities of the Company are the development and management of public houses. Details of progress are given on pages 2 to 12. Results and dividends The profit on ordinary activities for the year including exceptional items after taxation amounted to £34,407,000 an increase of 205% on the 1997 result of £16,796,000. The Directors recommend that a final dividend of 1.45 pence per share be paid in cash or by way of scrip dividend to all shareholders on the Register of Members on 25 September 1998, bringing the total dividend for the year to 2.2 pence per share compared with a 1997 total of 2.0 pence per share. The final dividend will be paid on 2 December 1998. Profit retained for the financial year amounted to £30,086,000 and will be transferred to reserves. Directors The Directors listed on pages 14 and 15 served throughout the financial year, with the exception of Ms Baker, Mr Davies and Ms Schofield, each of whom were appointed on 4 September 1997 and Mr Clarke, who was appointed on 10 March 1998. Mr Hutson and Mr Lowrie will retire by rotation and Mr Clarke, having been appointed by the Directors since the last Annual General Meeting, will also retire. All three Directors will offer themselves for re-election. Details of the terms under which the Directors who were in office during the year serve, their remuneration, and their interests in shares of the Company are given in the Report of the Remuneration Committee on page 22 and in note 3 to the financial statements. No Director has any material interest in any contractual agreement subsisting during or at the end of the year which is or may be significant to the Company. Insurance against the liabilities of Directors and Officers of the Company was in place throughout the year. 18 J D W E T HE R S P O O N PL C Company’s shareholders Details of the Company’s shareholders, including those beneficial interests notified to the Company as accounting for over 3% of the issued share capital, are given on page 40. Directors’ responsibilities The Directors are required by UK company law to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit or loss for that period. In preparing the financial statements, the Directors confirm that suitable accounting policies have been used and applied consistently and that reasonable and prudent judgements and estimates have been made. They also confirm that applicable accounting standards have been followed and the financial statements have been prepared on the going concern basis. The Directors are responsible for maintaining proper accounting records, for safeguarding the assets of the Company, and for taking reasonable steps to prevent and detect fraud and other irregularities. Corporate governance The Board supports the Code of Best Practice issued by the Cadbury Committee (the Code) and has complied with it throughout the past year. The Board intends to comply in full with the Principles of Good Governance and Code of Best Practice prepared by the Hampel Committee and appended to the Listing Rules (the Combined Code) throughout the year to 1 August 1999. Our auditors have reported to the Company that in their opinion, the Directors’ comments on going concern below provide the disclosures required by paragraph 4.6 of the Code, and the Directors’ comments on internal financial control below appropriately reflect the Company’s compliance with paragraph 4.5 of the Code (both as supplemented by the related guidance). They have reported to the Company that in their opinion, the statements in respect of both are not inconsistent with the information of which they are aware from their audit work on the financial statements, and the above statement appropriately reflects the Company’s compliance with the other paragraphs of the Code specified by the London Stock Exchange for their review. They have not carried out the additional work necessary to, nor do they express any opinion on, Directors’ report continued the effectiveness of either the Company’s system of internal financial control or its corporate governance procedures, nor the ability of the Company to continue in operational existence. Going concern In accordance with Section 4.6 of the Code and paragraph 12.43(v) of the Listing Rules of the London Stock Exchange, the Directors have made enquiries into the adequacy of the Company’s financial resources, through a review of the Company’s budget and medium term financial plan, which includes capital expenditure plans and cash flow forecasts, and have satisfied themselves that the Company will continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the Company’s financial statements. Internal financial control The Directors are responsible for the Company’s system of internal financial control, which is designed to provide reasonable but not absolute assurance against material misstatement or loss. The Company has an established framework of internal financial controls, including: n a comprehensive budgeting process, with a detailed operating plan for twelve months and a mid-term financial plan having been approved by the Board. Business results are reported weekly for key items and monthly in full, and compared to budget. Forecasts are prepared regularly throughout the year, for review by the Board. n clearly defined authority limits and controls are in place over cash handling, purchasing commitments and capital expenditures. An internal audit function monitors the control of cash and stock in operating units. n complex treasury instruments are not used. Decisions on treasury matters are reserved for the Board. As required by paragraph 4.5 of the Code, the Audit Committee has reviewed the effectiveness of these key financial controls in operation, and will continue to do so in the current year. Employment policies Only through the skill and commitment of the Company’s employees will its objectives be met. All staff are encouraged to make a real commitment to the Company’s success, and to progress to more senior roles as they themselves develop. A heavy emphasis is placed on training programmes for all levels of staff, which highlights the importance placed by the Company on providing service to its customers. In selecting, training and promoting staff, the Company has to take into account the physically demanding nature of much of its work. In this context, all decisions are based on merit and without reference to gender, marital status, race, age or disability. Internal communications seek to ensure that staff are well informed about the Company’s progress, through the use of regular newsletters, monthly videos and briefings at staff meetings. All staff participate in incentive bonus schemes related to profitability and/or service standards, and qualify to receive share options after six months’ service with the Company. Policy on payment of suppliers The Company agrees terms and conditions with suppliers before business takes place, and has a policy of paying agreed invoices in accordance with the terms of payment. On average, trade creditors at the year end represented 50 (1997: 49) days’ purchases. Year 2000 The Company has established a steering group to oversee the review of all issues arising from Year 2000. The review includes a detailed assessment of all computer systems and equipment that rely on software or processing that may be affected by the change of century as well as confirmation from key suppliers, customers and other business relationships that they have adequately addressed this issue as it affects their dealings with the Company. The Board are regularly updated on progress made. J D W E T H E R S P O O N P L C 19 Directors’ report continued A plan to repair and test all non-compliant systems has been put in place with estimated costs to completion of £0.8 million. New systems development already scheduled and which will be capitalised in line with the Company’s normal accounting policy accounts for £0.6 million of this spend. All other costs, primarily user testing and the costs of system changes purely to ensure Year 2000 compliance, will be written off to the profit and loss account. Total costs to date are £0.4 million and £0.4 million is expected to be spent in the next financial year. We anticipate that nearly all key work will have been completed by early 1999. Introduction of the Euro The Directors have considered the implications of the introduction of the Euro on the activities of the Company. At present, there are no transactions carried out in foreign currencies and therefore it is not anticipated that there will be any material impact or expenditure arising from the introduction of the Euro. Political and charitable contributions Contributions made by the Company during the year for charitable purposes were £315 (1997:£382). No political contributions were made. Auditors Our auditors, Coopers and Lybrand, merged with Price Waterhouse on 1 July 1998, following which Coopers and Lybrand resigned and the directors appointed the new firm, PricewaterhouseCoopers, as auditors. A resolution to reappoint PricewaterhouseCoopers as auditors to the Company will be proposed as the Annual General Meeting. Special Business at the Annual General Meeting Enclosed with this document is a notice convening an Annual General meeting of the Company for 3 November 1998, at which shareholders will be asked, as items of special business, to approve resolutions to authorise the Directors to allot shares, to give power to the Directors to disapply the pre-emption requirements of Section 89 of the Companies Act 1985, to give the Directors authority to put in place a scrip dividend alternative, to adopt the new 1998 Share Option Scheme and to adopt the new 1998 Sharesave Scheme. 20 J D W E T HE R S P O O N PL C Authority to allot The general authority previously given to the Directors to allot “relevant securities” will expire at the end of the Annual General meeting convened for 3 November 1998. Accordingly Resolution 7 as set out in the Notice of Meeting will be proposed to authorise the Directors (pursuant to Section 80 of the Companies Act 1985) to allot Ordinary shares in the capital of the Company up to a maximum nominal amount of £460,000, being approximately 11.7% of the nominal value the Ordinary shares currently in issue. The authority (unless previously varied, revoked or renewed) will expire on the earlier of 15 months from the date of passing of the resolution or the conclusion of the Annual General Meeting held to approve the Report and Accounts for the year ending 1 August 1999. The Directors will exercise such authority to allot only when satisfied that it is in the interests of the Company to do so. They have no present intention, however, of exercising the authority, except in connection with the issue of shares under the Company’s share option schemes and scrip dividend scheme. Disapplication of pre-emption rights The provisions of Section 89 of the Companies Act 1985 (which, to the extent not disapplied, confer on shareholders rights of pre-emption in respect of the allotment of “equity securities” which are or are to be paid up in cash other than by way of allotment to employees under an employees’ share scheme) apply to the authorised but unissued Ordinary shares of the Company to the extent that they are not disapplied pursuant to Section 95 of the Companies Act 1985. The existing disapplication of these statutory pre-emption rights will expire at the end of the Annual General Meeting convened by the Notice of Meeting. Accordingly, Resolution 8 as set out in the Notice of Meeting will be proposed as a special resolution to permit Directors to allot shares without the application of these statutory pre-emption rights, first, in relation to rights issues and, secondly, in relation to the issue of Ordinary shares in the capital of the Company for cash up to a maximum aggregate nominal amount of £196,550 (representing approximately 5% of the nominal value of the Ordinary shares of the Company currently in issue). Directors’ report continued The authority (unless previously varied, revoked or renewed) will expire on the earlier of 15 months from the date of passing of the resolution or the conclusion of the Annual General Meeting held to approve the Report and Accounts for the year ending 1 August 1999. Scrip dividend authority The Directors would once again like to be able to offer shareholders (other than certain overseas shareholders) the right to elect to receive new Ordinary shares as an alternative to cash in respect of all or any part of the dividend to be declared by the Company at the Annual General Meeting convened by the Notice of Meeting and also in respect of any other dividends as may be lawfully paid or declared by the Company or the Directors on or at any time after the date of that Annual General Meeting and prior to the date of the Annual General Meeting to be held to approve the Report and Accounts for the year ending 1 August 1999. Full details of this scrip alternative, including the reasons why the Directors consider it to be attractive to shareholders and advantageous to the Company and the basis of allotment of shares under it, are set out in the Scrip Dividend Circular to shareholders. The existing mandate scheme (pursuant to which shareholders may put in place a standing mandate to receive new Ordinary shares as an alternative to cash in respect of any dividends for which a scrip dividend alternative is offered) will continue to be available and details of it are set out in the Scrip Dividend Circular. Resolution 9 as set out in the Notice of Meeting is required to be passed by the Company’s Articles of Association to permit the Directors to offer a scrip dividend alternative for the dividend to be declared by the Company at the forthcoming Annual General Meeting and also in respect of any other dividends as may be lawfully paid or declared by the Company or the Directors on or at any time after the date of that Annual General Meeting and prior to the date of the Annual General Meeting to be held to approve the Report and Accounts for the year ending 1 August 1999. Share Option Schemes This scheme which is proposed to be adopted by Resolution 10 as set out in the Notice of Meeting, has been designed by the Remuneration Committee and is similar to the existing Executive Share Option Scheme which it replaces. However, in addition to normal options it allows super options to be granted. In accordance with institutional investor guidelines, any super options will be subject to long-term stringent performance criteria. The main features of this new Scheme are summarised in the Appendix to the Notice of Annual General Meeting. 1998 Sharesave Scheme This Scheme which is proposed to be adopted by Resolution 11 as set out in the Notice of Meeting, is a replacement for the existing SAYE Scheme but, in line with legislative changes, this new Scheme now includes a facility to grant options linked to a three year savings contract in addition to the five and seven year savings contract. The main features of this new Scheme are summarised in the Appendix attached to the Notice of Annual General Meeting. By order of the Board Rosalyn Schofield Company Secretary 15 September 1998 J D W E T H E RS P O O N P L C 21 Report of the Remuneration Committee for the year ending 2 August 1998 The Company’s policy on the granting of share options under its employee share schemes is to distribute them widely across the Company’s pub managers, shift managers and long serving bar staff as well as its head office staff. In this way, the Company seeks to encourage and motivate those key employees who have direct interface with the public. The Company’s non-executive Directors are appointed on an annual basis and do not participate in the Company’s bonus and share option schemes. Their fees are determined by the executive Directors following consultation with professional advisers. The executive Directors are employed on rolling contracts requiring the Company to give one year’s notice of termination, whilst the Director may give six months’ notice, save for Tim Martin who must give one year’s notice. The non- executive Directors hold their positions pursuant to letters of appointment with terms of twelve months. Details of the emoluments of individual Directors, and of the shareholdings of and options granted to Directors are given in note 3 to the financial statements. Brian Jervis Non-executive Director 15 September 1998 The Committee comprises the three non- executive Directors and the executive Chairman, and is chaired by Brian Jervis. The main provisions of the Code of Best Practice of the Greenbury Committee have been incorporated in or annexed to the Listing Rules of the London Stock Exchange. The Company complies with the Best Practice provisions concerning remuneration committees given in Section A annexed to the Listing Rules, save for the fact that the executive Chairman is a member of the Committee. The Committee believes that it derives benefit from the Chairman’s membership and that it conducts its affairs with this composition without detriment to the principles of the Best Practice provisions. The Committee confirms that in framing its remuneration policy for Directors, it has given full consideration to the Best Practice provisions contained in Section B annexed to the Listing Rules. The remuneration and emoluments of executive Directors and senior executives of the Company are set by the Committee, although the executive Chairman plays no part in the setting of his own remuneration. The aim of the Company’s remuneration policy is to provide the packages required to attract, retain and motivate Directors and senior executives of high quality. Salaries and other benefits are determined annually after a review of the performance of the individual, by reference to industry and other comparisons and consideration of reports from specialist consultants. It is the policy of the Company to operate bonus arrangements at all levels of staff that are performance related, the primary performance measures being profitability and operating standards. The Company makes contributions to personal pension schemes on behalf of certain of its executive Directors and senior executives. It does not operate a defined benefit pensions scheme. 22 J D W E T H E R S P O O N P L C Report of the auditors to the members of J D Wetherspoon plc We have audited the financial statements on pages 24 to 38. Respective responsibilities of directors and auditors As described on page 18 the Company’s Directors are responsible for the preparation of financial statements. It is our responsibility to form an independent opinion, based on our audit, on those statements and to report our opinion to you. Basis of opinion We conducted our audit in accordance with Auditing Standards issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the Directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Company’s circumstances, consistently applied and adequately disclosed. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. Opinion In our opinion the financial statements give a true and fair view of the state of affairs of the Company at 2 August 1998 and of its profit, total recognised gains and cash flows for the year then ended and have been properly prepared in accordance with the Companies Act 1985. PricewaterhouseCoopers Chartered Accountants and Registered Auditors London 15 September 1998 J D W E T HE R S P O O N PL C 23 Profit and loss account for the year ended 2 August 1998 Notes Before Exceptional Items 1998 £000 Exceptional Items £000 After Exceptional Items 1998 £000 1997 £000 Turnover from continuing operations 188,515 - 188,515 139,444 Operating profit Profit on disposal of tangible fixed assetts Net interest payable Profit on ordinary activities before taxation Tax on profit on ordinary activities Profit on ordinary activities after taxation Dividends 2 5 6 7 8 9 Retained profit for the year 28,367 - (8,202) 20,165 (726) 19,439 (4,321) 15,118 - 14,968 - 14,968 - 14,968 - 14,968 28,367 14,968 (8,202) 35,133 (726) 34,407 (4,321) 30,086 22,939 0 (5,373) 17,566 (770) 16,796 (3,894) 12,902 Earnings per Ordinary 2p share 10 9.9p 7.6p 17.5p 8.7p Statement of total recognised gains and losses Profit for the financial year after taxation U n realised surplus on revaluation of pro p e rt i e s Total recognised gains relating to the year Note of historical cost profits Reported profit on ordinary activities before taxation Realisation of property revaluation gains of previous years Difference between historical cost depreciation charge and the actual depreciation charge of the year calculated on the revalued amount Historical cost profit on ordinary activities before taxation Historical cost profit for the year retained after taxation and dividends 24 J D W E T HE R S P O O N PL C Notes 20 1998 £000 34,407 2,086 36,493 1998 £000 35,133 (772) 494 34,855 29,808 1997 £000 16,796 1,673 18,469 1997 £000 17,566 0 423 17,989 13,325 Cash flow statement for the year ended 2 August 1998 Notes 1998 £000 £000 1997 £000 £000 Net cash inflow from operating activities 11 47,116 47,116 38,596 38,596 Returns on investments and servicing of finance Interest received Interest paid Net cash outflow from returns on investment and servicing of finance Taxation Advance corporation tax paid Corporation tax paid Capital expenditure Purchase of tangible fixed assets for existing pubs Proceeds of sale of tangible fixed assets Investment in new pubs and pub extensions 351 (9,058) 220 (5,910) (8,707) (8,707) (5,690) (5,690) (434) (150) (584) (9,377) 35,443 (104,483) (584) (9,377) (656) - (656) (4,223) 0 (63,010) (67,233) (656) (4,223) Net cash outflow from capital expenditures (78,417) Equity dividends paid (2,626) (2,626) (2,598) (2,598) Net cash outflow before financing (43,218) (37,581) Financing Issue of ordinary shares Advances under secured bank loans Repayments of secured bank loans Net cash inflow from financing Increase/(decrease) in cash Free cash flow Cash flow per Ordinary 2p share 12 13 10 10 939 48,833 (1,000) 48,772 5,554 976 30,000 (1,000) 29,976 (7,605) 25,822 13.2p 25,429 13.1p J D W E T H E RS P O O N P L C 25 Balance sheet at 2 August 1998 Fixed assets Tangible assets Current assets Investments Stocks Debtors Cash Notes 1998 £000 1997 £000 14 15 16 334,695 244,513 286 3,195 11,385 12,750 27,616 - 2,215 3,026 7,196 12,437 Creditors due within one year 17 (62,564) (34,998) Net current liabilities Total assets less current liabilities (34,948) (22,561) 299,747 221,952 Creditors due after one year 18 (140,555) (97,289) 159,192 124,663 3,931 62,000 22,843 70,418 3,898 59,676 22,023 39,066 159,192 124,663 19 20 20 20 20 Capital and reserves Called up share capital Share premium account Revaluation reserve Profit and loss account Equity shareholders’ funds The financial statements on pages 24 to 38 were approved by the Board on 15 September 1998 and signed on its behalf by: Tim Martin Jim Clarke Directors 26 J D W E T HE R S P O O N PL C Notes to the financial statements for the year ended 2 August 1998 1 Principal accounting policies The financial statements have been prepared in accordance with applicable Accounting Standards in the United Kingdom. A summary of the more important accounting policies, which have been applied consistently, is set out below. Basis of accounting The financial statements are prepared in accordance with the historical cost convention modified by the revaluation of freehold and leasehold property. Turnover The Company’s operations comprise one class of business, which is pub retailing in the United Kingdom, and turnover excludes Value Added Tax. Tangible fixed assets Tangible fixed assets are stated at cost or valuation less accumulated depreciation. Depreciation is calculated so as to write off the cost or valuation of a fixed asset on a straight line basis over its estimated useful life, taking into account expected residual values, based on prices prevailing at the date of acquisition or subsequent valuation, using the following rates: Freehold buildings 50 years Leasehold land and buildings Renovations of properties already trading, fixtures and fittings, computer equipment Lower of life of lease or 50 years At rates from 10%-33% pa Depreciation on fixtures and fittings commences when the relevant public house begins trading. Valuation of properties Trading properties are revalued professionally by independent valuers on a rolling basis ensuring that no valuation is more than three years old. Any temporary valuation difference arising is adjusted through the revaluation reserve. Where a diminution in value arising in the year is regarded as permanent, the provision is charged to the profit and loss account, to the extent that it does not relate to an existing revaluation surplus. Interest and pre-opening costs The majority of costs incurred in the preparation of properties for use in the business, including interest on borrowings, are capitalised. Capitalisation of such costs ceases when the relevant public house commences business. Stocks Stocks are held for resale and are stated at the lower of invoiced cost and net realisable value. Deferred taxation Deferred taxation is provided on accelerated capital allowances and other timing differences, only to the extent that it is probable that a liability will crystallise. Pensions The Company makes contributions to defined contribution personal pensions schemes, the costs of which are accounted for as they become due. Operating leases The costs of operating leases in respect of land and buildings and other assets are charged on a straight line basis over the lease term, except where on acquisition of a property a reverse premium, capital contribution or rent free period is granted by the lessor. Where such amounts arise, they are released to profit from the date on which the pub opened through to the date of the first rent review to market value, usually on the fifth anniversary of the lease. Where a sale and leaseback arrangement is established at fair value and results in an operating lease, any profit or losses is recognised immediately. Interest rate swaps Interest rate swaps are used to manage exposure to fluctuating interest rates. Income and expenditure arising from swap transactions is recognised over the term of the swap as if it were interest payable or receivable. J D W ET HE R S P OO N PL C 27 Notes to the financial statements continued 2 Analysis of continuing operations Turnover Cost of sales Gross profit Administrative expenses Operating profit Cost of sales includes distribution costs and all pub operating costs. 3 Directors’ remuneration and share interests The report of the Remuneration Committee is given on page 22. The following table sets out the emoluments of the Directors: £000 Salary/Fees Performance Bonus Benefits in Kind Pension Contributions 182 97 46 68 68 68 68 0 20 20 20 0 Executive Directors T R Martin J Hutson J Clarke (appointed 10 March 1998) S Baker (appointed 4 September 1997) M Davies (appointed 4 September 1997) R Schofield (appointed 4 September 1997) R J Pennycook (resigned 10 March 1998) M R McQuater (resigned 11 Nov 1996) Non-Executive Directors J Herring B R Jervis A C Lowrie R R Martin (resigned 4 November 1996) Total 1997 657 482 28 J D W E T H E RS P O O N P L C 0 0 0 0 0 0 0 0 0 0 0 0 0 78 15 8 5 6 8 7 5 0 0 0 0 0 54 31 - 9 3 6 6 6 6 0 0 0 0 0 36 21 1998 £000 188,515 (149,317) 39,198 (10,831) 28,367 1997 £000 139,444 (106,972) 32,472 (9,533) 22,939 Total 1998 197 114 54 80 82 81 79 0 20 20 20 0 747 - Total 1997 218 108 - - - - 147 101 3 15 15 5 612 - Notes to the financial statements continued 3 Directors’ remuneration and share interests continued The Executive Directors participate in a management bonus scheme designed to incentivise senior management in the achievement of financial and personal targets. The maximum bonus attainable represents 25% of year end salary. Where Directors have interests in the shares of the Company, they are as follows: Ordinary shares of 2p each, held beneficially 1998 1997 T R Martin B R Jervis A C Lowrie - personal - in trust 32,611,679 32,116 5,218,850 3,393,726 157,132 8,664 34,985 75,895 32,475,385 31,910 6,492,240 3,336,290 83,350 - - - J Hutson S Baker M Davies R Schofield Directors’ share options under the Executive Share Option Scheme, which is described in more detail in note 23, comprise: J Hutson J Clarke S Baker 31 July 1997 16,500 20,180 9,745 20,000 60,000 15,000 50,000 49,750 10,000 0 0 0 3,295 50,000 25,000 50,000 37,250 10,000 0 0 13,820 20,000 50,000 30,000 2,500 37,250 10,000 0 0 R Schofield 34,455 20,000 50,000 25,000 50,000 37,250 10,000 0 0 M Davies Granted in Year Options Exercised 16,500 20,180 9,745 20,000 60,000 Exercise Market Price at Exercise 341.5 341.5 341.5 341.5 341.5 Price 35.14 49.56 51.28p 69.40p 78.4p 3,295 35.14 341.5 13,820 35.14 341.5 34,455 35.14 341.5 40,000 49,000 107,362 24,500 91 28,000 13,489 28,000 30,017 Mr R Pennycook, who left office during the year, was permitted by the Board to exercise outstanding options following his departure. The mid-market price on the date of exercise was 300.0p. The interests of Directors have not changed since the financial year end. 2 August 1998 0 0 0 0 0 15,000 50,000 49,750 10,000 40,000 49,000 107,362 0 50,000 25,000 50,000 37,250 10,000 24,500 91 0 20,000 50,000 30,000 2,500 37,250 10,000 28,000 13,489 0 20,000 50,000 25,000 50,000 37,250 10,000 28,000 30,017 Exercise Exercisable Date - - - - - 18/04/98 17/11/98 03/01/00 10/04/00 06/10/00 20/04/01 20/04/01 - 26/10/97 18/04/98 17/11/98 03/01/00 10/04/00 06/10/00 20/04/01 - 19/04/97 26/10/97 17/11/98 12/04/99 03/01/00 10/04/00 06/10/00 20/04/01 - 19/04/97 26/10/97 18/04/98 17/11/98 03/01/00 10/04/00 06/10/00 20/04/01 Exercise Price 92.4p Price - - - - - 92.4p 127.2p 244.2p 237.0p 299.0p 326.0p 326.0p - 78.4p 92.4p 127.2p 244.2p 237.0p 299.0p 326.0p - 69.4p 78.4p 127.2p 176.0p 244.2p 237.0p 299.0p 326.0p - 69.4p 78.4p 92.4p 127.2p 244.2p 237.0p 299.0p 326.0p Options Exercised 200,000 Expiry Date - - - - - 18/04/05 17/11/05 03/01/07 10/04/07 06/10/07 20/04/08 20/04/08 - 26/10/04 18/04/05 17/11/05 03/01/07 10/04/07 06/10/07 20/04/08 - 19/04/04 26/10/04 17/11/05 12/04/06 03/01/07 10/04/07 06/10/07 20/04/08 - 19/04/04 26/10/04 18/04/05 17/11/05 03/01/07 10/04/07 06/10/07 20/04/08 Date 10/03/98 J D W E T H E R S P O O N PL C 29 Notes to the financial statements continued 4 Employee information The average weekly number of persons employed during the year was as follows: Total employees Managerial/administration Hourly paid staff Full time equivalents Managerial/administration Hourly paid staff Employment costs were: Wages and salaries Social security costs Other pension costs Total direct costs of employment Less: wages and salaries capitalised 5 Profit on disposal of tangible fixed assets Net profit on disposal of trading properties, other properties and fixed asset investments No tax is attributable to profits arising on property disposals as the proceeds are used to fund the continuing expansion programme and therefore attract rollover relief. 30 J D W E T HE R S P OO N PL C 1998 Number 1,111 4,427 5,538 1997 Number 881 3,085 3,966 Fte Fte 1,111 1,829 2,940 1998 £000 37,772 2,475 160 40,407 (411) 39,996 1998 £000 14,968 881 1,595 2,476 1997 £000 28,294 1,463 148 29,905 (263) 29,642 1997 £000 - Notes to the financial statements continued 6 Net interest payable Interest payable on bank loans Less: Interest capitalised into properties, on which tax relief is available Interest receivable Charge to profit and loss account 7 Profit on ordinary activities before taxation Profit on ordinary activities before taxation is stated after charging/(crediting): Depreciation Repairs and maintenance Auditors’ remuneration for: audit other services Profit on disposal of fixed assets Rent receivable Operating lease rentals: - property rents - equipment and vehicles 8 Taxation Current tax Corporation tax at 31% (1997: 29%) Irrecoverable advance corporation tax 1998 £000 10,805 (2,202) (401) 8,202 1998 £000 11,236 3,167 38 15 14,968 (388) 13,418 406 1998 £000 - 726 726 1997 £000 6,621 (994) (254) 5,373 1997 £000 8,392 2,663 35 15 0 (254) 9,427 367 1997 £000 50 720 770 There is no charge to corporation tax on the profits of the Company by reference to the availability of unused capital allowances brought forward, and high capital allowances generated in each year. To date the Company has written off £3.2 million (1997: £2.5 million) advance corporation tax which will be available to offset against future mainstream corporation tax liabilities. Deferred tax On a full provision basis, the maximum potential liability to deferred tax (excluding property gains) would be £15.2 million (1997: £5.1 million) representing accelerated capital allowances of £18.4 million (1997: £7.6 million) offset by surplus ACT of £3.2 million (1997: £2.5 million). Based on the Company’s investment plans, no liability to deferred tax would arise in the ord i n a ry course of the Company’s business. No tax has been provided on profits on pro p e rty sold in the year as the gains will be rolled over into new investments. The potential tax liability on gains in the year is £5.4 million. No provision has been made for tax on any gains which might arise in the event of p ro p e rties being sold at their revalued amounts, as the proceeds from any such disposal would be used to fund the continuing expansion programme, and would there f o re attract rollover re l i e f . J D W ET HE R S P OO N PL C 31 Notes to the financial statements continued 9 Dividends Interim paid of 0.75p per share (1997: 0.68p) Final proposed of 1.45p per share (1997: 1.32p) 1998 £000 1,471 2,850 4,321 1997 £000 1,321 2,573 3,894 10 Earnings and cash flow per share The calculation of earnings per share on the net basis is based on profits on ordinary activities after taxation for the period of £19,439,000 (1997: £16,796,000) and on 195,888,289 Ordinary shares (1997 as adjusted for share split: 194,106,545), being the weighted average number of Ordinary shares in issue and ranking for dividend during the period, adjusted in both the current and prior periods to reflect the average number of shares that would have been in issue had the share split effected on 14 November 1997 occurred at the commencement of the prior period. If all outstanding share options had been exercised during the period there would have been no material dilution in earnings per share. The calculation of cash flow per share is based on the net cash generated by business activities and available for investment in new pub developments and extensions to existing pubs, after funding all interest, tax and dividend payments and all other reinvestment in pubs open at the start of the period (“free cash flow”). It is calculated before taking into account proceeds from property disposals and inflows and outflows of financing from outside sources, and is based on the same number of shares in issue as for the calculation of earnings per share. 11 Net cash inflow from operating activities Operating profit Depreciation of tangible fixed assets Change in stocks Change in debtors Change in creditors 12 Analysis of changes in financing during the year Balance at start of year Cash inflows from financing during the year Shares issued in lieu of dividend, non-cash Balance at end of year 32 J D W E T H E RS P O O N P L C 1998 £000 28,367 11,236 (980) 123 8,370 47,116 1997 £000 22,939 8,392 (1,048) (1,448) 9,761 38,596 Share capital (including premium) £000 63,574 939 1,418 65,931 Loans Total 1998 Total 1997 £000 95,833 47,833 - £000 £000 159,407 48,772 1,418 128,427 29,976 1,004 143,666 209,597 159,407 Notes to the financial statements continued 13 Analysis of net debt Cash at bank and in hand Debt due within one year Debt due after one year Net Debt 14 Tangible fixed assets Cost or valuation At 1 August 1997 Reclassification Additions Revaluations Disposals Freehold land and buildings £000 104,334 (13,104) 35,877 (2,380) (19,728) Short leasehold land and buildings £000 99,024 23,619 29,524 4,466 (2,956) At 2 August 1998 104,999 153,677 Depreciation At 1 August 1997 Reclassification Charge for the year Disposals At 2 August 1998 Net book value At 2 August 1998 2,476 (1,023) 1,696 (1,002) 2,147 5,253 1,023 2,795 (583) 8,488 102,852 145,189 At 31 July 1997 101,858 93,771 1998 £000 12,750 (5,785) (137,881) 1997 £000 7,196 (1,000) (94,833) Cash flow £000 5,554 (4,785) (43,048) (130,916) (88,637) (42,279) Equipment, fixtures and fittings Expenditure on unopened properties Total £000 42,401 0 21,034 0 (1,528) 61,907 11,819 0 6,745 (637) 17,927 43,980 30,582 £000 £000 18,302 (10,515) 35,600 0 (713) 264,061 0 122,035 2,086 (24,925) 42,674 363,257 0 0 0 0 0 42,674 18,302 19,548 0 11,236 (2,222) 28,562 334,695 244,513 Included in unopened properties is capitalised interest of £1,968,000 (1997: £964,000). Included in freehold land and buildings is a long leasehold with a net book value of £3,236,000 (1997: £3,198,000). J D W E T H E RS P O O N P L C 33 Notes to the financial statements continued 14 Tangible fixed assets continued Reclassifications represent the transfer of development costs incurred on properties completed in the year from unopened properties to other fixed asset captions, as appropriate and also the transfer arising from the sale and leaseback of properties. Where the Company’s properties have been subject to revaluation, they have been valued on the basis of open market value for existing use by Christie & Co, a specialist licensed property valuer. Excluding the effects of revaluation, properties if stated at cost would be: Freehold land and buildings £000 101,082 (1,869) 99,213 88,588 Freehold land and buildings £000 18,462 11,519 13,942 16,144 60,067 42,785 Short leasehold land and buildings £000 134,507 (7,586) Total £000 235,589 (9,455) 126,921 226,134 83,334 171,922 Short leasehold land and buildings £000 1,979 22,880 16,656 74,147 115,662 29,527 Total £000 20,441 34,399 30,598 90,291 175,729 72,312 102,852 145,189 248,041 1998 £000 286 1997 £000 - Cost Depreciation Net book value 2 August 1998 Net book value 31 July 1997 The valuations were performed during financial years as follows: Number of trading properties 14 38 37 89 178 74 252 31 July 1995 31 July 1996 31 July 1997 2 August 1998 At cost Net book value 15 Investments Traded on Alternative Investment Market 34 J D W E T HE R S P O O N PL C Notes to the financial statements continued 16 Debtors Amounts falling due within one year: Other debtors Prepayments 17 Creditors due within one year Bank loans (note 18) Trade creditors Corporation tax Advance corporation tax Other tax and social security Other creditors Dividend payable Accruals and deferred income 18 Creditors due after one year Bank loans repayable by instalments: between 1 and 2 years between 2 and 5 years after 5 years Other creditors 1998 £000 8,369 3,016 11,385 1998 £000 5,785 29,775 - 935 4,295 1,522 2,850 17,402 62,564 1998 £000 10,474 37,073 90,334 2,674 140,555 1997 £000 578 2,448 3,026 1997 £000 1,000 18,449 65 643 804 2,587 2,573 8,877 34,998 1997 £000 3,825 16,593 74,415 2,456 97,289 Bank loans were secured by floating charges over the Company’s assets. There were loans amounting to £143,666,292 (1997: £95,833,000) repayable by quarterly instalments between the years 1998 and 2012. Loans carried varying rates of interest which averaged 8.5%. Loans totalling £110,000,000 (1997: £65,833,000) at the end of year carried fixed rates of interest or had been matched with fixed rate swaps. The remaining loans carried a variable rate linked to Libor. J D W E T H E RS P O O N P L C 35 Notes to the financial statements continued 19 Called up share capital Authorised: 220,000,000 Ordinary shares of 2p each (1997: 220,000,000) Allotted and fully paid: 196,527,229 Ordinary shares of 2p each (1997: 194,906,870) 1998 £000 4,400 1997 £000 4,400 3,931 3,898 The Company effected a five for one share split on 14 November 1997. The prior year numbers above have been adjusted to reflect the number of shares that would have applied had the share split been effective during that period. 1,172,654 Ordinary shares were issued during the year on the exercise of share options, at an average price of 76.2p per share. 447,705 Ordinary shares were allotted in connection with the offer to shareholders of a scrip dividend alternative to the 1997 final and 1998 interim dividends. 20 Capital, reserves and shareholders’ funds Called up share capital £000 3,898 33 Share premium account £000 59,676 2,324 Revaluation reserve £000 Profit and loss account £000 1998 Shareholders’ funds £000 1997 Shareholders’ funds £000 22,023 39,066 2,086 (772) (494) 772 494 34,407 (4,321) 124,663 2,357 2,086 0 0 34,407 (4,321) 108,108 1,980 1,673 0 0 16,796 (3,894) At start of year Allotments Revaluation Transfer of realised profit on disposal of revalued assets Transfer Profit for the year Dividends At end of year 3,931 62,000 22,843 70,418 159,192 124,663 36 J D W E T H E R S P O O N P L C Notes to the financial statements continued 21 Financial commitments Capital expenditure contracted but not provided for 22 Lease commitments The Company operates a number of leasehold public houses, and occupies leasehold office accommodation. The total annual rental under these leases, all of which have more than 5 years to run, is as follows: The annual rentals pertaining to other leases, primarily motor vehicles, are as follows: Expiry within 1 year Expiry between 1 and 2 years Expiry between 2 and 5 years 1998 £000 15,835 1997 £000 4,702 1998 £000 1997 £000 13,806 10,655 90 94 158 342 68 58 132 258 J D W E T H E RS P O O N P L C 37 Notes to the financial statements continued 23 Share options 31 July Granted Exercised Lapsed 1997 2 August 1998 Exercise Exercisable price per from share Expiry date Executive Share Option Scheme Date Granted February 1992 April 1993 May 1993 April 1994 October 1994 April 1995 November 1995 April 1996 January 1997 April 1997 October 1997 April 1998 10,935 110,985 9,745 391,250 640,000 609,250 1,252,750 360,575 1,015,500 373,000 0 0 0 0 0 0 0 0 0 0 0 0 824,100 752,385 10,935 70,625 9,745 82,500 117,500 329,375 42,500 1,875 70,250 19,000 0 0 0 0 0 33,750 0 10,000 0 40,360 0 275,000 522,500 269,875 203,000 1,007,250 292,525 824,000 316,000 772,375 749,256 66,175 121,250 38,000 51,725 3,129 - 49.6p - 69.4p 78.4p 92.4p 127.2p 176.0p 244.2p 237.0p 299.0p 326.0p - 30/04/96 - 19/04/97 26/10/97 18/04/98 17/11/98 12/04/99 03/01/00 10/04/00 06/10/00 20/04/01 - 30/04/03 - 19/04/04 26/10/04 18/04/05 17/11/05 12/04/06 03/01/07 10/04/07 06/10/07 20/04/08 SAYE Scheme Date granted February 1993 February 1993 CSOP Scheme Date granted December 1996 April 1997 October 1997 April 1998 4,773,990 1,576,485 754,305 527,029 5,069,141 409,210 64,565 473,775 0 0 0 407,474 0 1,736 24,180 0 40,385 - 35.1p - 02/02/00 - 02/08/00 407,474 25,916 40,385 1,876,125 711,875 0 0 0 1,380,700 0 1,188,850 10,875 0 0 0 391,125 1,474,125 133,875 578,000 303,200 1,077,500 128,375 1,060,475 243.0p 234.5p 299.0p 326.0p 15/12/99 12/04/00 08/10/00 20/04/01 15/12/06 12/04/07 08/10/07 20/04/08 2,588,000 2,569,550 10,875 956,575 4,190,100 At 2 August 1998 there were 1,142 members of the Executive Share Option Scheme, with average option holdings of 4,439 shares, there were 2 members of the SAYE scheme, with average holdings of 20,193 shares and there were 2,225 members of the All Employee Company Share Option Plan (CSOP), with average holdings of 1,883 shares. The exercise of an option under the Executive Share Option Scheme will, normally, in accordance with institutional shareholder guidelines, be conditional on the achievement of performance conditions. Options are only exercisable on condition that the earnings per share of the Company between the date of grant of an option and the date of exercise increases by at least the increase in the RPI. As the CSOP Scheme is available to all staff, there are no performance conditions attached to the exercise of options under it. The options in issue shown above include those of the Directors shown in note 3 to the financial statements. 38 J D W E T H E RS P O O N P L C Financial record for the five years ended 2 August 1998 Sales and results Turnover from continuing operations 46,600 68,536 100,480 139,444 188,515 1994 £000 1995 £000 1996 £000 1997 £000 1998 £000 Operating profit from continuing operations Profit on disposal of tangible fixed assets Interest receivable Interest payable Profit on ordinary activities before taxation Taxation Profit on ordinary activities after taxation Dividends Retained profit for the year Recognised gains and losses Profit for the financial year after taxation Unrealised surplus on revaluation of properties Net assets employed Fixed assets Net current assets/(liabilities) Non current liabilities 8,787 0 86 (2,396) 6,477 (563) 5,914 (2,234) 3,680 5,914 2,235 8,149 12,232 17,003 22,939 0 56 (2,575) 9,713 (755) 8,958 (2,927) 6,031 8,958 309 9,267 0 106 (4,004) 13,105 (564) 12,541 (3,417) 9,124 12,541 4,839 17,380 0 254 (5,627) 17,566 (770) 16,796 (3,894) 12,902 16,796 1,673 18,469 28,367 14,968 401 (8,603) 35,133 (726) 34,407 (4,321) 30,086 34,407 2,086 36,493 96,547 4,067 (28,242) 133,196 (6,103) (47,854) 182,123 (6,938) (67,077) 244,513 (22,561) (97,289) 334,695 (34,948) (140,555) 72,372 79,239 108,108 124,663 159,192 Shareholders’ funds 72,372 79,239 108,108 124,663 159,192 Ratios Operating margin Operating margin (excl.rentals on sale and leaseback) Earnings per share (excl. exceptional items Dividends per share 18.9% 18.9% 3.6p 1.32p 17.8% 17.8% 4.9p 1.60p 16.9% 16.9% 6.7p 1.80p 16.5% 16.5% 8.7p 2.00p 15.0% 15.3% 9.9p 2.20p Notes to the financial record (a) The summary of accounts has been extracted from the annual audited financial statements of the Company for the five years shown. (b) The earnings per share and dividend per share figures have been adjusted as appropriate to account for the 5 for 1 share split issue on 14 November 1997 and the 1 for 4 rights issue on 31 March 1994. J D W E T H E R S P O O N P L C 39 Information for shareholders Ordinary shareholdings at 2 August 1998 Shares of 2p each Up to 2,500 2,501 to 10,000 10,001 to 250,000 250,001 to 500,000 500,001 to 1,000,000 Over 1,000,000 Substantial shareholdings Number Shareholdings % Number Total shares held % 1,753 414 289 23 25 26 2,530 69.29 16.36 11.42 0.91 0.99 1.03 1,274,062 2,083,113 15,011,225 7,904,462 16,986,971 153,267,396 0.65 1.06 7.64 4.02 8.64 77.99 100.00 196,527,229 100.00 In addition to certain of the Directors’ shareholdings set out on page 29 the Company has been notified of the following substantial holdings in the share capital of the Company at 16 September 1998: Putnam Companies Janus Capital Corporation Kaufmann Fund Inc. Share prices 1 August 1997 Low High 2 August 1998 16 September 1998 Percentage of share capital % 12.3 9.5 7.0 Number of Ordinary shares 24,257,005 18,649,348 13,750,000 £ 276.0 252.5 341.5 252.5 166.0 Annual reports Further copies of this annual report are available from the Company Secretary, at the Registered Office. Telephone requests can be made on 01923 477777, extension 7796. Copies can also be obtained through the Financial Times’ annual reports service. For details see the London share service pages of the Financial Times. If you would like to contact us, please write to J D Wetherspoon plc, Wetherspoon House, Central Park, Reeds Crescent, Watford, Herts. WD1 1QH or telephone us on 01923 477777. 40 J D W E T H E R S P O O N P L C Public houses directory HOUSES IN GREATER LONDON The Asparagus 1-13 Falcon Road, Battersea, London SW11 The Bankers Draft 80 High Street, Eltham, London SE9 The Bankers Draft 36-38 Friern Barnet Road, Southgate, London N11 The Barking Dog 61 Station Parade, Barking, Essex The Beaten Docket 50-56 Cricklewood Broadway, London NW2 The Beehive 407-409 Brixton Road, London SW9 The Camden’s Head 456 Bethnal Green Road, London E2 The Coliseum Manor Park Road, Harlseden, London NW10 The Colley Row Inn 54-56 Collier Row, Romford, Essex The Coronet 338-346 Holloway Road, London N7 The Crown & Sceptre 2a Streatham Hill, London SW2 The Drum 557-559 Lea Bridge Road, London E10 The Edmund Halley 25-27 Leegate Centre, Lee Green, London SE12 The Elbow Room 503-505 High Road, Tottenham, London N17 The Foxley Hatch 8-9 Russell Hill Road, Purley, Surrey The Fox on the Hill 149 Denmark Hill, London SE5 The Gate House 1 North Hill, Highgate, London N6 The George 17-21 George Street, Croydon, Surrey The George High Street, Wanstead, London E11 The Gilpin’s Bell 50-54 Fore Street, London N18 The Golden Grove 146-148 The Grove, Stratford, London E15 The Good Yarn 132 High Street, Uxbridge, Middlesex The Great Spoon of Ilford 114-116 Cranbrook Road, Ilford, Essex The Grid Inn 22 Replingham Road, Southfields, London SW18 The Half Moon 213-233 Mile End Road, London E1 The Half Moon 749 Green Lanes, Winchmore Hill, London N12 Hamilton Hall Liverpool Street Station, London EC2 The Hart & Spool 148 Shenley Road, Borehamwood, Herts The Harvest Moon 141-143 High Street, Orpington, Kent JJ Moons Departure Lounge, Terminal 4, Heathrow Airport JJ Moons 56a High Street, Tooting, London SW17 JJ Moons 12 Victoria Road, Ruislip Manor, Middlesex JJ Moons 397 High Road, Wembley, Middlesex JJ Moons 553 Kingsbury Road, London NW9 JJ Moons 46-62 High Street, Hornchurch, Essex JJ Moons 19-20 The Broadwalk, Pinner Road, North Harrow, Middlesex JJ Moons 3 Shaftesbury Parade, Shaftesbury Circle, South Harrow, Middlesex The King’s Ford 250-252 Chingford Mount, Chingford, London E4 The King’s Tun 153-157 Clarence Street, Kingston-Upon-Thames The Lamb 52-54 Church Street, Edmonton, London N9 The Last Post 227 High Road, Loughton, Essex The Liberty Bounds 15 Trinity Square, London EC3 The Lord Denman 270-272 Heathway, Dagenham, Essex The Lord Moon of the Mall 16-18 Whitehall, London SW1 The Man in the Moon 40-42 Chalk Farm Road, London NW1 The Man in the Moon 1 Buckingham Parade, Stanmore, Middlesex The Masque Haunt Old Street, London EC2 The Millers Well 419-421 Barking Road, East Ham, London E6 The Moon and Cross 104-1106 High Street, Waltham Cross, Herts The Moon & Sixpence 250 Uxbridge Road, Hatch End, Middlesex The Moon & Sixpence 1250-1256 Uxbridge Road, Hayes End, Middlesex The Moon & Sixpence 185 Wardour Street, London W1 The Moon & Stars 164 High Street, Penge, London SE20 The Moon & Stars 99-103 South Street, Romford, Essex J D W E T H E R S P O O N P L C 41 Public houses directory continued The Moon on the Hill 373-375 Station Road, Harrow, Middlesex The Old Suffolk Punch 10-12 Grand Parade, Green Lanes, London N4 The Tollgate 26-30 Turnpike Lane, London N8 The Moon on the Hill 5-9 Hill Road, Sutton, Sur rey The Outside Inn 312-314 Neasden Lane, London NW10 The Three Horseshoes 28 Heath Street, Hampstead, London NW3 The Moon on the Square 30 The Centre, Feltham, Middlesex The Paper Moon 55 High Street, Dartford, Kent The Tigers Head 350 Bromley Road, Catford, London SE6 The Moon Under Water 194 Balham High Street, London SW12 The Penderel’s Oak 283-288 High Holborn, London WC1 The Village Inn 402-408 Rayners Lane, Pinner, Middlesex The Moon Under Water 44 High Street, Watford, Herts The Pommeler’s Rest 196-198 Tower Bridge Road, London SE1 The Watch House 198-204 High Street, Lewisham, London SE13 The Moon Under Water 10-11 Broadway Parade, Coldharbour Lane, Hayes, Middlesex The Postal Order 33 Westow Street, Crystal Palace, London SW19 The Walnut Tree 857-861 High Street, Leytonstone, London E11 The Moon Under Water 105-107 Charing Cross Road, London WC2 The Moon Under Water 84-86 Staines Road, Hounslow, Middlesex The Moon Under Water 148 High Street, Barnet, Herts The Moon Under Water 10 Varley Parade, Colindale, London NW9 The Moon Under Water 53-57 London Road, Twickenham, Middlesex The Moon Under Water 115-117 Chase Side, Enfield, Middlesex The Moon Under Water 28 Leicester Square, London WC2 The Moon Under Water London Road, Norbury, London SW16 The Moon Under Water 179 Upper Street, Islington, London N1 The New Crown 80-84 Chase Side, Southgate, London N4 The New Fairlop Oak Fencepiece Road, Barkingside, Essex The New Moon 25-26 Kenton Park Parade, Kenton Road, Harrow, Middlesex 42 J D W E T H E R S P O O N P L C The Railway 202 Upper Richmond Road, Putney, London SW15 Wetherspoons Victoria Station, London SW1 The Railway Bell 13 East Barnet Road, New Barnet, Herts Wetherspoons Airside, Terminal 2, Heathrow Airport The Red Lion & Pineapple 281 High Street, Acton, London W3 Wetherspoons Landside, Terminal 4, Heathrow Airport The Regent 19 Church Street, Walton on Thames, Surrey Wetherspoons 33 Aberconway Road, Morden, Surrey The Rochester Castle 145 High Street, Stoke Newington, London N16 Wetherspoons 552-556 London Road, North Cheam, Sur rey The Sarsen Stone 32 High Street, Wealdstone, Middlesex The White Lion of Mortimer 223 London Road, Mitcham, Sur rey The Shakespeare’s Head Africa House, 64-68 Kingsway, London WC2 The White Lion of Mortimer 125-127 Stroud Green Road, London N4 The Sir John Oldcastle 29-35 Farringdon Road, London EC1 The Whole Hog 430-434 Green Lanes, Palmers Green, London N13 The Sky Lark 34-36 Southend, Croydon, Surrey The Sovereign of the Seas 109-111 Queensway, Petts Wood, Kent The Surrey Docker 185 Lower Road, Rotherhithe, London SE16 The Sylvan Moon 27 Green Lane, Northwood, Middlesex The Tally Ho 749 High Road, North Finchley, London N12 The Whispering Moon 25 Ross Parade, Woodcote Road, Wallington, Surrey The Wibbas Down Inn 6-12 Gladstone Road, Wimbledon, London SW19 The William Jolle 53 Joel Street, Northwood Hills, Middlesex The William Morris 2-4 King Street, Hammersmith, London W6 The Wrong ‘Un 234-236 The Broadway, Bexleyheath, Kent Public houses directory continued REST OF ENGLAND BICESTER BRACKNELL ASHFORD The County Hotel 10 High Street, Ashford, Kent ASHTON-IN-MAKERFIELD The Penny Black 58 Sheep Street, Bicester, Oxon The Old Manor Grenville Place, Church Road, Bracknell, Berks BIRKENHEAD BRAINTREE The John Laird The Europa Centre, Birkenhead, Mersyside Wetherspoons Fairfield Road, Braintree, Essex The Sir Thomas Gerard Gerard Street, Ashton-in-Makerfield, Lancs BIRMINGHAM ASHTON-UNDER-LYNE The Ash Tree Main Street Shopping Arcade, Wellington Road, Ashton-Under-Lyne, Gt. Manchester BANBURY The Exchange 49-50 High Street, Banbury, Oxon BARROW IN FURNESS The Furness Railway Dalton Road, Barrow in Furness, Cumbria BASILDON The Moon on the Square 1-15 Market Square, Basildon, Essex BEDFORD The Pilgrim’s Progress 42 Midland Road, Bedford, Beds BEDMINSTER The Robert Fitz Harding 24 Cannon Street, Bedminster, Avon BERKHAMSTED The Crown 145 High Street, Berkhamsted, Herts The Square Peg 115 Corporation Street, Temple Court, Birmingham The Figure of Eight Broad Street, Birmingham BLACKBURN The Postal Order 19 Darwen Street, Blackburn, Lancs BOGNOR REGIS The Hatters Inn 2-10 Queensway, Bognor Regis, W. Sussex BOLTON The Spinning Mule Unit 2, Nelson Square, Bolton, Gt. Manchester BOSCOMBE The Sir Percy Florence Shelly 673-675 Christchurch Street, Boscombe, Dorset BOSTON The Moon Under Water 6 High Street, Boston, Lincs BOURNEMOUTH The Moon in the Square 4-8 Exeter Road, Bournemouth, Dorset BRISTOL The Berkeley 18-19 Queen’s Road, Clifton, Bristol, Avon The Commercial Rooms 43-45 Corn Street, Bristol, Avon The The Staple Hill Oak 84-86 High Street, Staple Hill, Bristol, Avon The Van Dyke 748-756 Fishponds Road, Fishponds, Bristol, Avon BRIXHAM The Vigilance 4 Bolton Street, Brixham, Devon BROMSGROVE The Golden Cross Hotel 20 High Street, Bromsgrove, Worcs BURTON ON TRENT The Lord Burton 154 High Street, Burton on Trent, Staffs BURY The Robert Peel 5-10 Market Place, Bury, Lancs BURY ST EDMUNDS The Wolf 88-89 St John Street, Bury St Edmunds, Suffolk J D W E T H E R S P O O N P L C 43 Public houses directory continued CANTERBURY CRADLEY HEATH FOLKESTONE The Thomas Ingoldsby 5-9 Burgate, Canterbury, Kent CARLISLE The Woodrow Wilson 48 Botchergate, Lower Street, Carlisle, Cumbria CAVERSHAM The Baron Cadogan 22-24 Prospect Street, Caversham, Berks CHADWELL HEATH The Eva Hart 1128 High Street, Chadwell Heath, Essex CHELMSFORD The Globe 65 Rainsford Road, Chelmsford, Essex CHESHAM The Last Post 77 The Broadway, Chesham, Bucks CHESTER Wetherspoons 78-92 Foregate Street, Chester, Cheshire CLACTON The Moon and Starfish 1 Marine Parade East, Clacton, Essex COLCHESTER The Playhouse 4 St. John’s Street, Colchester, Essex 44 J D W E T H E R S P O O N P L C The Moon Under Water 164-166 High Street, Cradley Heath, W. Midlands Wetherspoons The Baptist Galleries, Rendezvous Street, Folkestone, Kent CRAWLEY GATWICK The Jubilee Oak 6 Grand Parade, Crawley, W. Sussex DARLINGTON The Tanners Hall 63-64 Skinnersgate, Darlington DERBY The Babington Arms 11-13 Babington Lane, Derby, Derbyshire The Standing Order 28-32 Irongate, Derby, Derbyshire DOVER The Eight Bells 19 Cannon Street, Dover, Kent DUDLEY The Full Moon 58-60 High Street, Dudley, W. Midlands EXETER The Imperial New North Road, Exeter, Devon FAVERSHAM The Leading Light 20-22 Preston Street, Faversham, Kent FLEET The Prince Arthur 238 Fleet Road, Fleet, Hants The Red Lion Departure Lounge, North Terminal, Gatwick Airport The Village Inn South Terminal, Landside, Gatwick Airport GLOUCESTER The Regal St Aldate Street, Kings Square, Gloucester, Glos GRANTHAM The Tollemache Inn 17 St Peter’s Hill, Grantham, Lincs GRAVESEND The Robert Pocock 181-183 Windmill Street, Gravesend, Kent GREAT YARMOUTH The Troll Cart 7-9 Regent Road, Great Yarmouth, Norfolk GRIMSBY The Yarborough Hotel 29 Bethlehem Street, Grimsby, Lincs HARTLEPOOL The King John’s Tavern 1 South Road, Hartlepool HAVANT The Parchment Makers 1 Park Road North, Havant, Hants Public houses directory continued HEANOR LEATHERHEAD MANCHESTER The Red Lion 2 Derby Road, Heanor, Derbyshire The Edmund Tilney 30-34 High Street, Leatherhead, Surrey The Harbord Harbord 172 Long Street, Middleton, Manchester HEMEL HEMPSTEAD LEEDS The J P Joule Northenden Road, Sale, Manchester The Full House 128 Marlowes, Hemel Hempstead, Herts The Stick or Twist The Podium Site, Merrion Way, Leeds, Yorks The Moon Under Water 68-74 Deansgate, Manchester HIGH WYCOMBE LEICESTER The Falcon 9 Cornmarket, High Wycombe, Bucks The Last Plantagenet 107 Granby Street, Leicester, Leics HORSHAM LEIGH ON SEA Wetherspoons 49 Piccadilly, Manchester MARKET HARBOROUGH The Sugar Loaf 18 High Street, Market Harborough The Lynd Cross St John’s House, Springfield Road, Horsham, W. Sussex The Elms 1060 London Road, Leigh on Sea, Essex MATLOCK HOVE The Cliftonville Inn 98-101 George Street, Hove, E. Sussex HOYLAKE The Hoylake Lights 52-54 Market Street, Hoylake, Merseyside HUCKNALL The Pilgrim Oak 44-46 High Street, Hucknall, Notts IPSWICH The Cricketers Crown Street, Ipswich, Suffolk KETTERING LETCHWORTH The Three Magnets 18-20 Leys Avenue, Letchworth, Herts LICHFIELD The Crown Crown Square, Matlock, Derbyshire MIDDLESBROUGH The Isaac Wilson 61 Wilson Street, Middlesbrough, Cleveland The Acorn Inn Tamworth Street, Lichfield, W Midlands MILTON KEYNES LINCOLN The Ritz High Street, Lincoln, Lincs LIVERPOOL The Raven 72 Walton Vale, Liverpool, Merseyside Wetherspoons Units 1&2, Charlotte Row, Liverpool, Merseyside Wetherspoons 201 Midsummer Boulevard, Bouverie Square, Milton Keynes, Bucks NESTON The Lode Star Brook Street, Neston, Merseyside NEWCASTLE Wetherspoons Unit 1, 77 The Metrocentre, Newcastle, Tyne & Wear NORTHAMPTON The Moon on the Square 6 The Parade, Market Place, Northampton J D W ET H E R S P OO N PL C 45 The Earl of Dalkeith 13-15 Dalkeith Street, Kettering, Northants MAIDSTONE The Muggleton Inn 8-9 High Street, Maidstone, Kent LEAMINGTON SPA The Benjamin Satchwell 112-114 The Parade, Leamington Spa Public houses directory continued NORWICH ROCHDALE SOUTHEND The Bell 5 Orford Hill, Norwich, Norfolk The Regal Moon The Butts, Rochdale, Lancs The Last Post Weston Road, Southend, Essex NUNEATON ROTHERHAM SOUTHPORT The Felix Holt Stratford Street, Nuneaton, W. Midlands The Rhinoceros 35-37 Bridgegate, Rotherham, S. Yorks Wetherspoons 93-97 Lord Street, Southport, Merseyside OLDHAM The Up Steps Inn 17-23 High Street, Oldham, Lancs PAIGNTON The Isaac Merritt 54-58 Torquay Road, Paignton, Devon PETERBOROUGH The College Arms 40 The Broadway, Peterborough, Northants PORTSMOUTH Wetherspoons 2 Guildhall Walk, Portsmouth, Hants PRESTON The Grey Friar Unit A, 144 Friargate, Preston, Lancs READING The Back of Beyond 104-108 Kings Road, Reading, Berks The Hope Tap 99-105 Friar Street, Reading, Berks The Monk’s Retreat 163 Friar Street, Reading, Berks REDHILL The Sun 17-21 London Road, Redhill, Sur rey 46 J D W E T H E R S P O O N P L C RUGELEY The Plaza Horsefair, Rugeley, Staffs SOUTHSHIELDS The Woodhave Mile End Road, Southshields ST. ALBANS STAFFORD The Cross Keys 2 Chequer Street, St. Albans, Herts The Picture House Bridge Street, Stafford, W. Midlands SCARBOROUGH STAINES The Lord Rosebery 85-87 Westborough, Scarborough, Yorks The George 2-8 High Street, Staines, Middlesex SHEFFIELD The Bankers Draft 1-3 Market Place, Sheffield, Yorks SKEGNESS The Red Lion Lumley Road, Skegness, Lincs SLOUGH The Moon & Spoon 86 High Street, Slough, Berks SOUTHAMPTON The Standing Order 30 High Street, Southampton, Hants The Giddy Bridge London Road, Southampton, Hants STOCKTON The Thomas Sheraton 4 Bridge Road, Stockton, Cleveland STOURBRIDGE Wetherspoons Hungary Hill, Stourbridge, W. Midlands STROUD The Lord John 15-17 Russell Street, Stroud, Glos SUNDERLAND The William Jameson 30-32 Fawcett Street, Sunderland, Tyne & Wear SURBITON The Cap in Hand 174 Hook Rise, Surbiton, Sur rey Public houses directory continued Coronation Hall St Mark’s Hill, Surbiton, Surrey SUTTON COLDFIELD WESTERN SUPER MARE EDINBURGH The Dragon Inn 15 Meadow Street, Weston Super Mare, Avon The Standing Order 62-66 George Street, Edinburgh The Bishop Vesey 63 Boldmere Road, Sutton Coldfield, W. Midlands WIGAN GLASGOW The Moon Under Water 5-7a Market Place, Wigan, Lancs The Counting House 2 St Vincents Place, Glasgow, Strathclyde SWINDON The Savoy 38-40 Regent Street, Swindon, Wilts WIGSTON The Sir John Stirling Maxwell Unit 13b, Shawlands Arcade, 104 Kilmarnock Road, Glasgow, Strathclyde TAUNTON The Perkin Warbeck 22-23 East Street, Taunton, Devon TORQUAY The William Wygstor 84 Leicester Road, Wigston, Leics WINCHESTER The Old Gaol House 11 Jewry Street, Winchester, Hants The London Inn 15-16 The Strand, Torquay, Devon WOKING WALES EBBW VALE The Picture House Market Street, Ebbw Vale, Gwent Wetherspoons 51-57 Chertsey Road, Woking, Surrey MONMOUTH TUNBRIDGE WELLS The Opera House 88 Mount Pleasant Road, Tunbridge Wells, Kent WOLVERHAMPTON WALSALL The Moon Under Water 53-55 Lichfield Street, Wolverhampton, W. Midlands The Imperial Darwall Street, Walsall, W. Midlands WORCESTER WELLINGBOROUGH The Red Well 16 Silver Street, Wellingborough, Northants WEST BROMWICH The Billiard Hall St Michael’s Ringway, West Bromwich, W. Midlands The Postal Order 18 Foregate Street, Worcester, Worcs SCOTLAND ABERDEEN The Archibald Simpson Castle Street, Aberdeen, Aberdeenshir e WEST OXTED DUNDEE The Oxted Inn Units 1-4, Station Road West, West Oxted, Surrey The Counting House 67-71 Reform Street, Dundee, Tayside Wetherspoons The King’s Head, Monmouth Street, Monmouth NEWPORT Wetherspoons Units 10-12 Cambrian Centre, Newport, Gwent SWANSEA The Bank Statement 57-58 Wind Street, Swansea, Glamorgan The Potters Wheel 86 The Kingsway, Swansea, Glamorgan J D W E T H E R S P O O N P L C 47 

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