Annual Report
for the 53 weeks ended 3 April 2023
Highlights
for the 53-week period ending 3 April 20231
Revenue
(£m)
£368.9
2022: £309.0
Operating profit
(£m)
£43.4
2022: £51.7
Profit before tax
(£m)
£36.2
2022: £42.1
Adjusted operating profit
(£m)2
£52.4
2022: £51.4
Adjusted profit before tax
(£m)2
Find out how we are investing
for the future in our pubs.
Pages 08-09 and 18-19
£45.2
2022: £41.8
Adjusted EBITDA
(£m)2
£85.5
2022: £82.5
Find out how we are evolving our
premium drinks offer.
Page 17
Find out how we nurture
and develop our people.
Pages 26-29
Find out how we are supporting
local producers and suppliers.
Pages 33-35
Net cash generated
from operations (£m)
Adjusted basic earnings
per share2
£83.8
2022: £107.0
64.29p
2022: 56.26p
Basic earnings per share
Dividend per share
50.78p
2022: 58.83p
20.52p
2022: 18.81p
Net assets per share3
Net debt (£m)
£12.38
2022: £11.97
£165.2
2022: £173.8
Net debt to adjusted EBITDA
1.9x
2022: 2.1x
All of the results above are from continuing operations.
1 The prior financial year was a 52-week period.
2 Reference to an ‘adjusted’ item means that item has been adjusted to exclude non-underlying costs (see notes 11 and 12).
3 Net assets per share are the group’s net assets divided by the shares in issue at the period end.
Welcome to Young’s
Young’s pubs are at the heart of our local communities in
London and the south of England. With more than 220
establishments, our award-winning design means excellence
in ambience as well as service and location. From poetic pubs
steeped in history to secret underground cocktail bars, the
character and individuality of each of our premises gives them
a unique feel. Our pubs are distinctly different, and the people
who work in them have pride in our culture and passion for
the work they do.
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Contents
Investing in our estate
Strategic Report
04 Chairman’s statement
06 Young’s at a glance
08
10 Our business model
12 Chief executive’s review
15 Our strategy
16 Key Performance Indicators
18 Our latest acquisitions
20 Section 172(1) statement
24 Sustainability report
44 Principle risks and uncertainties
49 Business and financial review
Corporate Governance
56 Chairman’s corporate
governance statement
58 Board of directors
61 Leadership team
63 Corporate governance report
71 Audit committee report
77 Remuneration committee report
82 Directors’ report
Independent auditor’s report
Financial Statements
88
95 Group income statement
96 Group statement of
comprehensive income
97 Balance sheets
99 Statements of cash flow
100 Group statement of changes
in equity
101 Parent company statement
of changes in equity
102 Notes to the financial statements
Shareholder Information
146 Notice of meeting
151 Explanatory notes to the
notice of meeting
153 Senior personnel, committees,
banks, advisers and others
153 Shareholder information
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
01
Strategic Report
Year in review
We take great pride in surprising and delighting
our customers. Here are some fine examples
from the last twelve months, celebrating everything
that makes Young’s such a great place to work.
Annual Winter
Warmer breakfast (below)
Epitomising everything that is great about
the Great British pub, the launch of Young’s
seasonal cask ale, Winter Warmer, is held
every year at the White Cross in Richmond.
The Young’s dray horses are accompanied
by the buzzing sound of Morris dancers.
A guaranteed sell-out, the event has gained
legendary status since 1991.
Award winning team
(above and right)
Our group executive chef, Matt Sullivan,
finished second in the annual
Scotch Egg competition hosted
at the Guinea Grill, Mayfair.
His dry-aged salt marsh lamb
and anchovy Scotch egg has
even made its way onto
our menus. The Oyster
Shed, Bank, and head
chef Natalie Coleman,
received an AA Rosette
for culinary excellence.
She also picked up the
prize for ‘best pub chef’
at the Great British
Pub Awards.
Jubilee celebrations (above)
In June, we all joined together to celebrate
the Queen’s Jubilee and commemorate
Her Majesty Queen Elizabeth’s 70 years
on the throne. Sadly, only a few months
later, the country entered a period of
mourning following her passing.
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Summer Infusion cocktails
(below)
Building on the success of last year, our
Summer Infusion menu featured exciting
new drinks focusing on vibrant colours and
flavours. Drinks such as the Amalfi Spritz,
Watermelon & Basil Spritz and the popular
Paloma were perfect for our fabulous gardens.
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Launched our new
draught range (above)
From April, we started pouring our new
draught beer range with a number of exciting
new products such as Pravha and Beavertown
Young Sun, alongside the returning Aspall
cider and other big hitters – Peroni, Guinness,
Estrella and Young’s Original, of course.
Refreshed our Burger
Shack menu (left)
Ahead of this summer we launched the
latest Burger Shack menu. Focusing on bold
flavours, new additions include the buttermilk
fried chicken ‘Hot Chick’ and the Louisiana
‘Hot Beef’ burgers, joined by exciting new
sides and our first sweet treat, delicious mini
cinnamon doughnuts.
Save While You Sleep (above)
We launched our ‘Save While You Sleep’
initiative in partnership with Zero Carbon
Services, aimed at ensuring our teams are
adhering to best practice when it comes to
switching on and off equipment at the right
time. This will play an important role in our
pledge to respect the planet and reduce
energy consumption.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Strategic Report
Chairman’s statement
£368.9m
Revenue
(2022: £309.0m)
£85.5m
Adjusted EBITDA
(2022: £82.5m)
Our aim continues to
be premium, individual
and differentiated.
“Despite the economic
challenges of the past
year, Young’s has
continued to thrive
through our great pubs
and wonderful people.”
Stephen Goodyear
Chairman
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The Ram Agency, our own internal
recruitment platform which caters for the
desire to work flexibly, continues to grow
and our digital career pathway, which was
launched in May, has increased employee
engagement and enabled management
to identify key talent for succession
planning. The board and leadership team
fully support our evolving sustainability
strategy and we will continue to find
ways to reduce our carbon footprint and
improve the wellbeing of both our teams
and our customers.
I would like to extend my thanks to our
executive directors for their hard work,
leadership and dedication throughout
an extremely demanding year, to
the non-executive directors for their
continued wisdom, guidance and
encouragement, and finally to our
shareholders for their continued support
during such a demanding period.
Stephen Goodyear
Chairman
24 May 2023
In such a volatile economic environment
this has been a highly successful year for
Young’s, and these results demonstrate
the strength from our long-standing
strategy of operating a premium,
differentiated and well-invested managed
estate. Total revenue was up 19.4% on
last year, underpinned by our strong
managed house like-for-like sales
growth of 12.9% on a comparable 52
week basis. Despite the huge pressure
of increased costs that have had such
a negative impact over the past year,
we still achieved adjusted EBITDA of
£85.5 million (2022: £82.5 million),
an increase of 3.6%.
A fundamental characteristic of Young’s
ongoing success has been the consistent
investment for future growth through
a combination of acquisitions and
investment in our estate, made possible
by our strong cash generation. During the
year we invested a total of £58.4 million,
this included the acquisition of six new
pubs, adding a total of 40 new bedrooms
and opening up new locations for
Young’s. Alongside these acquisitions
we continued to invest significantly in
our existing estate, notably at the Hare
& Hounds (East Sheen), Crown (Bow),
Marquess of Anglesey (Covent Garden)
and Hort’s Townhouse (Bristol) where we
transformed the pub by creating a further
19 boutique bedrooms and completely
redesigning the bar area. Despite the
ongoing investment, the business remains
conservatively financed, with net debt
of £165.2 million and 1.9 times our
adjusted EBITDA.
On the back of another successful
year, the board is very pleased to
recommend a final dividend of 10.26
pence. If approved by shareholders,
this will result in a total dividend of
20.52 pence (2022: 18.81 pence),
a 9.1% increase. It is expected to be
paid on 13 July 2023 to shareholders
on the register at close of business on
9 June 2023.
The Young’s board continued to
evolve during the year. As previously
announced, Simon Dodd was appointed
chief executive on 5 July 2022,
succeeding Patrick Dardis who stepped
down from this role at last year’s AGM
and from the board on 30 September
2022. Simon was recruited just under
four years ago with succession planning
in mind and his excellent leadership
skills, vision and operational experience
are already proving to be great assets to
Young’s. Once again, on behalf of the
board, I would like to thank Patrick for his
huge contribution to the company over
the last 20 years.
In addition, Mark Loughborough
joined the board as retail director
on 30 September 2022. He is an
experienced operator, having spent 11
years with Young’s in a number of senior
roles, most recently as senior director of
operations. We have assembled a very
talented executive team who will take
Young’s to the next chapter.
We were also pleased to welcome
Sarah Sergeant as an independent
non-executive director on 1 March 2023.
She has a wealth of experience in the
leisure, hospitality and property sectors,
we are very much looking forward to
working with her.
As a board we are passionate about
building a sustainable company and
we are committed to driving a positive
environmental, social, and governance
agenda. During the year, taking advice
from our partners at Savills Earth,
we have grouped our properties
based on age, condition, servicing and
heritage status, which will guide our
net zero implementation plans. In May,
we launched the ‘Save While You
Sleep’ initiative to guide and encourage
energy saving opportunities through
operational best practice.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Strategic Report
Young’s at a glance
From stunning riverside terraces to flower-filled garden huts, our collection
of pubs have some of the best gardens in London and the south of England.
Inside, our pubs have style and character, and the people who work with us
have pride in our culture and passion for the work they do.
1831
Established
227
Pubs
40
1
£842.5m
Valuation of our estate
£773.7m
£808.0m
£842.5m
2021
2022
2023
226
187
Freehold
Leased
Tenanted
Managed pubs
5,654
Employees
793
Bedrooms
41
Burger Shacks
43
57
Female
Male
2.1m
Pints sold
473k
Young’s On Tap app users
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Our locations
30
South West
33
South East
Cambridgeshire
Buckinghamshire
Berkshire
Oxfordshire
1
Hertfordshire
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Gloucestershire
Wiltshire
14
3
3
1
1
6
2
1
4
Greater London
164
21
3
2
1
Kent
East Sussex
Surrey
Dorset
West Sussex
Devon
Hampshire
Camden
Enfield
Barnet
Westminster
Islington
164 Greater London
Brent
Kensington
& Chelsea
1
1
Hackney
City of London
Ealing
Hammersmith
& Fulham
Hounslow
1
Richmond
Kingston-
upon-Thames
11
10
3
14
8
6
7
10
2
1
3
9
10
28
6
14
5
1
8
2
Newham
Tower Hamlets
Greenwich
3
Lewisham
Wandsworth
Lambeth
Merton
Sutton
Southwark
Bromley
1-5
6-10
11-15
16-20
More than 20
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Strategic Report
Investing in our estate
Our pubs and bedrooms
are as individual as the
customers we serve.
All of our pubs are
refurbished to the highest
standard, celebrating
their unique heritage
and individual character.
Coborn, Mile End
(below)
Located in London’s East End, close to Victoria Park,
this charming and characterful pub has been restored
to create a wonderful warm and inviting space.
Internal reconfigurations have created a new snug
area and the redecorated bar now features quirky
personal touches recognising local regulars, such as
‘Terry and Dave’s corner’.
Brook Green, Hammersmith
(left)
Elegantly renovated, this pub sits proudly on the
corner of the historic Brook Green in Hammersmith.
Upstairs you will find 17 boutique bedrooms, while
downstairs the pub has its own cocktail bar, Smiths.
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Hort’s Townhouse, Bristol
(above and left)
Beautifully restored, this Grade-II listed
building has been transformed into
Hort’s Townhouse. Featuring 19 stunning
boutique bedrooms, all individually
designed and fabulously furnished,
like none other you will find in the city.
Our latest pub with rooms development
is just a stone’s throw from Bristol’s
city centre.
Elgin, Notting Hill
(right)
A cornerstone of Ladbroke Grove, with
a rich and vibrant history, in this iconic
location on the edge of Notting Hill.
The pub has been lovingly restored to
its former glory to create a traditional
British pub.
Hare & Hounds, East Sheen
(above)
The heart of the East Sheen community,
the investment here has brought one of
the best pub gardens in London to life.
With more than 200 covers, customers
can relax in a selection of huts and
pergolas as they feast on food and drink
served from the outside bar and kitchen.
Bishop, Kingston
(left)
Nestled on the banks of the River
Thames, the Bishop has the most
beautiful view of Kingston bridge.
Its riverside terrace is the perfect place
to watch the world go by with a pint
of Young’s Original.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Strategic Report
Our business model
Our business model captures how we are a resilient business that delivers
value for all of our stakeholders in a sustainable, long-term way.
What we do
How we do it
We manage, acquire and invest
in premium, differentiated pubs
and pubs with rooms in prime
locations across London and the
south of England.
Freehold estate
We run a predominantly
freehold estate that gives
us greater control and
opportunities within our
business, and enables
us to negotiate better
terms with lenders,
whilst allowing us to also
benefit from increases
in property values.
Premium pubs
We operate differentiated,
premium, mostly drink-
led managed pubs in
London and the south
of England. Our locations
are mainly in areas that
have a high proportion
of affluent customers.
Our competitive advantages enable
us to deliver sustainable growth
and provide the agility needed in
the face of unforeseen challenges.
People
• Depth of knowledge
and expertise
• Strong customer
relationships
• Trusted teams
• Unique culture
Revenue mix
• Our revenue mix is
62.5% drink, 31.5%
food and 6.0%
accommodation
Diversified estate
• Freehold-rich estate
• Prime locations often
within walking distance
of public transport links
Buying power
• Buying power of our
managed estate to
source the best products
at the best prices
Our Values
Authentic
We’ve been around since 1831 and
see our heritage as the foundation
of our success. We’re proud of where
we’ve come from but have our sights
set firmly on the future.
Assured
We’re not humble but we are also
not show-offs. We do things well,
with an understanding that in life,
you get what you pay for.
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The value we deliver
Sustainable growth
Our business creates value for our
stakeholders and economic value
in the regions where we operate.
Suppliers
• Building long-standing
relationships with
our suppliers
Society
• Contributing to our
local communities
People
• Creating
rewarding careers
for our people
Investors
• Sustainable
financial returns for
our shareholders
Customers
• High quality
service across
our pubs and pubs
with rooms
We create long-term sustainable
growth through strategic
investments in our estate, our
people and our communities,
delivering value for all of our
stakeholders. At Young’s, we go
beyond thinking about profit –
we are making investments that
not only build up the bottom line,
but also improve society.
Community
We are the centre of the community,
essential and well-loved by our
customers, as essential and well-loved
as they are by us. We believe in local
community celebration.
Convivial
Premium yet personal hospitality.
Friendly, lively good humour.
Individual
From the late-night city bolt holes to the
sprawling neighbourhood centrepieces,
from ancient, oak-beamed village inns
to underground cocktail bars, our pubs
are as individual as the customers who
frequent them every day.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Strategic Report
Chief executive’s review
£52.4m
Adjusted operating profit
(2022: £51.4m)
£83.8m
Net cash generated from operations
(2022: £107.0)
A strong year
of trading gives us
reason for optimism.
“ Our success as a
business is dependent
on having outstanding
pubs with the best
people to operate them.”
Simon Dodd
Chief Executive
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I am very pleased to announce such a
positive set of results. We have built on the
momentum of the resumption of normal
trading and the strong start we made in the
first half of this financial year. The past few
years have been tough for our industry as
a whole and these results are a testament
to the quality and dedication of our
people, and the value added by recent and
consistent investment. It demonstrates that
our strategy of running premium, individual
and differentiated pubs continues to deliver.
Despite the ongoing challenges and prior
year comparatives supported by reduced
VAT rates, total revenue was up by 19.4%
to £368.9 million (2022: £309.0 million)
for the 53-week period, underpinned by
our managed pub like-for-like performance,
up by 12.9% on a 52-week basis, alongside
the continued investment in our existing
estate and strategically selected acquisitions.
We have not been immune to the
increasing cost of food, consumables,
and the rise in the National Living Wage,
however, our foresight to fix utility rates
until March 2024 has minimised the
full impact of higher energy prices.
Despite these headwinds, our adjusted
operating profit was £52.4 million
(2022: £51.4 million), with adjusted profit
before tax up by 8.1% to £45.2 million
(2022: £41.8 million). Total profit before
tax was £36.2 million (2022: £42.1 million)
down largely due to a movement in
our property revaluation. Our adjusted
operating margin remained resilient at
14.2%, down as expected from the prior
period margin of 16.6%, which was
heavily bolstered by government covid
support through business rate reductions,
lower VAT rates and grants. Our business
remains highly profitable and over the
coming months, as inflation is predicted
to soften, we are confident that margins
will improve.
Our strong financial position, driven by
healthy operating free cashflow has enabled
us to continue to invest significantly, with
total investment of £58.4 million in the
period (2022: £73.7 million), whilst still
reducing our net debt position. At the
period end, we remain conservatively
financed, with net debt (including lease
liabilities) of £165.2 million, being 1.9 times
our adjusted EBITDA.
It has been another active year on the
acquisition front as we added six new
pubs: the Bedford Arms (Chenies),
Carpenter’s Arms (Tonbridge), Half Moon
(Windlesham), Merlin’s Cave (Chalfont St
Giles), Wild Duck (near Cirencester) and
the award-winning Griffin Inn (Fletching)
in East Sussex. Across our existing estate,
we invested £34.4 million with notable
projects at the Bull (Streatham), Hare &
Hounds (East Sheen), Crown (Bow) and
the Elgin (Notting Hill). We continue
to explore opportunities to maximise
our trading areas through underutilised
space, with two beautiful examples at
Hort’s Townhouse, where we added 19
boutique bedrooms in central Bristol, and
the new roof terrace at the Marquess of
Anglesey (Covent Garden), which is due
to open next month.
We continue to have one eye on the
future, ensuring we have a steady pipeline
of new openings. In the second half of the
year, we transferred two of the remaining
tenancies back into our managed estate,
Bishop’s Vaults (Bishopsgate) and the
Clapham North (Clapham). The latter
was completed just days before the
period end, closing immediately for an
investment and will reopen later this
summer. Elsewhere, exciting projects are
due to get underway at the Constitution
(Camden), Wild Duck purchased earlier
this year, and the old bank site in
Farnham, Surrey, acquired back in 2018.
Our success as a business is dependent
on having great pubs with the best
people to operate them. I continue to be
impressed by the quality of the teams
we have in place. We focus on providing
high-quality training programmes and
development opportunities to give
our people the chance to flourish and
further their careers within Young’s.
Across our pubs, 73% of general
manager appointments have been
internal promotions. In September, I was
pleased to welcome Mark Loughborough
to the board following his promotion
to retail director, having been a valued
member of the Young’s team for 11 years
in a number of senior roles. I look forward
to seeing many more of our valued team
throughout the business progressing their
careers in the months and years to come.
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As a group, we are committed to building
a business which nurtures and develops
our people, makes a lasting and positive
contribution to the communities we
operate in, and respects the environment.
Not only is this vital to our future success,
but it will also enable us to deliver long-
term value for all our stakeholders. This is
covered in more detail within our annual
report on pages 24–43, as we continue
to embrace a more structured approach
to sustainability.
Recent trading and outlook
Since the period end, trading has been
positive with managed like-for-like sales
up by 4.8% despite the unseasonably
cooler and wetter start to spring, as we
were able to capitalise on the well-timed
Easter and bank holiday sunshine.
While the additional bank holiday for
the Coronation gave us minimal upside,
it was fantastic to see our customers
and pubs celebrating with local events,
highlighting the important role our pubs
play in their communities.
Last month we completed on the
freehold purchase of the Stag (Belsize
Park), located close to Hampstead Heath
in North London, adding further to our
presence in the capital.
We find ourselves living in challenging
times, including headwinds from high
inflation and the resumption of train
strikes, but there is plenty for us to
be excited about. This autumn, the
Rugby World Cup provides a fantastic
opportunity given our rugby heritage
and we are hopeful that further rail strike
disruption will be limited. The investments
and acquisitions made in the last two
years, alongside our future pipeline
provide tremendous growth potential.
The business is completely aligned to take
Young’s forward, and we are confident in
our ability to deliver superior returns for
our shareholders.
Simon Dodd
Chief Executive
24 May 2023
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Strategic Report
Our service excellence
Our highly trained and enthusiastic pub
teams work hard to consistently surprise
and delight our customers. We design
our pubs focusing on the needs of the
customer. The high service standards
we provide alongside the quality food,
drink and rooms on offer creates the best
possible experience for our customers.
We offer both back and front of
house apprenticeships, along with
robust training and development
for all of our people. The teams are
provided with valuable tools to enable
them to deliver excellent service.
Service excellence filters down into
everything we do at Young’s, from the
recruitment and training in our pubs,
to our people at Copper House.
Our aim as publicans is to provide
the best experience possible.
Surprising
and delighting
our customers
in every visit.
“ Our friendly, lively and
exceptional customer
service is convivial
hospitality at its best.”
Mark Loughborough
Retail Director
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Our strategy
Delivering growth through our three strategic priorities
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Investing in our estate
We look to grow through a combination
of investing in our existing pub estate and
opportunity-led acquisitions. Each year,
on average, we reinvest about two-thirds
of the cash we generate.
Hand-picked acquisitions
We invest in hand-picked acquisitions,
based in locations where we feel our
style of operation will thrive, as well
as benefitting the surrounding area.
All acquisitions have to pass our strict
internal investment criteria.
Investing in our people
We believe in investing in our people
and nurturing our own talent, so they
are able to continue to grow our pubs by
surprising and delighting our customers.
Our progress in 2023
• Transformational projects at Hort’s
Our progress in 2023
• The acquisition and investment of
Our progress in 2023
• Successfully reached our target of
Townhouse and the Hare & Hounds.
Alongside smaller schemes to ensure
our pubs remain premium.
• Long-term strategy to maximise the
two pubs, Merlin’s Cave and the Half
Moon. Our purchase of the Wild Duck
will remain closed while extensive
renovations are carried out.
300 team members registered with
the Ram Agency with people in a
range of roles, from general manager,
to chef and back of house.
potential from our remaining tenancies
through transfers to managed pubs,
success at the Clapham North and
Bishop’s Vaults.
• We acquired a further three premium
pubs with rooms, the Bedford Arms,
Carpenter’s Arms and the Griffin Inn,
adding 40 bedrooms to the estate.
• Fulfilled our strategy to recruit from
within the business, successfully filling
73% of general manager positions
with internal candidates.
Our priorities for 2024
• Our project at the Marquess of
Anglesey remains onsite and is due
to complete in June.
• We remain committed to identifying
opportunities to maximise the
potential within our existing estate
whilst ensuring that we maintain our
premium standard in all pubs.
Our priorities for 2024
• Strategically selected acquisitions
that meet our internal investment
criteria and possess potential. We are
in a strong position to capitalise on
opportunities that present themselves.
• In April, we completed the purchase
of the Stag, a freehold pub in Belsize
Park, London.
Our priorities for 2024
• Our aim is to have over 500 team
members registered with the
Ram Agency.
• We now have nine different
apprenticeship programmes across
the business, our aim is to have
200 apprentices.
£34.4m
Invested in our estate
£24.0m
Acquisition investment1
48
Current apprentices
11 12
11 12
10 12
The circled numbers refer to Principal risks and uncertainties on pages 44 to 47.
1 Includes post-acquisition investment.
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Strategic Report
Key Performance Indicators
We measure the development, performance and position of our business
against a number of key performance indicators. The reference to an ‘adjusted’
item means that the item has been adjusted to exclude non-underlying items.
These alternative performance measures have been provided to help investors
assess the group’s underlying performance.
Revenue £m*
This is our group revenue, mainly
consisting of our managed pubs.
Like-for-like revenue %
This is our revenue movement for this period
compared with the previous period for our
managed pubs that traded throughout
both periods.
RevPAR £
This is our revenue per available bedroom;
it is the average room rate achieved multiplied
by the occupancy percentage.
368.9
309.0
12.9
(2.9)
71.40
55.50
29.68
88.0
(72.1)
2021
2022
2023
2021
2022
2023
2021
2022
2023
Adjusted EBITDA £m*
This is our earnings before interest, taxes,
depreciation and amortisation adjusted
to exclude any non-underlying items for
the group. (See notes 11 and 12).
Adjusted profit/(loss)
before tax £m*
This is our profit/(loss) before tax from
continuing operations only, adjusted to
exclude any non-underlying items for
the group. (See notes 11 and 12).
Adjusted earnings/(loss)
per share (p)*
This is our adjusted profit/(loss) after tax,
divided by the weighted average number
of ordinary shares in issue.
(See notes 12 and 17).
82.5
85.5
41.8
45.2
56.26
64.29
(1.3)
2021
2022
2023
(43.2)
2021
2022
2023
2021
2022
2023
(66.63)
Gearing %
This is our net debt divided by our net
assets (expressed as a percentage).
Interest cover (times)*
This is our adjusted operating profit
divided by our finance costs.
Recycling (tonnes)
This is the amount of waste we recycle
and divert from landfill.
38.5
24.8
22.8
2021
2022
2023
7.0
5.4
6,237
4,351
4,433
(3.4)
2021
2022
2023
2021
2022
2023
* Results for 2022 are for continuing operations. 2021 comparatives have been restated.
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Our premium drinks offer
This year, we introduced a number of new
beers and ciders to our bar: Pravha, Brooklyn
Pilsner, Beavertown Young Sun, and Aspall.
We have elevated our range of alcohol-free
drinks to offer customers the choice, either
with or without alcohol. Quality alcohol-
free serves for all occasions include our first
draught alcohol-free lager, Estrella Free Damm,
as well as a selection of non-alcoholic cocktails.
And as our customers continue to favour
locally produced products, we introduced
Nyetimber, the world-renowned English
sparkling wine, to our pubs to great acclaim.
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Exciting, often
colourful and
always innovative.
“ We live in an
experience economy
where our customers
are always looking
for something a
little special.”
Gillian McLaren
Director of Marketing
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Strategic Report
Our latest acquisitions
The Bedford Arms, Chenies
(below and right)
This 18th century pub with 18
charming bedrooms is nestled in
the heart of the Chilterns between
Buckinghamshire and Hertfordshire.
Escape the hustle and bustle of city life
with the peaceful surroundings of the
Bedford Arms, the perfect place to enjoy
a glass or two of your favourite tipple.
We seek out new
pubs with character
and heritage.
“ We have a great team
who continue to seek
acquisitions that meet
our strategy to have
premium and well-
invested freehold pubs
across London and
the south of England.
We can bring Young’s
unique operating
experience to great
trading pub assets.”
Stuart Gallyot
Director of Property
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Merlin’s Cave, Chalfont St Giles
(left)
Located opposite the village green and
nestled beside the River Misbourne.
The pub includes a bustling bar area,
filled with home comforts, and a
gorgeous garden, perfect for a warm
summer’s day.
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Half Moon, Windlesham
(above)
The Half Moon is a country pub located
in the heart of the village, and plays an
important role in the local community.
Recently refurbished throughout, the
pub features a traditional bar area,
an oak-beamed dining room and a
wonderful garden.
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Carpenter’s Arms, Tonbridge
(above)
In keeping with the geography of recent
acquisitions, the Carpenter’s Arms is
located in the Kent countryside, on the
outskirts of Tonbridge.
The pub includes nine recently
refurbished bedrooms and features a
seated terrace to the front, with a hidden
garden to the rear, offering customers the
opportunity to dine or drink in one of the
unique rotunda huts.
Griffin Inn, Fletching
(right)
The award-winning pub comprises a
charming 16th century freehold coaching
house, with 13 bedrooms, nestled in the
heart of the East Sussex countryside.
Its expansive, two tiered garden has such
magnificent views that it is known locally
as the ‘Sussex Serengeti’.
Strategic Report
How we have engaged with our stakeholders
We believe that considering our stakeholders in key business decisions is
not only the right thing to do but is fundamental to our ability to drive
value over the longer term. Board directors are bound by their duties under
the Companies Act 2006 (the ‘Act’) to promote the success of the company
for the benefit of our members as a whole. In doing so, however, they must
have regard to the interests of all our stakeholders, to ensure the long-term
sustainability of the company.
The board is therefore responsible for ensuring that it fulfils its obligations to those impacted by our business, in its stakeholder
consideration and engagement. The following pages comprise our section 172(1) statement and describe how the directors have
had regard to the matters set out in section 172(1) (a) to (f) of the Act when acting in the way they considered, in good faith,
would be most likely to promote the success of the company for the benefit of its members as a whole. In line with guidance
issued by the Financial Reporting Council, this statement concentrates on matters that are of strategic importance to the company.
Where appropriate and to avoid duplication, the statement cross-refers to other sections within the annual report.
Customers
Our people
Section 172(1) statement
Principal stakeholder groups
The directors regard those listed
below as the company’s principal
stakeholder groups.
Set out in relation to each group is:
• Why the directors believed it was
important to engage with that group
(the Why?)
• The main methods used by the
directors to engage with that group
and to understand the issues that
concerned that group (the How?)
• Information on the effect on the
company’s decisions and strategies
during the period as a result of issues
raised by that group (the Outcomes
and actions)
Customers
Our people
Suppliers
Investors
Lenders
Trustees of the final salary
pension scheme
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Why?
The company’s source of revenue
is from customers in the group’s
managed houses, with drink sales
being 62.5% of managed house
revenue, food being 31.5%, and the
provision of accommodation being
6.0%. Lower revenue could lead to
lower profits. A customer’s decision
to spend their money can be
affected by a broad range of matters,
all set against a background of
consumer choice of where to go and
what to do. See also principal risks
and uncertainties 3 on page 44.
How?
See the Engagement with suppliers,
customers and others in a business
relationship with the company section
within the directors’ report, starting
on page 84.
Outcomes and actions
See the Engagement with suppliers,
customers and others in a business
relationship with the company section
within the directors’ report, starting
on page 84.
Why?
The commitment, skills and
experience of the people employed
throughout the organisation
(whether they are in the company’s
pubs or at Copper House) are
integral to the company’s long-term
success; amongst other things,
all of them have a part to play in
helping to continue to grow, and/
or support, the company’s business
and in demonstrating the company’s
values on a daily basis. They are our
most prized asset and staff retention
is therefore crucial. Consequently,
it is important that the company is
an ‘employer of choice’, provides an
environment in which people are
happy to work, supports the physical
and mental wellbeing of its staff, and
gives individuals the opportunity to
develop. See also principal risks and
uncertainties 10 on page 47.
How?
See the Employee engagement
section within the directors’ report,
starting on page 83.
Outcomes and actions
See the Employee engagement
section within the directors’ report,
starting on page 83 and Our people
section of the sustainability report
starting on page 24.
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Suppliers
Investors
Lenders
Why?
Continued access to capital is of
vital importance to the long-term
success of the company’s business.
Via its engagement activities, the
company strives to obtain investor
buy-in to the company’s strategy
of how to grow the business and
the company’s business model,
setting out how value is created.
The aim is to promote an investor
base interested in a long-term
holding in the company. See also
principal risks and uncertainties 7
on page 46.
How?
See the Shareholder relations section
within the corporate governance
report, starting on page 70, for
information on the company’s
main methods of engagement
with investors.
Outcomes and actions
The company’s investors remained
supportive of the company’s strategy
and business model.
Why?
The business relies, in the main, on a
small number of suppliers to provide
the company’s pubs with food and
drink. The range, availability and
quality of the products sourced
is fundamental to the company’s
reputation. To remain as a provider
of a market-leading, competitive
premium offering that new and
existing customers would want
to enjoy, it is important that the
company partners with the right
suppliers, and has good, strong
and mutually beneficial business
relationships with them. 82% of the
company’s spend is with 5% of its
suppliers. See also principal risks and
uncertainties 4 and 8 on pages 45
and 46.
How?
See the Engagement with suppliers,
customers and others in a business
relationship with the company section
within the directors’ report, starting
on page 84.
Outcomes and actions
See the Engagement with suppliers,
customers and others in a business
relationship with the company section
within the directors’ report, starting
on page 84.
Why?
Lenders are an additional important
source of capital. As it does with
its investors, the company looks to
get buy-in from its lenders to the
company’s strategy and business
model. The intention is to develop
supportive, long-term relationships.
See also principal risks and
uncertainties 7 on page 46.
How?
The chief financial officer regularly
spoke with the company’s banks and
noteholders. Further, as required
under the terms of the company’s
loan facilities, they received quarterly
covenant compliance certificates.
Outcomes and actions
The company’s lenders remained
supportive of the company’s strategy
and business model. Following the
return to normal trading conditions,
discussions between them and the
company returned to focusing on
the company’s material activities
(including acquisitions and disposals)
and any appetite to increase
borrowings. Further discussion
took place on the general trading
environment. Particular discussions
took place with NatWest concerning
the £30.0 million term loan which
was due to mature at the end of
March 2023, and was subsequently
repaid during March 2023 (see the
following page).
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Strategic Report
How we have engaged with our stakeholders continued
Section 172(1) statement continued
Trustees of the final salary pension scheme
Outcomes and actions
Discussions primarily focussed on
funding, investment and employer
covenant considerations, ensuring
an integrated approach to risk
management. Strategic scheme
initiatives, such as the approach to
liability management and minimising
volatility, were discussed; these saw
the trustee continuing with a carefully
designed strategy to manage liabilities
and underlying scheme risk, all against
the background of the scheme’s
continuing maturity. The company
reviewed a comprehensive update
on the performance of the scheme’s
liability-driven investment strategy,
which had performed in line with
expectations, and it was regularly
updated on scheme funding,
membership changes and other key
details. Other legislative developments,
such as the action to be taken
as a result of the need for GMP
equalisation and the new regulatory
funding code consultation were noted.
The company’s views were sought on
the approach to the schemes maturity
and potential timeline for reaching
buyout. The trustees’ requested a
discretionary increase for the year
starting 1 April 2023. Overall, because
of the company’s engagement and
the proactive appropriate stewardship
of the trustee, stable contributions
continued to be paid to the scheme
(as has been the case for many years)
and the company benefited from
funding savings resulting from liability
management initiatives.
Why?
The company operates a defined
benefit pension scheme covering
benefits payable to various current and
former employees; the scheme was
closed to new entrants in February
2003. The scheme is a key company
financial commitment as it needs to
be funded to meet agreed benefit
payments and regulatory pension
funding requirements. The scheme’s
trustee is Young’s Pension Trustees
Limited, a corporate trustee.
The company recognises that the
trustee and the company each has a
vital role to play in the proper running
of the scheme and that regular, clear
and open communication and, where
necessary, consultation is important
in helping maintain a good working
relationship between the company
and the trustee. The company is party
to all scheme deeds, undertaking
responsibilities under the scheme’s
trust deed and rules together with
pension legislation and regulation, as
required. See also principal risks and
uncertainties 6 on page 45.
How?
During the period, the chief financial
officer worked closely with the trustee.
The chief financial officer attended
meetings with the trustee and delivered
presentations on the company’s
business, thus keeping the trustee
informed of the company’s financial
position and of any plans that would
change or impact upon the employer
covenant supporting the scheme.
In addition, the chief financial officer
was invited to join scheme investment
discussions. The chair of the trustee is
a director of the company and gave
presentations to the company’s board
on various aspects of the scheme.
Principal decisions
For the purposes of this statement,
the directors regard their principal
decisions as not only those that are
material to the group, but also those that
are significant to any of the company’s
principal stakeholder groups. Set out
below are the principal decisions made
by the directors during the period;
implicit in making these was the
desirability to maintain a reputation
for high standards of business conduct
and the need to act fairly as between
members of the company.
Approval of capital and
revenue budget for FY24
The capital and revenue budget for FY24
was approved by the board in March
2023. Despite ongoing cost challenges,
the board believes that the company’s
premium offering would remain attractive
to existing customers and act as a draw to
new ones. The company’s business model
and budget would allow the company
to continue to invest in its people and
pay them appropriately, and capital
would continue to be available to enable
selected hand-picked complementary
acquisitions to be made. The company’s
plans, underpinning the budget, are
demanding but will position the company
well against its longer-term value creation
vision whilst honouring its commitments
to its stakeholders.
Liquidity position: repayment
of the £30.0 million loan
facility with NatWest,
which was due to mature
in March 2023
During the period, the board considered
the company’s liquidity position and
ability to generate cash, in the context of
its strategy for the business, and took the
decision not to renew its £30.0 million
loan facility with NatWest. This was
subsequently repaid during March 2023.
In taking the decision to repay the loan
facility, the board remains comfortable
that the company has sufficient financial
resources to develop its existing business
and exploit opportunities as they arise.
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Acquisitions of new
managed houses
During the period, the company
acquired the following freehold pubs
as part of the group’s managed house
estate: the Bedford Arms (Chenies),
Merlin’s Cave (Chalfont St Giles), Half
Moon (Windlesham), Carpenter’s Arms
(Tonbridge), Griffin Inn (Fletching)
and the Wild Duck (near Cirencester).
Details of the consideration paid, and the
associated costs are set out in note 15
starting on page 119. The acquisitions
were made to support the company’s
value creation acquisition strategy: right
opportunities in existing or exciting new
locations where the board believes the
company’s premium offering will flourish.
The purchases were financed from the
company’s cash reserves.
Property disposal
During the period, the company agreed
to sell the Bridge Hotel (Greenford).
The team transferred to the new owners
under the TUPE regulation on existing
terms. The challenges facing this property
meant that its sustainability was in
question; as such, a sale was considered
the appropriate approach and consistent
with the company’s strategy. Details of
the consideration received and associated
costs are set out in note 11 starting on
page 117.
Board changes during
the period
Simon Dodd was appointed chief
executive on 5 July 2022, succeeding
Patrick Dardis who stepped down as
chief executive at last year’s AGM and
from the board on 30 September
2022. In addition, Mark Loughborough
joined the board as retail director on
30 September 2022. On 1 March 2023
Sarah Sergeant joined the board as an
independent non-executive director.
Stephen Goodyear and Nick Miller were
invited to stay for a third three-year term,
through to 3 April 2026. Further, inherent
in all of these decisions was the balance
between executive and non-executive
directors, the importance of having an
appropriate level of independence and
female representation on the board, and
the board having an appropriate number
of members (with the right experience,
knowledge, standards, skills, personal
qualities and capabilities) for the company,
its reputation and long-term strategy.
Payment of a final dividend
in respect of FY22 and
payment of an interim
dividend and final dividend
in respect of FY23
Following a board recommendation and
shareholder approval of the same at the
company’s 2022 AGM, a final dividend
of 10.26 pence per share was paid to
shareholders in July 2022 (at a total
cost of £6.0 million), this was followed,
in December 2022, by payment of an
interim dividend of 10.26 pence per share
(at a further total cost of £6.0 million).
These payments were anticipated in the
revenue and capital budget for FY23
approved by the board in March 2022.
Funds to pay these dividends were from
the group’s free cash flow. The company
will recommend the payment of a
final dividend to shareholders for the
financial year ended 3 April 2023 at the
company’s 2023 AGM.
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Strategic Report
Sustainability report
We are passionate
about building a
sustainable company.
Our sustainability programme focuses on three core areas:
Our communities
• We play a positive role in our communities
and give back where possible.
• We celebrate the best of British and champion
local suppliers throughout our menus.
• We do our utmost to support our suppliers
and be fair commercial partners.
Our people
• We focus on the wellbeing of our
colleagues with comprehensive
financial and mental health support.
• We engage and empower our
teams with regular communication
and commitment to their
career pathway.
• We foster diversity and
inclusion through our
approach to appointments
and training.
Our environment
• We aim to reduce, reuse
and recycle our waste in
the most sustainable
way possible.
• We implement new emission-
saving technologies across
our estate.
• We work closely throughout
our supply chain to improve
the environmental impact
of our produce, from farm
to fork.
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Our approach
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Our approach to
sustainability
Young’s is a company with a long
heritage, and we are committed to
building a business which nurtures
and develops our people, makes a
lasting and positive contribution to the
communities we operate in, and respects
the environment.
As a company, we have invested in
sustainable and responsible business
practices for a number of years, but
we recognised last year that a more
structured approach to sustainability
was needed going forward. We have
adopted a clear governance framework,
which is explained below, and we are
focused on defining our Environmental,
Social and Governance (‘ESG’) strategy
and identifying our priorities. We have
engaged our teams to raise the profile
of sustainability and during the period
initiatives have been implemented which
encourage behavioural change. We have
worked with external advisors to gain
a clear understanding of the steps we
need to take to reduce our Scope 1
and 2 emissions.
Our ESG governance
framework
A clear ESG governance framework
has been adopted in which the board
has oversight of our strategy, and the
executive committee considers and
implements operational initiatives
and monitors their progress. Our first
sustainability manager joined the company
in May 2022 and their role is to
provide leadership and ensure that we
are taking a coordinated approach to
sustainability throughout the business.
The management board, which is
composed of our executive and leadership
teams, receives regular ESG updates from
the sustainability manager. The senior
leaders on the management board are
empowered to engage with their internal
and external stakeholders to deliver
the part of our ESG strategy which is
most relevant to their individual areas of
expertise. Aisling Meany is the board’s
non-executive director for ESG and works
with the company secretary to develop
our governance model.
Our net zero approach
The company is a founding member of
the Zero Carbon Forum, a collective of
hospitality businesses which has created
a ‘Roadmap for Hospitality to Net
Zero’ ahead of the UK Government’s
commitment of 2050. The company has
aligned itself with the industry’s roadmap
which requires that, as a collective, we
are aiming to achieve net zero for our
Scope 1 and Scope 2 emissions (our
direct company emissions) by 2030.
The roadmap is being driven by the
Zero Carbon Forum and is designed
to provide the hospitality sector with
guidance on the steps we can take to
decarbonise our business and implement
a net zero strategy. We have engaged
Savills Earth to advise and support us as
we develop our implementation plans
and further information is available in the
Our environment section of this report.
“ We have a responsibility
to do the right thing
and a long tradition of
supporting our people,
our communities and
adopting carbon saving
initiatives. As a board,
we know there is still
much to do, but we
believe that we can
deliver a meaningful
contribution for all
our stakeholders.”
Simon Dodd
Chief Executive
Maximising energy
efficiency
Hort’s Townhouse
Hort’s Townhouse was our largest
investment during the period.
It has been redeveloped to BREEAM
standards, with the aim of ensuring that
the new development has maximised
the potential for improvement
in energy efficiency within the
building structure.
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73%
of our general managers
were internal appointments
Offering our team members a career,
rather than a job, means we are able
to retain and develop our people and
promote from within.
Strategic Report
Our people
We develop
and nurture
our people.
“ Diversity and inclusivity
underpin our policies and
culture at all levels
throughout Young’s.
We are fully aware that
everything we achieve as
a business, we achieve
through the dedication
and efforts of our teams.”
Gail Khan
Director of HR
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Developing our
team members
Lucy Barrett and Marco
Bagni, Finance Team,
Copper House
Lucy and Marco joined the company
in 2014 and 2007, respectively,
as front of house team members.
Both progressed through the
company’s career pathway to take
on management positions. In 2017,
Marco joined the finance team as
an operations support manager, and
he was appointed as a head office
accountant in 2022. In 2019, Lucy
began exploring opportunities within
the finance team and joined as a
cashier in 2019, before moving to
the purchase ledger team last year.
In 2022, the company sponsored
Lucy and Marco to train for the AAT
qualification, as part of the company’s
apprenticeship programme.
They have both successfully
negotiated level three and they start
level four later in the year.
Training and development
The company’s ‘career pathway’ is used
to engage, inspire, and develop our
teams. Beginning at team member level,
the career pathway offers a broad range
of development opportunities for our
front of house teams, through to general
manager level and then on to operations
manager. We also have a comprehensive
programme for our kitchen teams, and we
are proud that our kitchen assistants have
the opportunity to develop into our head
chefs of the future.
A comprehensive project to streamline
our training was undertaken during
the previous period and the company
launched its digital career pathway in May
2022. The career pathway is delivered
digitally via The Ram app or a desktop
version which can be accessed through
an internet browser. It is available to all
team members throughout the business
and is fully interactive and flexible across
job roles. It also means that we are
completely paperless, which is a huge cost
saving to the business and follows our
sustainability strategy.
Realising and
developing potential
Junior Lindie, General
Manager at the Halfway
House (Earlsfield)
Junior started working for Young’s
in 2014 as a glass collector at
the Castle, Tooting. Since then,
he has progressed through the
company’s career pathway and
was appointed deputy manager
in 2019. In 2022 Junior started
the company’s general manager
designate programme and he is
now the general manager at the
Halfway House.
The company offers a comprehensive
programme of training and development
courses which are run by our in-house
trainers and are available to all our
pub teams. The company has offered
Commis Chef Level 2 and Hospitality
Supervisor Level 3 apprenticeships for a
number of years. During the period the
company’s apprenticeship programme
was expanded to include a broad range
of new apprenticeships, such as hospitality
manager, operations management,
coaching, and learning and development.
There are also options available for our
Copper House employees within their
areas of expertise. Our aim is to have
200 apprentices by the end of 2024.
The company’s first graduate programme
will be launched in September and the
two successful applicants will work within
Copper House and with our operations
teams over a two-year rotation.
Our service masters continue to be a
key part of our teams in each business,
responsible for inducting and training
new team members and imparting their
knowledge of service and standards,
ensuring every team member has the
knowledge and confidence to delight
our customers.
Internal succession
We aim to promote internal succession
above external recruitment and support
our teams in achieving this objective.
Starting with our career pathway, internal
succession within Young’s remains one
of our key strengths. Offering our team
members a career, not just a job, means
we are able to retain talent within the
business, many of whom go on to run our
pubs and kitchens. In the last year 73%
of our general managers were internal
appointments. Around half of those
appointments are deputy managers who
have graduated from our internal general
manager designate programme, and gone
on to run their first pub. The other half are
general managers who have moved to a
more challenging and complex pub.
As a result of our career pathway, the
company has many examples of staff
who have progressed through our
programmes and are now in leadership
roles within the business and we have
included some case studies in this report.
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Our people continued
Supporting employees to
realise their career goals
Chris Saunders, General
Manager at the Crown
& Anchor (Chichester)
Chris started his career with Young’s
as a part-time team member in
2014 at the Crown & Anchor.
Soon after he became a full-time
team member and he rose through
the ranks to become deputy manager
and participate in the company’s
management academy. In 2018
he was appointed general manager
at the Leather Bottle, Earlsfield.
His dream was always to return to
the Crown & Anchor and in 2023
his dream came true when he was
appointed general manager.
Employee involvement
The importance of good communication
with our teams is fundamental to the
continued success of the company.
We take great care to ensure that all
employees are kept well informed
of developments within the business
throughout the year.
Employees are encouraged to use The
Ram app, delivered by the company’s
e-learning platform, to access the ‘How
are You?’ and ‘Keeping in Touch’ pages,
which include a range of information
and resources to keep employees up to
date, and enhance and maintain their
mental, physical, and financial wellbeing.
Using The Ram app to communicate with
employees ensures that the company can
communicate directly with every team
member across the company, regardless
of their location or working pattern which
means that employees working flexibly
are not excluded from communications.
Employees have full flexibility to read and
participate in discussions at work, while
travelling or at home.
physical health as well as fun activities
for employees to do outside of their
working day.
We also work with The Burnt Chef
Project, which was set up with the sole
intention of eradicating mental health
stigma within the hospitality industry.
We offer a range of their resources via
the ‘How are You?’ page on The Ram
app, such as the Going Home Checklist,
Wellness Action Plan and The Burnt
Chef Journal Podcast. These resources
help raise the profile of mental health
within the company and provide tools to
enable employees to monitor their mental
state and help managers improve their
employee conversations.
We offer counselling for those in need
of someone to talk to. This includes
fully funded, confidential, one-to-one
counselling sessions with a qualified
professional, provided via a 24/7 free
confidential telephone counselling service.
The company continues to partner with
Salary Finance to offer free support and
advice to employees to help them live
healthier, happier lives through the current
and future financial decisions they make.
Working with Salary Finance, we run a
financial support programme aimed at
helping our staff get out of any financial
difficulties they may find themselves in,
by offering affordable loans which give
staff access to their salary as it is earned.
During the period, over 250 employees
sought their help and advice, and several
employees took advantage of the loan and
debt support they provide.
We continue to provide information about
a range of topics, including the support
available to employees from the Licensed
Trade Charity, who provided financial
grants to a number of our team members
during the period. Please see page 83
of the directors’ report for further details
of the company’s employee health and
wellbeing programme.
The company’s digital monthly magazine
‘The Ram Pages’ is distributed to all
employees. It features team contributions
and updates, details of new acquisitions
and pub re-developments, recipe
inspirations, company benefits, wellbeing,
internal vacancies, competitions and much,
much more.
We also engage with our employees
and their representatives through the
company’s information and consultation
committee. This committee works to
enhance communications within the
company, supplying information and
giving opportunity for feedback and
consultation. It improves employee
awareness and involvement and supports
ongoing improvements within the
business. Please see page 83 of the
directors’ report for further details of
the workings of the information and
consultation committee.
As part of ongoing efforts to improve
direct access to the executive directors’
and management board members, a
‘Dinner with Directors’ initiative was
introduced during the period. Each month,
an executive director, with a management
board member, hosts a dinner with
invited general managers, head chefs
and head office-based employees, where
in a relaxed and informal environment
employees can meet and speak with
senior company representatives.
Employee health
and wellbeing
The health and wellbeing of our
employees is vitally important to us.
We aim to create safe and healthy
working environments where employees
can thrive and continue working with
us. Our well-established wellness
projects cover mental, physical, and
financial wellbeing.
The cost of living crisis has led to an
even greater focus on mental health and
wellbeing. We continue to work hard to
build an in-house team of mental health
first aiders and mental health first aid
champions who support their colleagues
across the business. The ‘How are You?’
page on The Ram app provides a variety
of content to help with mental and
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Flexible working –
Ram Agency
There is a growing desire for flexible
working and achieving a healthy work-life
balance. To cater for this, we launched
our own internal recruitment platform
in August 2021, which aims to give
registered employees the power to pick
their own working hours. They can view
shifts online and build their own rota to
suit their lifestyles. Shifts are available
daily across our estate of 223 trading
managed pubs and prospective staff can
apply online. The platform has given us
access to a new pool of people: students,
actors, travellers, parents and many more
who would find it difficult to commit to
traditional working patterns. We have
received some excellent feedback, a
snapshot is captured below:
“The Ram Agency has been incredible
for us this year. Given the seasonal
nature of the Canonbury, being able to
find an extra few pairs of hands at short
notice, has been key to maintaining
great service while not overspending on
our wage budget. The standard of team
members available through the agency
has always been of high quality,
they are fully trained and know our
systems which has really helped us.”
Tom Richards
General Manager, Canonbury, Islington
“The main reason I joined the Ram
Agency was the flexibility around
working evenings and weekends.
Being a single father, having that
flexibility is extremely important.
With the agency, I can still work a
full-time week without having to
commit to a lot of evening and
weekend work. It’s perfect for
me at this moment in my life.”
Jake Martin
Head Chef, Ram Agency
We are proud of the agency’s success.
At the date of this report, over 350
employees were registered with the
agency, covering front of house, kitchen,
and restaurant roles, and over 17,200
agency hours were worked across more
than 1,400 shifts in December 2022.
Our aim is to have over 500 employees
registered with the agency by the end
of FY24.
Diversity and inclusion
It remains our commitment to ensure
that every team member is treated
with fairness, dignity and respect and
has access to the same rewards and
opportunities. This supports and underpins
our sustainability commitment to our
teams. Diversity and inclusivity influence
our policies and culture at all levels
throughout Young’s; we are fully aware
that everything we achieve as a business
we achieve through the dedication and
efforts of our teams.
We are focused on the recruitment and
development of the best talent, and we do
not discriminate based on gender, race,
ethnic origin, disability, sexual orientation,
religion or belief, marital status or age.
We employ the best person for the
job, developing our talent internally to
promote from within and retain valuable
employees within our company.
The importance of diversity is
acknowledged in making any
appointment as well as employees’
subsequent training, career development
and promotion. The board believes that
all appointments should be merit-based
against the selection criteria created for
each role.
5,654
Employees
(2022: 5,275)
6.2%
Median Gender Pay Gap
(National Average: 14.9%)
Gender pay gap
The company’s mean gender pay gap
is 10.3% and median gender pay gap is
6.2%, which remains substantially better
than the national average median gender
pay gap of 14.9% (National Office of
Statistics’ Annual Survey of Hours and
Earnings 2022). The group’s full gender
pay gap report is available on our website.
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Gender diversity
The advancement of women in the
workplace remains vital to Young’s
ongoing success and we want to
ensure that women have access
to every opportunity in order to
progress to top roles.
Board (%)
30
70
Female
Male
Leadership team (%)
40
60
Female
Male
All employees (%)
43
57
Female
Male
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Our community
We proudly support a
number of charity and
community activities.
Our pubs are at the heart of their
communities, and we take great pride
fulfilling our role as key hubs, whether
it is in combating loneliness through
‘Meet up Mondays’ at the Alexandra
in Wimbledon, organising weddings
or enjoying the rugby. Pubs are an
integral part of British life, and we
have the power to unite people and
communities and make memories.
We are delighted that our charitable
initiatives have raised over
£100,000
during the period under review.
We are a keen supporter of
local and national charities and
during October our head office
and pub teams staged a range
of events as part of ‘Giving
in October’. A selection are
featured overleaf along with an
introduction to our new charity
partner – Wooden Spoon.
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Cherry Trees – child first, disability second (below)
As part of the company’s self-development
program (‘SDP’), which is open to our
general managers, head chefs and
Copper House team members, the FY23
participants were tasked with developing
a fundraising initiative. One of the teams
chose to support the Cherry Trees charity,
who provide fundamental short-break
respite visits for children and young
adults with a range of complex disabilities.
The SDP team invited several children
from the charity to visit the company’s
Food Development Learning Centre, in
Wandsworth, to create their own special
dessert. The winning dessert was an Eton
Mess and several of our Surrey based
pubs then created their own unique style
of Eton Mess puddings for their summer
menus, with a £1 donation from each
pudding sold going to the Cherry Trees
charity. This was an opportunity to raise
money for the charity as well as a fantastic
experience for the children and great
development for the SDP participants.
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Wooden Spoon - our new
charity partner (above)
As a company we are thrilled to be
partnering with Wooden Spoon, the
children’s charity of rugby. During the
year the company will fundraise for
initiatives such as: assistance dogs for the
blind, purchasing wheelchairs for local
clubs to make rugby more accessible,
Maddy’s Mark (positive mental health
for women through rugby), School of
Hard Knocks (getting people back on
their feet through the sport) and Pass the
Plate (a food bank initiative). We will take
advantage of the opportunities supplied
by Wooden Spoon to host events with
key players and commentators and
get our teams involved in volunteering
opportunities. We have pledged to
raise over £150,000 for the charity
during FY24.
The Royal Marsden (above)
The Greyhound, Carshalton has a long
history of raising money for The Royal
Marsden, a charity dedicated to the study
of the treatment of cancer based in Sutton
and Chelsea. During October they got
together with several local Young’s pubs
to organise a range of events and raised
over £14,500.
Ambitious About Autism (left)
Our east London pubs dressed as Dolly
Parton and cycled ‘9 to 5’ on an exercise
bike for the Ambitious About Autism
charity. The team covered over 160
kilometres and raised over £4,200 for
the charity.
Battersea Dogs & Cats Home
(above)
Our pubs within the Battersea area chose
Battersea Dogs & Cats Home as their
charity. In theme with the charity, they
hosted a number of dog related events.
This included a 12-mile dog walk around
the 14 participating pubs, with a visit to
the charity. All in all, they raised £3,477.
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Our community continued
Looking after our customers is central to everything we do. Our pubs are
highly valued and are integral to the communities in which they operate.
Customers
We provide a relaxed and safe
environment where friends and families
can spend time together. Our focus
on responsibly sourced, seasonal and
local British produce lends itself to
nutrient dense food that tastes delicious.
As customer tastes and eating habits
and styles have evolved, we have
enthusiastically adopted more plant-based
options on our menus, throughout our
estate. This is embodied by our new
Burger Shack menu which offers popular
plant based alternatives. Every pub must
include one vegan and one vegetarian
dish on their menus and many offer a
number of vegan and vegetarian dishes.
Our Food Development Learning Centre
at Copper House provides the right
environment for our chefs to experiment
and innovate using seasonal ingredients
to create new dishes for evolving
customer tastes.
All of our pubs use the Reputation
platform which generates an aggregate
score for each pub based on a range
of factors, such as Google ratings and
review platforms. The platform helps our
pubs to understand their local customer
preferences and concerns and provides
actionable insights. It also allows our
management teams to identify any
problem areas. The Reputation platform
is a key tool for us, and all our pubs have
been tasked with improving their score.
City to Sea – Refill app
During the period we relaunched the
‘Refill’ app across our pubs. With the
lifecycle of a plastic bottle taking 450
years to decompose the ‘Refill’ app
helps people to find places to refill
their water bottle, which is why we’re
using their app to offer free water
refills to anyone who needs it, thereby
helping to reduce the consumption of
plastic water bottles.
Making a difference
‘Food for Thought’
dinner series
We are passionate about seasonal,
premium, and sustainable British
produce. During the Autumn we
ran our ‘Food for Thought’ dinner
series in a selection of our pubs,
in partnership with Plymouth Gin.
The seven-course menu was based
around invasive, underutilised, and
abundant foodstuffs found in the
UK. It was designed to encourage
diners to be mindful about their food
choices and included ingredients such
as goat, seaweed, Dorset snails and
wood pigeon.
Mick and Sarah Dore,
General Managers, the
Alexandra (Wimbledon)
Mick and Sarah introduced ‘Meet
up Mondays’ in 2018 as a way of
overcoming loneliness, by providing
an opportunity for local residents
to visit the pub every Monday for
free tea, coffee and a selection of
sandwiches. The initiative provides
companionship and community
support, and the event now has a
large Facebook community. Mick and
Sarah truly are an inspiration, they
open the Alexandra’s doors on
Christmas day for their ‘Don’t be on
your own at Christmas’ campaign
providing a free Christmas dinner
to anyone who would otherwise be
spending Christmas alone. They even
go as far as having a selection of
volunteers delivering Christmas
dinners to local residents who are
housebound. Mick was awarded
the British Empire Medal at the late
Queen’s Platinum Jubilee last year,
deserved recognition for the amazing
contribution they make to their
local community.
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At Young’s we pride ourselves on procuring the
finest British landed day boat caught fish, ethical
and assured meat, game and poultry, artisanal
cheese along with the best in class, naturally
grown in abundance fruits and vegetables.
We partner
with local
producers
and suppliers.
“ By buying locally from
our community of local
producers we ensure
the freshest and best
ingredients, reduce
our carbon footprint
and operate a
sustainable
supply chain.”
Chris Knights
Director of Food
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Our community continued
Despite our proud origins in the London Borough of Wandsworth, our
geographical reach has grown, and with it our enthusiasm for local food and
drink suppliers that celebrate the best of British wherever our pubs reside.
Where appropriate,
we fully encourage
our pubs to explore
their individuality and
support local businesses.
We are proud to have
always done our best
to ensure suppliers
received payments in
a timely manner for
the wonderful produce
they provide.
Some of the British suppliers we work with
are detailed below and on the next page:
Our pork – Dingley Dell
A third-generation family of farmers
rear our free range, RSPCA assured
pork on the East coast of Suffolk.
With a deep love and respect for the
countryside and agriculture, Mark
and Paul Hayward are committed
to farming in harmony with nature,
improving the number and variety
of species living within the farm.
The animals are reared to RSPCA
and free range assured standards,
ensuring the animals have an
enriched life and living conditions.
We’re proud to serve the variety of
cuts on our menus and treat our
produce with the utmost respect.
Sourcing fantastic quality produce,
simply prepared, seasoned, and
cooked to perfection, we are letting
it be the star of the show.
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Our crockery – Surrey
Ceramics
We are delighted to partner with
Surrey Ceramics who produce
premium products for many of our
pubs. With every piece hand-checked
with a remarkable eye for detail, their
ceramics truly showcase the very
best of British craftmanship and they
have a key focus on sustainability.
From eliminating all waste in
their initial clay making process to
reducing their energy usage by
installing invertors on the motors
used to run their kilns. They have
fitted solar panels on their roof to
produce clean renewable energy and
they are now exploring further green
initiatives including heat recovery
opportunities from the excess heat
used in their kilns.
The company is run as an employee
benefit trust, and all their employees
have a direct interest in the success
of the business. As we have found
from meeting their team members,
the company has a significant focus
on the wellbeing of their past, present
and future employees.
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Cured fish – Severn
& Wye
Master smokers, Severn & Wye, have
been curing fish for more than 30
years, after founder Richard Cook
discovered a passion for seafood
aged just 19. At the Severn & Wye
smokery, a traditional smoking
process is preferred, and most of the
grading, cutting, filleting, and curing
is done by hand. Severn & Wye chip
all their own oak wood, giving their
smoked salmon a totally unique taste
that you won’t find elsewhere.
Beginning as a family business, the
family feel is still an integral part
of the culture of Severn & Wye,
with several team members having
worked there for over a decade.
With an incredibly impressive array
of sustainability credentials, Severn &
Wye are working towards having a
zero-carbon footprint and absolutely
no fish waste. Over the past 20 years,
they have only felled five oak trees to
craft their state-of-the-art smoker, and
these have been replaced by 350
British deciduous trees.
We will continue to work with our
suppliers to develop joint initiatives and
provide positive social and environmental
messages to share with our customers and
wider stakeholders.
These initiatives range from commitments
to use electric and/or hydrogen vehicles in
urban operating areas, reducing packaging
waste and implementing paperless deliveries.
Today more than ever, our customers
expect an interesting soft drink range
when visiting our pubs. We have put
a lot of thought and care into our
premium soft drink offering and our
range includes a selection of delicious
low sugar, non-alcoholic drinks, to suit all
needs. A number of which are must stock
items in our pubs under our ‘soft drink/
no and low stocking policy’. Our low
90%
Of our ingredients are
sourced from the UK
Charity crackers
This year we sourced Christmas crackers
made from FSC certified recycled board,
containing either a cardboard or wooden
Christmas tree decoration and an
environmental quiz question.
Our suppler has donated 10% of their
sales to the Teenage Cancer Trust, our
share of those sales raised £4,770 for
the charity.
alcohol drinks range is also expanding
as our suppliers adapt to the change in
customer preferences. During the period
the company launched its first draught
alcohol-free lager, Estrella Free Damm,
which is now listed in 60 of our pubs.
Allergy notices are included on all our
menus inviting customers to discuss their
needs with us, and calorie labelling was
included on menus from April 2022.
Seasonal celebrations
The Christmas period is always the
company’s busiest time of year and as we
all know Christmas is a time for giving,
which is why we celebrated the season
by working in partnership with several
remarkable organisations supporting both
people and the planet.
Trees for trees
In partnership with Absolut, the company
pledged to deliver a more sustainable
Christmas in association with More Trees,
planting an actual tree for every ‘cocktail
tree’ sold in our pubs. This initiative
with Pernod Ricard UK is estimated to
remove up to 36 tonnes of CO2 from
the atmosphere throughout the trees’
growth life.
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Our environment
Our focus during the period has been on looking at ways to reduce our
Scope 1 and 2 carbon emissions. With the knowledge that we cannot
manage what we don’t measure, we have reviewed our processes,
assessed our data and identified the gaps.
We are now in the process of taking
appropriate steps to enable the business to
make informed decisions going forward.
This will involve building the infrastructure
to enable us to measure and report on
our progress.
tCO2e (net) per
£ million of revenue:
54.47
28.21
26.98
Base year
2022
2023
This year, as part of our sustainable
journey, we now source 100% of our
power renewably from our group
energy contract. Green electricity
is dual reported in line with SECR
requirements. We have also
established FY2020 as a base year.
Net zero carbon pathway
The development of a net zero carbon
pathway is a significant task and we want
to do it properly. We have realised that
before we set targets, we need to know
more about our properties so that we
can identify the actions that need to be
taken, plan our approach and phase our
investments. As a result, we engaged
Savills Earth last year to advise and
support us on this journey and we agreed
the following phased approach:
Phase one:
To review our baseline carbon assessment
and benchmark carbon emissions for each
property to sense check results.
Phase two:
‘Our Net Zero Carbon Pathway
Development’: this involves grouping
our properties into categories based
on building age, condition, servicing
and heritage status. From that, we will
develop net zero implementation plans
for each category and set out a timeline
of interventions. This will enable us to
establish an overall pathway to net zero
for our properties.
Phase three:
The final phase is the setting up of
ongoing monitoring and reporting.
We appreciate that net zero reporting and
frameworks require regular verification
and disclosure so that the company can
demonstrate progress against its carbon
reduction targets.
We are currently working through
phase two of the project. Savills Earth
have reviewed our estate and grouped
our pubs into seven key categories,
classifying the potential opportunities
and restrictions we face within each
category. This will allow the business
to take informed decisions when
deciding which interventions to prioritise.
The interventions are currently being
reviewed and we will then develop our
investment timeline and establish our
short, medium and long-term targets.
We expect to complete phase two by
the end of FY24.
The challenges we face:
The cost
The required investment will need to be
phased and we are conscious that some
technology is not yet fit for commercial
use. We will continue to work with
suppliers, collaborate with our peers and
monitor the development of the relevant
technologies. We will run trials where
appropriate and adopt technologies in
line with our investment cycle, as the
costs reduce, and the stability of the
technology improves.
Statutory building restrictions
Listed building status and conservation
areas represent a significant challenge,
bearing in mind that 40% of our pubs
have listed status. We will work with
Savills, our suppliers and statutory
authorities to identify potential solutions
to these challenges.
Availability of energy resources
We continue to work with energy
suppliers to identify infrastructure
improvements which will help us move to
sustainable forms of energy, this includes
new on-site electrical substations where
the site layout allows for this addition.
Remote pub locations
They can provide significant challenges for
carbon reduction. We are working with
energy suppliers to try and upgrade the
infrastructure into these properties where
the supply is capable of being moved to a
carbon efficient model.
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Our sustainability partners
We partner with environmental leaders in order
to increase our knowledge and help us approach
our environmental challenges in the right way.
Zero Carbon Forum
Our Scope 3 carbon emissions
As a company we know that most of
our carbon emissions lie within Scope
3 (activities from assets not owned or
controlled by the company, but by
those that we are indirectly responsible
for, up and down our value chain).
Due to the complexity of calculating our
footprint, we have taken the pragmatic
approach to partner with Zero Carbon
Services in order to help calculate
our footprint, identify major emission
sources, and help us target reduction
opportunities across 10 key categories.
See page 42 for our Scope 3 baseline.
Save While You Sleep
We are working with Zero Carbon
Services in order to reduce our
overnight energy wastage at a site
level. This has allowed us to detect
clear energy saving opportunities,
simply by turning key pieces of
equipment off during the night
when it’s not in use.
As one of the founding members
of the Zero Carbon Forum we
will continue to actively engage
and participate, helping to shape
the hospitality industry’s approach
to sustainability.
We work closely with the Zero Carbon
Forum, a non-profit organisation
which represents a large share
of the hospitality industry, which
provides a platform where members
can join forces to share best practice
and their experiences, which enables
members to make more informed
sustainability decisions.
Net zero carbon
pathway project
Savills UK are our property agents and
they know our pub estate very well.
It made sense for us to partner with
their sustainability specialists Savills
Earth on our net zero pathway project.
Information has been shared by their
teams, which has saved us time and
money. We want to make sure that
we do this properly, and they have the
knowledge and experience to guide
us through the project.
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Decarbonising our
company car fleet
Following on from our 2020
policy to only allow replacement
orders to hybrid and electric cars,
we now have only one petrol
car remaining in our 39 car
fleet. This is due to be replaced
in September 2024 resulting
in 100% removal of petrol and
diesel cars from the business.
38 of 39(97%)
cars in our fleet are
electric and hybrid
(up from 82% 2022)
Our approach to the Task
Force for Climate-Related
Financial Disclosures
(‘TCFD’)
We welcome the introduction of TCFD
and the impetus this will provide
for companies and stakeholders to
understand relevant climate-related
risks and to ensure that appropriate
management processes are in place to
mitigate them. We recognise that in our
FY24 annual report the company will be
reporting against TCFD for the first time.
In order to prepare for the disclosure we
have set up an internal TCFD working
group, and we are in the process of
selecting external advisors to support
and assist us in preparing a roadmap
to compliance.
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Our environment continued
Developing the sustainable Young’s pub
The illustration below provides an overview of the key features that
have been incorporated or are being rolled out to our existing estate
and represent the 2023 edition of the sustainable Young’s pub.
8
4
BEDROOM
9
KITCHEN
2
3
4
PUB
4
1
6
BACK OFFICE
7
CELLAR
1
5
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We have identified four pubs that we will
develop during FY24 to trial the latest
technology, ideas and initiatives which
can then be adopted throughout our
whole estate. We will update you on our
progress each year in this report as our
sustainable pub evolves and the company
embraces new ways of working, new
technology and the latest thinking.
Buildings energy
1
management system (‘BEMS’)
We continue to trial Forest Rock’s
‘MyBuildings.Live’ platform. By testing
energy control methods across various
sites, we can measure the impact and
potential savings, enabling us to reduce
our energy consumption.
Renewable energy
2
From 1 April 2021, 100% of our
electrical supply began to flow from
renewable sources from our group energy
contract, powered entirely by hydro and
wind energy. Our supply is backed by
renewable electricity guarantees of origin
and independently verified by EcoAct,
a Carbon Disclosure Project accredited
provider. In August 2022 the company
entered into a five-year corporate
power purchase agreement with SSE.
This agreement will start in April 2023
and will enable the company to source its
electricity supply from a specific windfarm.
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Recycling and waste
3
We have implemented comprehensive
recycling arrangements throughout our
estate with the aim of diverting as much
waste from landfill as we possibly can.
We work closely with Suez, our waste
management partner, to improve our
recycling rates.
Glass is controlled and sorted by
colour before being crushed, melted,
and moulded into new products.
Mixed recycling is sorted in a materials
recycling facility before being sent for
reprocessing. The food waste collected
from our pubs is sent to anaerobic
digestion plants where it is used to
produce biogas for combined heat and
power units providing renewable power
and heat. What’s leftover in this process
is used as a biofertilizer by farmers.
Our non-recyclable waste is sent to refuse-
derived fuel plants where it is sorted,
shredded and turned into fuel pellets for
use as a fossil fuel substitute in kilns, steel
furnaces and cement and lime plants.
For many years we have been partnering
with Olleco on a successful initiative
to recycle used cooking oil to produce
biodiesel. In total 281,647 litres were
collected during FY23.
LED lighting
4
Since 2018 the company has been
committed to installing LED lamps
throughout its pub estate and new
developments. Year-on-year we continue
to update and install new and replacement
LED lighting where required.
Cellar management
5
We continue to invest and upgrade our
cellars. The company’s cellar energy
management programme incorporates the
installation of ‘Eco Flo’ to beer dispense
units which enables us to control cellar
cooling. The reduced energy consumption
is estimated to save around £194 per
year, per cooler and there are typically two
or three coolers per site.
Waterless urinals
6
We will continue to invest in waterless
urinals which we incorporate into all major
capital expenditure investments. There are
currently 398 waterless urinals across 97
sites. It is estimated that this programme
already provides water savings of over
60.0 million litres per annum.
EV chargers
7
Following on from our initial EV trial at
two of our pubs last year, we are now in
the process of installing 28 EV chargers
across a further ten sites.
Solar panels
8
We have identified a number of our sites
which could benefit from the installation
of solar panels, and we are currently in the
process of scoping a project to install them
in a small number of our sites, so that we
can evaluate the success of the technology
before making any further investments.
Gas conversion project
9
Reducing our consumption of gas is a
key part of our carbon reduction plans.
An electric kitchen suite is due to be
installed in our Food Development
Learning Centre at Copper House in
June and further installations are planned
for FY24.
Our vision is to
have an estate of
sustainable pubs.
281,647
litres
Cooking oil recycled
for biodiesel
(2022: 334,325 litres)
100%
Electricity from renewable
sources through our group
energy contract
(from 1 April 2021)
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Our environment continued
What’s next?
The net zero carbon pathway project
remains at the forefront of our
environmental programme. This year we
aim to plan and phase our investments
and define measurable short, medium
and long-term targets that can be
validated. FY24 is set to be a progressive
year as we implement or progress a
number of key initiatives, including:
Responsible refurbishments
Investing in our estate is a key pillar of
the company’s strategy. During the year
we will be launching and embedding
new development guidance which
will incorporate a minimum level of
sustainability interventions into every
refurbishment. This will involve, amongst
other things, a review of material sourcing,
construction methods and the equipment
and furnishing supply chain. This policy
will evolve over time and the minimum
level of sustainability interventions will rise
as more and more sustainable practices
are incorporated into the company’s
investments as we work to achieve our
net zero targets.
The overnight initiative
Our ‘Save While You Sleep’ initiative
will continue with a target of saving
over 80 tonnes of carbon during FY24,
which currently equates to approximately
£100,000 worth of savings. This initiative
aims to change the behaviour of
operations teams by raising their
awareness of energy savings opportunities,
simply by switching off non-essential
equipment, such as bar fridges, overnight.
We estimate that over time this could
save over 3% of our operational carbon
emissions, as well as helping us to reduce
our energy costs.
Our environmental targets
Short-term targets
Both our operations managers and
general managers will continue to receive
weekly reports to reflect their overnight
usage by site, so they can assess what
pieces of equipment are creating their
highest energy usage and as a result they
can implement small changes to reduce
their consumptions to not only reduce
their carbon emissions, but also reduce
their pub energy costs.
Sustainability champions
During FY23 we designated our
general managers as the sustainability
champion for their individual pubs.
They are centrally supported to work
with their teams to increase the
profile of sustainability, generate and
implement new ideas, and champion
the company’s sustainability initiatives.
Throughout FY24 our operations team,
assisted by the sustainability manager,
will work to increase the level of
engagement providing guidance and
advice, implementing incentives, and of
course creating some friendly competition
amongst our teams. Sustainability is now
fully incorporated into the company’s
general manager induction training and
during FY24 sustainability will be fully
integrated into the company’s career
pathway, ensuring that sustainability
is an integral part of an employee’s
learning journey.
Recycling and waste
In collaboration with our waste
management partners, we have identified
specific areas across the business where
we can improve our recycling rates.
During FY24 we will be launching a
recycling and waste project, which will
focus on the recycling of food waste, with
the aim of driving behavioural change
throughout our estate and significantly
improving our food waste recycling rates.
Sustainable operations
guidance tool
Ensuring that all our pubs have clear
and consistent guidance is an essential
part of driving our sustainability success.
A sustainable operation guidance tool
will be introduced during FY24 and will
be available to all the company’s pubs.
The guidance will initially focus on energy
usage and recycling. It will provide best
practice guidance for everything from
day-to-day standard practices, catering for
seasonal changes and how to deal with
ad-hoc events, thus ensuring that the
most efficient sustainability measures are
considered in every circumstance.
Motion sensors
We are currently scoping a project to
install motion sensors in the back of house
areas of our pubs, where they are not
already installed. The rollout project is due
to start during FY24.
Garden heaters
As far as reasonably practicable all
new heaters installed in our gardens
are electric, and incorporate timers
or movement sensors. We have also
implemented a programme to replace
existing gas garden heaters, where the
electrical load is available.
Medium and long-term targets
2024
Petrol and diesel cars will be
eliminated from the car fleet
by the end of FY24.
2024
We are working towards eliminating
unnecessary single-use plastics from
our front of house operations by the
end of FY24.
2030
2040
The company has aligned itself with the Zero Carbon Forum’s
roadmap for the industry which requires that, as a collective, we are
aiming to achieve net zero1 for our Scope 1 and Scope 2 emissions
(our direct company emissions) by 2030 and net zero1 for our
Scope 32 emissions (our supply chain emissions) by 2040.
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1 For the company, net zero means the intention to reduce our Scope 1 and 2 emissions by
up to 90% by 2030, and our Scope 3 emissions by between 50 – 70% by 2040.
2 Please see our Scope 3 disclosure on page 42.
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Sustainable Restaurant Association
3 Star Food Made Good Rating
The Sustainable Restaurant Association’s
(the ‘SRA’s’) purpose is to accelerate
change towards an environmentally
restorative and socially progressive
hospitality sector. Their ‘Food Made
Good’ rating standard is the most
globally recognised industry standard
for measuring sustainability across the
hospitality sector. During the period the
company’s rating was reassessed by the
SRA, and we are delighted to report
that we maintained our three-star rating,
which is the highest rating that the SRA
awards. The company proudly showcases
the best of British produce, with most
of our ingredients sourced within a
75-mile radius of London. Even though
we have maintained our rating we are
committed to continually improving our
sustainability practices.
As a business
we are evolving
to reduce our
footprint.
Produce and supply chain transparency
We offer best-in-class seasonal British
food and drink. Our menus are crafted
using the finest ingredients, the majority
of which are sourced in the UK. We are
passionate about seasonal food and we
change our menus quarterly so that they
include the latest seasonal ingredients.
Improving the transparency of our supply
chain and the traceability of the products
we buy is a key focus for the company.
Throughout the next year we will be
meeting with our key suppliers, as well
as hosting our own supplier event to
communicate our sustainability
vision and discuss how we can work
together to reduce our supply chain
emissions. We have also joined Sedex,
a leading ethical trade organisation
working towards improving supply
chains, through supplier mapping and the
analysis of business risk. We will be using
the Sedex platform as a tool to assess
our key suppliers ESG practices. We will
continue to work in partnership with our
suppliers in order to achieve our target
of a carbon neutral food supply chain
by 2040.
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Our environment continued
Greenhouse gas emissions, energy consumption and energy efficiency action
Revenue in £ million
No. of managed houses at the year-end
The annual quantity of emissions in tCO2e resulting from activities for which the group
was responsible involving (i) the combustion of gas or (ii) the consumption of fuel for the
purposes of transport
The annual quantity of emissions in tCO2e resulting from the purchase of electricity by
the group for its own use, including for the purposes of transport
The annual quantity of energy consumed in kWh from activities for which the group
was responsible involving (i) the combustion of gas or (ii) the consumption of fuel for
the purposes of transport, together with the annual quantity of energy consumed in
kWh resulting from the purchase of electricity by the group for its own use, including
for the purposes of transport
Total Gross Emissions (tCO2e)
The group’s annual emissions: ratio of tCO2e (gross) per £ million of revenue
Carbon offsets procured via Green Electricity Tariff
Total Net Emissions (tCO2e)
2023
368.9
227
2022
309.0
219
Base year
311.6
207
9,163
8,430
8,247
7,316
8,234
8,727
78,800,459
80,403,035
78,613,804
16,479
44.67:1
(6,525)
9,954
16,664
53.93:1
(7,946)
8,718
16,974
54.47:1
–
16,974
54.47:1
The group’s annual emissions: ratio of tCO2e (net) per £ million of revenue
26.98:1
28.21:1
In line with requirements, we have elected
FY20 as our base year for our Scope 1
and 2 reporting, being the earliest year we
have complete data for.
We have seen a portfolio increase of
13.5% vs the base year, with the addition
of 20 new sites since then. There are
many steps being taken to mitigate our
emissions such as the removal of all gas
patio heaters from our gardens and where
heaters are still required, installing electric
ones. This has seen propane deliveries
reduced to 0 across 43 sites. Scope 2
emissions have continued to decline,
helped by the grid’s decarbonisation
overall. Additionally, we have rolled out
energy savings initiatives, such as the ‘Save
While You Sleep’ initiative, which has seen
an overall emission saving of 8 tCO2e
throughout the year. Overall emissions
have continued to decline year on year,
which coupled with the increase in annual
revenue has a 22.0% energy intensity
reduction (ratio of tCO2e per £ million
of revenue).
The following methodologies were used to
calculate the above quantities:
• the kWh consumption figures relevant
to gas, electricity, district heating
(i.e. a system for distributing heat
generated in a centralised location
through a system of insulated pipes
for residential and commercial heating
requirements such as space heating
and water heating) and district cooling
(i.e. a system working on broadly
similar principles to district heating but
delivering chilled water to buildings
needing cooling) were taken from
invoices received by the group1 – the
kWh figures were then converted to
tCO2e figures using the then current
conversion factors published by DEFRA;
• the consumption figures relevant to
propane were taken from invoices
received by the group1 – these were
either in kilograms or litres delivered
and were then converted to kWh
and tCO2e using the then current
conversion factors published by
DEFRA; and
• the consumption figures relevant
to transport were calculated using
expensed mileage figures – to calculate
tCO2e for company cars, the group
then used the car manufacturer’s
gCO2/km data and increased this by
38% per guidelines issued by DEFRA
– to calculate tCO2e for mileage
completed in other cars, the conversion
was made using figures for an average
car per guidance issued by DEFRA
– in each case, the resulting tCO2e
figures were then converted to kWh
using the then current fuel conversion
1 Where data was missing, values were estimated using an extrapolation of available data.
factors published by DEFRA – where
the fuel type used was unknown, it
was assumed to be diesel in line with
guidance published by DEFRA.
Our Scope 3 emissions
The company has aligned itself with the
Zero Carbon Forum’s roadmap for the
industry. We are aiming to achieve net
zero for our Scope 3 emissions and we
will work with external advisors to develop
our Scope 3 project plan.
We commissioned Zero Carbon
Services during the period to assist us
in determining our Scope 3 emissions
baseline as FY2022, which revealed that
these emissions represent just over 80%
of our total emissions. This equates to
emissions of 72,206 tCO2e, which sits
slightly below the average for our sector
based on the Zero Carbon Forum’s
roadmap. We estimate that 60% of our
Scope 3 emissions come from food and
beverage, which is the main revenue
stream for the business, of which 41% is
related directly to food.
A key focus of our sustainability strategy
during FY24 will be to gain a better
understanding of our supplier base, and
for our key suppliers to gain a better
understanding of our expectations, so
that we can work together to reduce
our emissions.
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Sustainability report
UN Sustainable Development Goals
The 17 UN Sustainable Development Goals (‘SDG’s’) are a call to action by countries across the globe to promote people’s health
and prosperity, while also protecting the planet. We are committed to ensuring that our responsible business strategy contributes
towards the SDG’s to tackle societal problems, along with the challenges that need to be met if the worst consequences of climate
change are to be avoided.
We have aligned ourselves with five of the SDG’s and have included some examples and how we support them below:
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Our people
Our communities
Our environment
Our focus
• We focus on the wellbeing of our
colleagues with comprehensive
financial and mental health support.
• We play a positive role in our
communities and give back
where possible.
• We engage and empower our teams
with regular communication and
commitment to their career pathway.
• We celebrate the best of British and
champion local suppliers throughout
our menus.
• We foster diversity and inclusion
• We do our utmost to support
through our approach to
appointments and training.
our suppliers and be fair
commercial partners.
• We aim to reduce, reuse and recycle
our waste in the most sustainable
way possible.
• We implement new emissions saving
technologies across our estate.
• We work closely throughout
our supply chain to improve the
environmental impact of our produce,
from farm to fork.
The Ram Agency was developed to
support flexible working where workers
can pick and choose their own shifts
helping to support their work-life
balance.
Built an in-house team of mental
health first aiders and mental health
first aid champions who support their
colleagues across the business.
Our achievements and goals
With the continued growth of the
Young’s estate we are increasingly
growing our teams, employing a diverse
and inclusive workforce.
Providing education and awareness
on climate related issues and offering
guidance on how employees can reduce
their footprint both at work and at home.
Giving in October – supporting
local charities through fundraising,
volunteering and hosting various
charity events. Buying locally from our
community of local British producers to
reduce our carbon footprint.
Increase our use of renewable energy
sources by switching to a renewable
energy contract for our electricity usage.
Converting our gas kitchen equipment
to electric as part of our gas conversion
project.
Working in partnership with the
Licensed Trade Charity to offer
employees emotional support, specialist
guidance and financial grants.
Partnering with the Wooden Spoon
charity, supporting life changing projects
and providing grants for children and
young adults across the UK and Ireland.
Working in conjunction with the
Zero Carbon Forum and its members
to reduce our carbon footprint and
meet our sustainability targets.
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Principal risks and uncertainties
The principal risks and uncertainties facing the group are listed below. It is not
an exhaustive list of all significant risks and uncertainties; some may currently be
unknown and others currently regarded as immaterial could turn out to be material.
Further information on the group’s financial risk management objectives and policies are set out in note 25 starting on page 129.
Major external event
leading to widespread pub
closures and/or a huge
decline in demand
Risk 1.
Example:
The spread of a disease – recent
experience has shown the potential for
something like this to have far-reaching
and unexpected consequences for our
business. As the coronavirus pandemic
has spread around the globe in the last
two years, some of these consequences
became apparent and resulted in a very
material and unforeseeable impact on
our business.
Potential impact
This will depend on the nature of
the event, its impact and reach and
the reaction to it by the government,
consumers, business and others.
Mitigation
This will depend on the nature of
the event, its impact and reach and
the reaction to it by the government,
consumers, business and others.
Our strong balance sheet and excellent
teams enable our strategy of operating a
diverse, premium, well-invested pub estate
and allow us to rise to challenges thrown
our way. The recent covid pandemic has
given us the experience to ensure we
are better placed to combat any future
major event resulting in widespread
pub closures.
Climate change and
sustainability
Consumer-related
Risk 2.
Risk 3.
Example:
Extreme weather, climate action failure
and human-led environmental damage
continue to top the list of the world’s
highest risks with regulations, government
interventions and enhanced emissions
reporting obligations expected to continue
to increase. The group’s customers,
employees and investors are increasingly
demanding reassurance that we are
managing the climate change risk across
our business activities.
Potential impact
The increased occurrence of extreme
weather events, regulations, government
interventions, reporting obligations and
our inability to meet climate change
targets could reduce revenues and profits.
Failure to address these risks could
impact trust and reputation amongst
customers, employees, investors and
other stakeholders.
Mitigation
We are developing a comprehensive
sustainability strategy and have aligned
ourselves with the Zero Carbon Forum’s
roadmap for the industry which requires
that, as a collective, we are committed to
achieving net zero by 2030 for Scope 1
and 2 emissions and by 2040 for Scope
3 emissions. Sustainability initiatives
have been launched to reduce the
group’s energy usage and embed
sustainable business practices throughout
the business.
We are working with external ESG
advisors to develop our pathway to net
zero which will enable us to phase the
required investment and identify short,
medium and long-term measurable
targets, so that our stakeholders can
monitor progress. See our sustainability
report on pages 24 to 43.
Example:
Our revenue is largely dependent on
consumer spending within our managed
estate. A consumer’s decision to spend
their money can be affected by a broad
range of matters (including those set out
in risk 1, confidence in the UK economy,
the weather, fears of terrorist activity and
greater awareness of the potential adverse
health consequences associated with
alcohol) set against a choice of where
to go and what to do.
Potential impact
A reduction in our revenue
could result in lower profits.
Mitigation
Our pubs are mainly spread throughout
London and Southern England, with the
majority inside the M25. Through them,
we provide a hospitable and welcoming
home from home, often at the heart of
the local community. They benefit from
customer-focussed designs, high service
standards, quality food (including vegan
and vegetarian options) and market-
leading drinks (including non-alcoholic
options), all of which matter to the
discerning consumer. By having a mix
of excellent riverside, garden and city
pubs, we seek to address the impact of
seasonality and changes in consumers’
spending habits.
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Key to change in the risk/uncertainty level from the prior period
Decrease
No change
Increase
Risk 5.
Risk 6.
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Example:
The pub industry is subject to a variety of taxes,
including business taxes, duty on alcoholic
drinks and business rates.
Financial
Risk 4.
Example:
Various factors, including legislation, conflict,
pandemics and global demand, may result
in the amount we pay for our key supplies
(including food, drink, gas and electricity) and
labour being increased. An example would
be the National Living Wage, where the
hourly rate was increased by 9.7% to £10.42
(from £9.50) with effect from 1 April 2023
(for those aged 23 and over). Increased costs
could potentially make our offer less
attractive to consumers if they are passed on.
Potential impact
A reduction in our revenue and/or an
increase in our costs will have an impact on
our margins and could result in lower profits.
Potential impact
The introduction of new taxes and/or increases
in the rates of existing taxes could result in
lower profits.
Mitigation
As regards rates, we retain the services
of specialist rating consultants who
review each and every rating assessment.
Appeals are lodged on our behalf where the
new assessments are deemed excessive.
Mitigation
Fixed-price arrangements are in place with
some of our food and drink suppliers.
Regarding utilities, we continually look at
ways of reducing our levels of consumption;
we also regularly review our energy needs
and price changes in the market, and, where
appropriate, we make forward purchases.
Increased wages may result in consumers
having greater capacity to absorb increased
prices, but any shortfall will need to be
mitigated through greater labour and other
efficiency gains.
Example:
We operate a defined benefit pension
scheme that has to be funded to meet
agreed benefit payments. The value of the
scheme can be impacted by a variety of
factors, including changes in life expectancy
assumptions, lower than anticipated
performances of the stock market and
reduced bond yields. We also operate two
defined contribution pension schemes that
require minimum levels of contribution from
the company set by the government.
Potential impact
Variations in the difference in value between
the assets of the defined benefit scheme and
its liabilities may increase the amount we are
required to pay into it in order to account
for past service benefit deficits and future
service benefit accruals. An increase in our
contribution levels to the defined contribution
schemes could result in lower profits.
Mitigation
The defined benefit scheme was closed
to new entrants in 2003 and we make
additional contributions over and above
regular service contributions to help address
any funding deficit. We also maintain a
close dialogue with the scheme’s trustee.
To limit further the potential exposure, future
service benefits accruing to remaining active
members were reduced from April 2016,
with member contributions being increased
in tandem.
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Principal risks and uncertainties continued
Financial continued
Operations
Operations continued
Risk 7.
Risk 8.
Risk 9.
Example:
Our financial structure involves bank
borrowings and senior secured notes due
2039. The business therefore needs to
generate sufficient cash to repay these
debts with accrued interest. Interest rates
are also subject to change. See also 12.
Example:
We rely on a number of key suppliers to
provide our pubs with food and drink.
Example:
We are reliant on information systems and
technology for many aspects of our business,
including communication, sales transaction
recording, stock management, purchasing,
accounting and reporting and many of our
internal controls. Information systems can be
at risk of failure due to technical issues and the
threat of cyber-attack.
Risk 10.
Example:
Risk 11.
Example:
We are dependent on having the right people
Part of our growth plan is based on
throughout our organisation: at all our pubs
acquiring and/or developing additional
and at Copper House.
pubs/bedrooms.
Potential impact
Our ability to trade as a going concern
depends on us generating sufficient cash
to meet these repayments.
Potential impact
Supply disruption could affect customer
satisfaction, leading to a reduction in our
revenue which could result in lower profits
and growth rates.
Potential impact
Any failure of such systems or technology
would cause some disruption, and any
extended period of downtime, loss of backed
up information or delay in recovering
information could impact significantly on our
ability to conduct business.
Potential impact
Potential impact
Our ability to achieve our strategic and
If acquisitions do not take place and/or
operational objectives could be affected if we
developments do not occur when planned,
are unable to attract and retain the right people
or at all, our desired future growth rate could
with the desired skillsets.
be delayed or reduced.
Mitigation
The vast majority of the group’s debt
profile is long-dated, facilities are
committed and debt is carefully managed
within financial covenants. A mix of debt
at fixed and variable interest rates is also
maintained, with interest rate swaps used
to assist in managing this exposure.
Mitigation
Food and drink is sourced from a number
of suppliers. Informal arrangements are
also in place such that substitute suppliers
or products could be used if required.
Our offering provides an attractive showcase
for food and drink suppliers - we therefore
anticipate that new suppliers would be ready
and willing to come on board relatively
quickly should there be limited disruption
of our food and drink supply chain.
We regularly review our choice of suppliers.
Mitigation
Firewalls and anti-virus software are installed to
protect our networks. Information is routinely
backed up and arrangements are in place
with a third party provider to assist with data
recovery. There is a full business continuity plan
in place, enabling full remote working should
any major incident occur at Copper House.
The IT needs of the business are regularly
monitored and we invest in new technology
and services as necessary.
Mitigation
Mitigation
We look to recruit and retain the best talent.
We have relationships with a variety of third
The remuneration and reward packages we
parties to ensure, as far as possible, that we
offer are competitive and designed to retain
are made aware of acquisition opportunities
and motivate staff. We have training and
as and when they come up. We have
development programmes in place so that
provided a number of agents and landlords
our people have the right skills to perform
with details of our preferred site profiles.
their jobs successfully and achieve their full
potential. We have established a close working
relationship with Performance Learning Group
an apprenticeship provider, who develop
programmes that dovetail into our own
career pathway.
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Operations
Risk 8.
Example:
We rely on a number of key suppliers to
We are reliant on information systems and
provide our pubs with food and drink.
technology for many aspects of our business,
Risk 9.
Example:
including communication, sales transaction
recording, stock management, purchasing,
accounting and reporting and many of our
internal controls. Information systems can be
at risk of failure due to technical issues and the
threat of cyber-attack.
Key to change in the risk/uncertainty level from the prior period
Decrease
No change
Increase
Operations continued
Risk 10.
Risk 11.
Regulation
Risk 12.
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Example:
We are dependent on having the right people
throughout our organisation: at all our pubs
and at Copper House.
Example:
Part of our growth plan is based on
acquiring and/or developing additional
pubs/bedrooms.
Example:
We are required to meet a range of
ever-increasing compliance, regulatory
and health and safety obligations in the
operation of our business.
Potential impact
Potential impact
Supply disruption could affect customer
Any failure of such systems or technology
satisfaction, leading to a reduction in our
would cause some disruption, and any
revenue which could result in lower profits
extended period of downtime, loss of backed
and growth rates.
up information or delay in recovering
information could impact significantly on our
ability to conduct business.
Potential impact
Our ability to achieve our strategic and
operational objectives could be affected if we
are unable to attract and retain the right people
with the desired skillsets.
Potential impact
If acquisitions do not take place and/or
developments do not occur when planned,
or at all, our desired future growth rate could
be delayed or reduced.
Mitigation
Mitigation
Food and drink is sourced from a number
Firewalls and anti-virus software are installed to
of suppliers. Informal arrangements are
protect our networks. Information is routinely
also in place such that substitute suppliers
backed up and arrangements are in place
or products could be used if required.
with a third party provider to assist with data
Our offering provides an attractive showcase
recovery. There is a full business continuity plan
for food and drink suppliers - we therefore
in place, enabling full remote working should
anticipate that new suppliers would be ready
any major incident occur at Copper House.
and willing to come on board relatively
The IT needs of the business are regularly
quickly should there be limited disruption
monitored and we invest in new technology
of our food and drink supply chain.
and services as necessary.
We regularly review our choice of suppliers.
Mitigation
We have relationships with a variety of third
parties to ensure, as far as possible, that we
are made aware of acquisition opportunities
as and when they come up. We have
provided a number of agents and landlords
with details of our preferred site profiles.
Mitigation
We look to recruit and retain the best talent.
The remuneration and reward packages we
offer are competitive and designed to retain
and motivate staff. We have training and
development programmes in place so that
our people have the right skills to perform
their jobs successfully and achieve their full
potential. We have established a close working
relationship with Performance Learning Group
an apprenticeship provider, who develop
programmes that dovetail into our own
career pathway.
Potential impact
A failure to comply with these obligations
could damage our reputation, see us
being fined, and as regards health and
safety, result in an accident or incident
occurring involving injury, illness or even
loss of life. All of these could possibly lead
to a reduction in our revenue and lower
growth rates. Increases in the cost of
compliance could have an impact on our
margins and result in lower profits.
Mitigation
We carefully monitor legislative
developments, and our training
programmes, policies, processes and
audits are designed to promote and
achieve compliance with our obligations.
Health and safety audits are undertaken
by a third party who also works with us
to ensure changes in health and safety
practices and procedures are incorporated
into our business and reviewed on a
regular basis. Insurance cover to help with
any financial compensation that may be
payable because of an accident or incident
has been taken out.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
47
Strategic Report
Young’s pubs with rooms
Our Young’s Rooms celebrate all there is
to enjoy about the unique experience of
staying in pubs.
You feel the charm of the building and
the buzz of the banter the moment you
step in.
Full to the brim with character, a bar on
hand and a great kitchen too. And just a
few steps takes you to a super-comfy bed.
Every room is a discovery, and every stay
is extraordinary.
Our bedrooms are truly as exceptional as
each of our wonderful pubs. It really is a
joy to stay in a Young’s pub.
Bedrooms as
lovably unique
as our pubs.
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Business and financial review
£368.0m
Managed revenue
(2022: £307.7m)
£73.3m
Managed adjusted
operating profit
(2022: £72.1m)
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Our ‘Summer Infusion’ campaign
generated great interest and delivered
volume growth across our spirit and
alcohol-free categories. Premium spirits
were paired with high-quality mixers
and elevated garnishes, giving our
customers an alternative to a regular
spirit serve. Ahead of Christmas, to
capitalise on the continued growing
market trend of cocktails, we relaunched
our Cocktail Collective, an innovative
new menu including the very popular
‘Gingerbread Martini’, winner of our
cocktail competition.
We continue to review our wine lists
regularly, introducing new and interesting
wines each year, offering greater premium
options for those customers who wish
to trade up. In April, we introduced
Nyetimber, widely regarded as England’s
finest sparkling wine, replacing our grand
marque Champagne, helping drive
9.0% growth in the premium sparkling
category. Elsewhere we extended our
range of rosé wine, giving customers
increased choice and the premium option,
capitalising on its ‘gin-like’ renaissance,
with sales up this year by more than 20%.
We continue to embrace some
of the behavioural changes that
were accelerated by the pandemic.
Technology is an important part of this,
as it helps to drive bookings and planned
events. The Young’s On Tap app still
plays a key role in our pub gardens, and
we see this as an important tool to help
manage payroll costs and drive top-line
growth. To constantly improve the quality
of our database and connect better with
our customers, we need to increase the
number of channels through which we
communicate with them. This will allow us
to tailor and target our communications
more effectively, using both traditional and
social media channels.
The return to a normal pub environment
has also given us the opportunity to
drive our core business, with drink sales
ahead of last period by 21.5%, and up
by 17.0% on a like-for-like basis over
52 weeks. In April we launched our new
draught beer and cider range bringing
fresh and exciting products to our bars
through several strategic partnerships.
We had huge success evolving the range
with Pravha, our new entry level lager,
as well as adding Beavertown Young
Sun, Brooklyn Pilsner and most recently
Asahi Super Dry, to ensure our bars
remain relevant and offer choice to our
customers while maintaining our drive for
premiumisation. Meanwhile, popularity
and success among our established
brands continues to grow, with Guinness
volume up 30.9%, now very much seen
as a drink for all seasons, having risen
into the list of our top three best sellers.
Managed houses
This year has been a historic one, with
many notable events that have shaped our
nation. Over two additional bank holidays,
customers gathered in our pubs to raise
a glass and celebrate the Queen’s Jubilee.
A few months later, they joined together
to pay their respects on the day of the
Queen’s funeral. Our pubs play a pivotal
role in their communities, providing a
unique and welcoming environment,
helping to bring people together in all
kinds of circumstances.
Total managed house revenue was up
19.6% for the 53 weeks to £368.0 million
(2022: 307.7 million), and up 12.9% on
a like-for-like basis over 52 weeks (VAT
adjusted like-for-like sales up 17.6%
on 52-week basis). Trading initially
peaked during the summer months as
our exceptional gardens and outdoor
spaces helped us capitalise on the
prolonged periods of hot weather when
temperatures reached record levels.
Later in the year, the build-up to the
festive period was supported by the first
winter FIFA World Cup. This provided
additional opportunities for external
areas to boost revenues, as customers
gathered to support the home nations.
The negative effect from rail strikes in the
Christmas period did not stand in our
way of achieving record festive bookings,
which were also significantly ahead of the
same period in 2019. Unfortunately, the
industrial action wasn’t only focused on
December, with the estimated £3.7 million
impact on revenue felt throughout the
past year.
Overall, the return to normal trading has
been extremely positive for our business.
Central London and City areas continue
to bounce back as workers and tourists
return to the capital. While working
patterns have changed, with fewer people
commuting into the office full-time, the
condensed working week has resulted in
increased sales for our pubs in the capital
across Tuesday to Thursday.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
49
Strategic Report
Business and financial review continued
During the year we hosted a
collection of ‘Food for Thought’
dinners, showcasing the best of
underutilised British produce
such as unfamiliar species and
foraged ingredients.
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In recent years, there has been a growing
trend of people abstaining from alcohol,
not just in January. In fact, one in three
visits to the pub now involves no alcohol.
This trend is driven by several factors,
including people wanting to moderate
their alcohol intake. To help meet this
trend we have been launching new and
exciting drinks in our Lo/No category.
Last year we launched our first alcohol-
free draught lager, Estrella Free Damm.
We also moved most of our mixers to
low-sugar options and created several
alcohol-free cocktails. While the category
still represents a very small proportion of
our sales, we are committed to meeting
the needs of our customers who are
looking for healthier and more mindful
drinking options.
Food sales continue to be an important
part of our business, and as a mix of sales
have increased to 33% compared to
pre-pandemic (2019: 30%), as the pub
environment evolves into an all-round
destination. Encouragingly, total food
sales grew by 9.1% (53 weeks) against
the tough prior year comparatives due
to the lower VAT rate, and were up by
1.7% on a like-for-like 52-week basis (VAT
adjusted like-for-like sales up 12.2% on
52-week basis).
One of the key successes to maintaining
the high standards of our food offer
has been ensuring that our classics
remain classic. To help maintain that
consistency we launched the ‘Young’s
Digital Recipe Book’, a tool to showcase
premium quality and inspire our teams,
highlighting the best-in-class produce
available. Updated every quarter, it
contains more than 150 recipes aimed
at helping with the challenges posed by
rising food inflation and seasonality to
achieve stronger margins. The quarterly
chef forums, held in our new training
and development kitchen, located at
Copper House (Wandsworth), allow us to
engage with all head chefs from across
the business and provide an important
opportunity to communicate our premium
food vision.
At Young’s we also take great pride in
our food, offering distinctive dishes and
unique food-led experiences that capture
the customers’ imagination. During the
year we hosted a collection of ‘Food
for Thought’ dinners, showcasing the
best of underutilised British produce
such as unfamiliar species and foraged
ingredients. The Oyster Shed (Bank) was
recognised with its first AA rosette for
culinary excellence, and its head chef,
Natalie Coleman, picked up the award for
‘Pub chef of the year’ at the Great British
Pub Awards.
Total accommodation revenue was up
78.0% for the 53-week period, in part
reflecting the slower opening up of
the hotel market in the prior year, as
well as the growth in our number of
bedrooms through recent investment
and acquisitions. On a like-for-like basis
over 52 weeks, accommodation revenue
was up by 46.1%, despite the prior
period benefitting from reduced VAT
rates. While our like-for-like occupancy
increased to 72.0% (2022: 60.1%), the
growth in average room rates to £105.95
(2022: £98.65) demonstrated a demand
for our premium room offer and the
positives of returning business travel,
particularly in our London pubs with
rooms. Resulting like-for-like RevPAR was
£76.29 compared with £59.25 last year.
Like so many businesses, the high
inflationary environment has negatively
impacted operating margins this period,
though we have worked hard to mitigate
this. While our drink costs are largely
fixed, based on contractual agreements,
food prices fluctuate from month to
month and our executive chefs work
tirelessly with their pubs to combat the
sharpest rises in food costs. The central
consolidation of food suppliers we
undertook earlier this year, into a one-stop
shop model, has helped alleviate cost
increases and reduce our carbon footprint.
Recruitment remains a challenge for
the whole industry, compounded by
significant wage inflation driven by some
of the highest increases to the National
Living Wage since its introduction.
Investment in our people has never
been so important. Through training and
development and access to the Young’s
career pathway, we are able to provide
our teams with the necessary skills to help
them reach their career goals. The Ram
Agency, now with more than 350 active
employees, plays an important role,
firstly by giving team members added
flexibility to choose shifts that suit their
requirements, but also helping us manage
our cost base, reducing the reliance on
agency staff. The in-house agency brings
together people with the necessary skills
across a range of roles, from general
managers to chefs, front and back of
house team members, trained in the
Young’s way of working.
The energy crisis has affected almost
all businesses and although we have
fixed our utility rates until March 2024,
the big rises in energy costs meant that
we still spent an additional £5.5 million
in the year, an increase of 82% on last
year. The cost headwinds we faced this
period have been compounded by
government support in the prior year,
where in addition to the lower VAT
rate (£12.3 million), we benefitted from
business rates relief, which resulted in
an additional cost of £6.0 million this
period. Despite these headwinds, total
managed house adjusted operating
profit was up 1.7% to £73.3 million
(2022: £72.1 million).
£34.4m
Managed pub investment
(2022: £24.7m)
£71.40
RevPAR
(2022: £55.50)
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
51
Strategic Report
Business and financial review continued
1.9 times
Net debt to adjusted EBITDA
(2022: 2.1 times)
£842.5m
Our estate value
(2022: £808.0m)
Investment
During the year, we spent £34.4 million
on our existing estate to ensure that our
pubs remain premium, individual and
well-invested. The focus on restoring our
pubs has seen us complete investments in
a total of 34 pubs, with standout schemes
at the Crown (Bow), Coborn (Mile End),
Crown (Lee), Bull (Streatham), Brook
Green and Hammersmith Ram (both in
Hammersmith), Halfway House (Earlsfield)
and the East Hill (Wandsworth).
The final quarter of the year was a key
period of investment, we were onsite
with six major projects, where exciting
schemes looked to capitalise on previously
underutilised space within pubs to
provide fantastic growth potential for
the upcoming years. In Bristol, having
been closed for most of the year, the
upper parts of Hort’s Townhouse were
transformed to create a stunning 19
bedroom ‘pub with rooms’. At the Hare
& Hounds (East Sheen), extensive work
to the large garden has created more
than 200 covers in the various huts and
pergolas. Finally, in Central London, we
are currently onsite at the Marquess of
Anglesey (Covent Garden), where the
full repositioning will include a stunning
new roof terrace, allowing customers
the opportunity to escape the densely
populated streets below. This project is
due to complete and reopen next month
in time for peak summer trade.
On the acquisition front, we added six
new pubs in the period. All our new
additions are individual and unique
businesses located in affluent commuter
towns that present Young’s with the
opportunity to gain a foothold in a
previously unrepresented geography.
In total we added 40 bedrooms, with 18
bedrooms at the characterful Bedford
Arms (Chenies), 9 bedrooms at the
Carpenter’s Arms (Tonbridge) and 13
bedrooms at the Griffin Inn (Fletching)
in East Sussex. After acquiring both
the Merlin’s Cave (Chalfont St Giles)
and the Half Moon (Windlesham) we
went onsite to complete investment
schemes to take these pubs to the next
level. Their locations in picturesque
village settings make these businesses
perfect Young’s pubs and they will both
play an important part in our future.
Our acquisition of the Wild Duck (near
Cirencester), adds further to the future
growth pipeline. In recent years, this
impressive site has been closed as part of
a monumental back-to-brick renovation,
and following our extensive investment,
will reopen as another premium
Young’s pub with rooms in the heart of
the Cotswolds.
During the period we transferred two
of the remaining tenanted pubs to our
managed estate. In the heart of the
City, we invested and opened Bishop’s
Vaults (Bishopsgate) with a premium
wine bar located in the vaults. In March,
we took back the Clapham North
(Clapham), which immediately closed
and will reopen later this summer after a
major investment.
Following the disposal of the Bridge Hotel
(Greenford) in March 2023, we finished
the period with a total of 227 pubs
(2022: 222), including 39 pubs providing
a total of 793 bedrooms.
Other key areas
Property
Our balance sheet strength is
underpinned by our predominantly
freehold estate in many highly desirable
locations. 187 of our 227 pubs are
freehold or are long leaseholds with
peppercorn rents. Our total estate,
including freehold and fixtures and
fittings on leaseholds, is now valued at
£842.5 million (2022: £808.0 million).
The carrying value of property leases,
including long leaseholds, is separately
recognised as right-of-use assets in
note 20. We have continued to add
52
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
value through major developments to
improve our existing pubs and strategic
acquisitions, primarily focussing on
freehold assets.
Each year we revalue our pub estate to
reflect current market values. Savills, an
independent and leading commercial
property adviser, has revalued all our
freehold properties. The valuation method
used several inputs and the sustainable
level of trade of each pub remained key.
In accordance with International Financial
Reporting Standards, individual increases
in value have been reflected in the
revaluation reserve on the balance sheet
(except to the extent that they had
previously been revalued downwards) and
individual falls in value below depreciated
cost have been accounted for through
the income statement. None of these
adjustments have a cash impact.
Despite our return to profitable trade,
the impact of the last few years has
been considerable for individual pubs
as they continue to build back to pre-
pandemic levels. Pub property market
sentiment has remained positive, reflected
by the level of activity and property
prices; as a result, we have seen a
net upward revaluation movement of
£8.2 million. This is comprised of an
upward movement of £15.2 million
(2022: £28.7 million upward movement)
reflected in the revaluation reserve and
a downward movement of £7.0 million
(2022: £0.8 million upward movement)
recognised as an adjusting item in the
income statement.
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During the year, we spent £34.4
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ensure that our pubs remain premium,
individual and well-invested.
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Strategic Report
Business and financial review continued
Treasury and going concern
At 3 April 2023, the group had cash in
bank of £10.7 million and committed
borrowing facilities of £205.0 million
having elected not to renew the
£30.0 million facility with NatWest in
March 2023 given the current headroom.
The £105.0 million of drawn facilities
are all fully interest rate hedged, and
in addition to these we maintain a
£10.0 million overdraft with HSBC.
We are highly cash generative and
despite another year of significant
investment, our net debt including lease
liabilities has fallen to £165.2 million
(2022: £173.8 million), with net debt to
adjusted EBITDA ratio conservative at 1.9
times (2022: 2.1 times).
Whilst our pubs continue to trade
extremely well, it remains prudent to
recognise a small degree of uncertainty
ahead due to any potential slowdown in
consumer spending influenced by the
ongoing cost of living increases and to
acknowledge the impact of the current
cost inflation that could influence future
profitability. As part of the directors’
consideration of the appropriateness of
adopting the going concern basis, the
group has modelled several scenarios for
the going concern period, ending 1 July
2024. The base case model assumes we
continue to trade as now whilst reflecting
the inflationary environment that currently
exists, with trade continuing to build
in line with Young’s growth strategy.
The general reduction in trade scenario
looks at a decline of 20% in sales and
25% in profit across the period. This aims
to capture the potential slowdown in
consumer spending influenced by the
ongoing cost of living crisis. The cost
inflation scenario includes an average
8% increase in the food cost base and
10% increase in general pub operating
costs for the period with no retail price
increases. Utility pricing has been held at
the base case rates given the group has
forward bought utilities to March 2024.
We have assumed capital expenditure
levels will continue at historical levels and
no structural changes to the business
will be needed in any of the scenarios
modelled. The reverse stress test indicated
there would need to be a sales reduction
of c.40% and profit reduction of c.60%
between April 2023 and June 2024
compared to the base case before there
is a breach of financial covenants in
the period. This was calculated before
reflecting any reduced head office costs
or bonuses, reduced capital expenditure
or suspension of dividends. The Directors
believe the scenario to be remote.
The impact of climate change on going
concern has been considered and
determined that there is no impact on the
business during the going concern period.
Aligned with the group’s developing
ESG strategy this will continue to feature
in future assessments, as the group
determines the potential wider impact on
the asset base, capital expenditure and
cost of compliance.
While the group expects to have available
facilities of £205.0 million during the
going concern period, the plan to
renegotiate the £20.0 million term loan,
due May 2024, falls within this period.
However, given that those negotiations
have yet to take place, for going concern
purposes, the group has assumed that
available facilities will be £185.0 million
at the end of the going concern period.
Further details are set out in note 1 of the
attached financial statements.
Based on these forecasts and sensitivities,
coupled with the current debt levels
and the revised debt structure, the
board is confident that the group is
able to manage its business risks and
to continue in operational existence.
Accordingly, the board continues to adopt
the going concern basis in preparing
the consolidated financial statements.
Further details are set out in note 1 of the
attached financial statements.
Retirement benefits
We have a defined benefit pension
scheme which has been closed to new
entrants since 2003. During the year our
pension scheme surplus has decreased
by £8.5 million to £3.7 million, driven by
a decrease in the return on the scheme’s
assets and an increase in the discount
rate applied. We have continued our
commitment with another year of special
contributions, totalling £1.2 million, and
remain fully committed to ensuring the
pension scheme is adequately funded.
Adjusting items
Total adjusting items were £9.0 million in
the period (2022: credit of £0.3 million),
and as previously mentioned, the majority
relates to the net downward movement
in property revaluation for the period of
£7.0 million. Purchase costs relating to
the six acquisitions were £1.1 million and
there was an additional £0.6 million of
tenant compensation for Bishop’s Vaults
(Bishopsgate) and an unlicensed property
(Ealing). The remaining £0.3 million
relates to restructuring costs following
a reorganisation at Copper House, our
corporate head office.
Tax
A tax charge of £6.5 million
(2022: £17.5 million charge) was
recognised for the year. The effective
tax rate was 18.0% (2022: 33.7%)
compared to the statutory rate of 19.0%
with the difference primarily driven by the
re-measurement of deferred tax assets
as a result of the increase in the future
substantively enacted tax rates from
19.0% to 25.0%. Further detail can be
found in note 14.
Shareholder returns
Having started life in 1831, Young’s is
a long-standing business, and we are
determined to maintain our long-term,
sustainable growth story.
Our top-line trading performance has
flowed through to strong profit conversion
and cash generation. Our adjusted
earnings per share was at 64.29 pence
(2022: 56.26 pence). On an unadjusted
basis, the earnings per share was 50.78
pence (2022: 58.83 pence). As a result,
we are pleased to recommend a final
dividend of 10.26 pence and, if approved
by shareholders, this will give a total
dividend for the year of 20.52 pence
(2022: 18.81 pence).
Simon Dodd
Chief Executive
24 May 2023
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Corporate
Governance.
56 Chairman’s corporate governance statement
58 Board of directors
61 Leadership team
63 Corporate governance report
71 Audit committee report
77 Remuneration committee report
82 Directors’ report
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Corporate Governance
Chairman’s corporate governance statement
“ As a board we want
to drive growth and
deliver long-term
sustainable value for all
our stakeholders. In all
our decision-making,
we aim to do the right
thing, in the right way,
at the right time. This
approach and culture
are underpinned by our
corporate governance
model which seeks
to ensure that good
governance standards
are welcomed and
adopted throughout our
business at all times.”
Stephen Goodyear
Chairman
On behalf of the board, it gives me great
pleasure to introduce this year’s corporate
governance report.
on page 67. This appointment further
strengthened the independence and
diversity of the board.
As a board, we are stewards of the
company. It is our responsibility to ensure
that the company’s strategy is aligned
with the interests of our investors and
takes account of the interests of all our
stakeholders. As individuals, we believe
that effective corporate governance
is based on honesty, integrity and
transparency, and can only be fully
realised within an environment of open,
robust, and effective debate. This is the
board culture we foster at Young’s, and it
is my responsibility as chairman to ensure
that we continue to live this culture and
promote it within our business.
The company applied the Quoted
Company Alliance Corporate Governance
Code (‘QCA Code’) throughout the
period. It provides the right governance
framework for us: a flexible but rigorous
outcome-oriented environment in which
we can continue to develop, as needed,
our governance model to support our
business. I am pleased to report again that
the ten broad principles around which
the QCA Code has been constructed are
effectively embedded in our governance
model, our ways of working and
our behaviours.
The board continues to evolve and there
have been a number of changes during
the year. In July, Patrick Dardis stepped
down as chief executive, and he was
succeeded by Simon Dodd, who was
recruited in 2019 with succession in mind.
Mark Loughborough joined the board
as retail director in September 2022.
Mark has spent 11 years with Young’s in
a number of senior roles, and it gave me
great pleasure to recommend him as an
internal candidate for promotion to the
board as an executive director.
We conducted an external search for a
further non-executive director during the
year, and in March 2023 Sarah Sergeant
joined the board as an independent non-
executive director. Further information
on the search process can be found
I can also report that in January this year,
the board agreed to extend the terms
of office for both me and Nick Miller
through to April 2026. In deciding to do
this, the board determined that we made
an effective and valuable contribution to
the board, demonstrated commitment to
our roles (in my case, as non-executive
chairman, and, in Nick’s case, as senior
independent non-executive director,
chair of the remuneration committee and
as a member of the audit committee),
and were able to give sufficient time to
Young’s.
During the year, an external board
evaluation was undertaken for the first
time. The evaluation was facilitated
by Lintstock Limited. The feedback
from the evaluation confirmed that
the board and each of its committees
continue to operate effectively, and
that each director continues to make
an effective contribution and retains
a strong commitment to their role.
The development themes that arose from
the evaluation are discussed on page 69.
The board’s strategy and model to grow
the business and drive shareholder value
are set out on pages 10 and 15. It is
usually against that background, and
a mission statement of “delighting our
customers with stylish pubs and hotels”,
that the board makes decisions and
manages risk.
The board continued to set clear
expectations concerning the group’s
culture and values. By way of example,
each person starting at one of our pubs
received a formal induction which not
only covers the company’s vision and
values, but also explains how we go about
caring for our customers, right from their
decision to come to our pubs through
to a goodbye at the end of their visits.
This is so important if we are to develop
our people to delight our customers.
The learnings from the induction
programme then become instinctive
over a team member’s time with us.
For information: an index setting out where to find each of the disclosures required to be published by the QCA Code appears at the
end of the corporate governance information part of the ‘Companies Act and AIM Rules compliance’ page within the investors section
of www.youngs.co.uk.
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We accept that simply setting expectations
is insufficient and it is important for the
board to lead by example: it was therefore
regularly seen out and about engaging
with our team members, customers, and
others. The executive team communicated
regularly with the teams in the pubs and
at our head office, through meetings
and messages and at events. Being seen
isn’t always good, sometimes just fading
into the background whilst observing
and listening can be really educational.
Our relatively informal approach here
was supported by more formal processes
– we encouraged customer feedback
(both directly to the pubs and via online
booking review platforms) and there
were also staff appraisals. Together, these
provided invaluable insight into how we
were seen to behave and led the board
to believe that the group had a healthy
corporate culture throughout the business.
Further details on our corporate
governance arrangements (reflecting the
broad principles in the QCA Code and
their application) appear in the following
pages and on our corporate website.
Overall, I very much feel that the essence
of the QCA Code is fully reflected and
observed in our business, and a regular
review by me with our company secretary
will ensure that this remains the case in
the years to come.
To finish, I remain ever aware of the
importance of ensuring that we regularly
engage with you, our shareholders.
On page 70 we have set out what we do
in this regard; the AGM is a key part of
this, and I look forward to welcoming you
to this year’s AGM in Wandsworth on
Thursday, 6 July 2023.
Stephen Goodyear
Chairman
24 May 2023
Clear statements of behaviour are also
issued by the board. An anti-bribery
statement is available on our corporate
website and our team members are
encouraged to refer contractors and
suppliers to this. We also have an anti-
bribery policy. Both the statement and
policy confirm that we have a zero-
tolerance stance on bribery, and they
repeat the board’s expectation that
everyone behaves at all times honestly,
professionally, fairly and with integrity.
The policy is circulated to everyone at
Copper House and to all pub managers;
it is also contained in each pub employee’s
contract of employment. Our slavery and
human trafficking statement, likewise,
published on our corporate website, also
explains to external stakeholders that we
seek to conduct our business honestly
and with integrity at all times and that we
recognise that it is not acceptable to put
profit above the welfare and wellbeing of
our employees and those working on our
behalf. Steps to combat modern slavery
are taken seriously, and preventative
measures are embedded across all
departments throughout our organisation,
to ensure we play our part in helping to
stamp out slavery and human trafficking.
A whistleblowing policy is also in place:
this allows our employees to raise any
concerns in confidence directly with the
chair of the audit committee, the company
secretary or the group’s internal audit
and risk manager. Experience to date
suggests that this policy is effective and
widely known.
We firmly believe that by encouraging
the right way of thinking and behaving,
across all our people, our corporate
governance culture is reinforced.
This enables us to conduct business
sustainably and responsibly and it allows
us to drive our premium, customer-
focussed, people-led strategy and deliver
value for our shareholders. Within this
framework, those managing our pubs
are encouraged to be entrepreneurial,
while supported by policies, processes
and an extensive training programme
that assists in protecting the business from
unnecessary risk.
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Key milestones
during the period
19 May 2022
Full-year results
We released our full-year results
5 July 2022
AGM
Our shareholder AGM was held
at Wandsworth Town Hall
Board changes
Patrick Dardis stepped down
as chief executive and he was
succeeded by Simon Dodd
7 July 2022
Final dividend
A final dividend of 10.26 pence
per share was paid to shareholders
30 September 2022
Board changes
Mark Loughborough was appointed
as retail director and Patrick Dardis
stepped down from the board
2 December 2022
Interim dividend
An interim dividend of 10.26 pence
per share was paid to shareholders
18 January 2023
Board evaluation
Lintstock presented its feedback
from the company’s first externally
facilitated board evaluation
1 March 2023
Board changes
Sarah Sergeant was appointed
as an independent non-
executive director
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Corporate Governance
Board of directors
Stephen Goodyear
Non-Executive Chairman
Simon Dodd
Chief Executive
E D
Commenced role
April 2017 (appointed to the board in February 1996)
Commenced role
July 2022 (appointment to the board in September 2019)
Skills and experience
Stephen has considerable knowledge of, and passion for, Young’s and
the industry. He began his career with Courage Ltd in 1974 and joined
Young’s in 1995. In 2003, he became chief executive and oversaw the
sale of the Ram Brewery, the creation of the tenanted Ram Pub Company
and the transformation of Young’s into a premium managed house
business. The latter involved the acquisition of Geronimo Inns at the
end of 2010 and the creation of a growing ‘pubs with rooms’ operation.
In 2016, Stephen stepped down as chief executive and became a
non-executive director. Stephen is approachable, measured, calm and
influential, and provides invaluable support to the chief executive.
As chairman, he is impartial and objective and encourages open
and constructive debate.
Skills and experience
Simon was appointed chief executive in July 2022. He joined the company
as chief operating officer in September 2019 with responsibility for the
group’s managed house operations, including marketing. Having spent
more than 20 years working in the pub and brewing sector, Simon has a
wealth of experience. Before starting at Young’s, Simon was an executive
director at Fuller’s and managing director of their beer company (2016-19)
– previously, he was the operations director of their City pubs division (2015-
16). Prior to joining Fuller’s, Simon was chief operating officer at the Orchid
Pub Company (2013-14) and commercial director (2006-13). With his
experience, knowledge and retail marketing background, Simon makes
a strong contribution to the well-established Young’s business.
Other relevant external appointments
The Independent Family Brewers of Britain (member)
British Beer and Pub Association (member)
Liveryman for the Brewers’ Company
Mike Owen
Chief Financial Officer
Commenced role
September 2019
E D
Tracy Dodd
People Director
Commenced role
September 2016
E D
Skills and experience
Mike has overall stewardship of the group’s finance functions
(including strategy, forecasting, reporting, tax, treasury, and risk
management) and, since 1 October 2020, is responsible for the
group’s technological needs. He has a strong passion for the industry
having been group finance and IT director at Hall & Woodhouse Ltd
(2016-19), head of European and then global deployment in the global
business services division of SAB Miller PLC (2014-16) and finance and IT
director at Miller Brands (UK&I) Ltd (2008-14). Due to his influence and
involvement in the business, and his open and engaging personality and
management style, the leadership he provides benefits not just his direct
reports and team but a much wider section of the company’s people.
Mike is a qualified accountant.
Skills and experience
Tracy is responsible for all things people including HR, recruitment,
development, health and safety and succession planning. She joined
Young’s in 2015; prior to this Tracy was at the Orchid Pub Company
(2006-14) where she held several senior positions including head of
learning and development. Tracy plays a pivotal role ensuring our rich,
premium (slightly quirky) heritage lives throughout the business, whilst
remaining cognisant of the important regulatory backdrop including
equality, gender diversity and team wellbeing. As a previous operator,
Tracy leads by example, has a strong team ethic, and communicates
seamlessly across all levels of the business.
Other relevant external appointments
Hospitality Apprenticeship Board (member)
Other relevant external appointments
Liveryman for the Brewers’ Company
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Mark Loughborough
Retail Director
Commenced role
September 2022
E D
Nick Miller
Senior Independent Non-Executive Director
R A
Commenced role
April 2017
Skills and experience
Mark was appointed to the board as retail director in September 2022
and is responsible for the group’s managed operations, including food
development. Mark has a BSc in Business Economics and joined Young’s
as operation’s manager in February 2011, being promoted to director
of operations in 2017 and senior director of operations in 2021. He has
over 25 years of experience in hospitality and has played an important
role in shaping the operational direction of Young’s over the last decade.
Mark works with a positive disposition and is known for his drive for
innovation and creative thinking.
Other relevant external appointments
The company’s UKHospitality representative
Skills and experience
Nick has a wealth of experience in hospitality, leisure and brewing.
He was the CEO of Meantime Brewing Company (2011-16) and before
that he was the MD of Miller Brands, the UK arm of SAB Miller, the
multinational brewing and beverage company. Nick has an excellent
reputation in the industry. He is a particularly perceptive businessman,
with significant experience and demonstrable career success at both
Meantime and SAB Miller. With this background, he is able and prepared
to challenge the executive directors, and he provides a strong and valuable
external perspective to the board. Through a combination of his executive
experience, strength of character and willingness and ability to engage, he
is well placed to lead the remuneration committee and act independently.
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Ian McHoul
Independent Non-Executive Director
Commenced role
January 2018
Skills and experience
Ian is a chartered accountant and an experienced non-executive director.
Aside from the current appointments listed below, he has recently been
a senior independent director at Britvic Plc (2014-22) and has been a
non-executive director at Premier Foods plc (2004-13) and John Wood
Group plc (2017-18). Ian was the CFO at Amec Foster Wheeler plc
(2008-17); before that, he had a variety of positions in the brewing and
licenced retail industry, including at Scottish & Newcastle plc, where he
was group finance director, and Inntrepreneur Pub Company Ltd (1985-
2008). With his considerable sector experience and strategic and financial
acumen, his contributions both in and outside of board meetings are
insightful. He also brings financial astuteness to his chairmanship of the
audit committee. At a personal level, his ability to listen, build trust and
encourage allows him to mentor others.
Other relevant external appointments
Bellway Plc (director)
Videndum plc (chairman)
A R
Torquil Sligo-Young
Non-Executive Director
Commenced role
October 2020 (appointed to the board in January 1997)
Skills and experience
Torquil joined Young’s in 1985, becoming an executive director in
1997. During his time as a director, he was responsible for personnel,
health and safety, and the group’s technological needs, and he also
headed up the company’s in-house CSR team. In 2020, Torquil
stepped down as an executive director and became a non-executive
director. He is chairman of a charitable trust set up by William Allen
Young, a founder of the business, and, due to his length of service and
knowledge of Young’s, is chairman of Young’s Pension Trustees Limited,
the trustee company that manages the Young & Co.’s Brewery, P.L.C.
Pension Scheme. Torquil brings a calmness to his position and, being a
member of the founding family, he helps the company keep in touch with
family shareholders.
Other relevant external appointments
William Allen Young Charitable Trust (chairman of the trustees)
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Corporate Governance
Board of directors continued
Aisling Meany
Independent Non-Executive Director
A R
Sarah Sergeant
Independent Non-Executive Director
A R
Commenced role
September 2021
Commenced role
March 2023
Skills and experience
Aisling has considerable investment banking, capital markets and
financial services experience. She is currently a director of Rothschild
& Co Equity Markets Solutions Limited., COO of the equity advisory
business and a managing director in the equity advisory team.
During her 13 years at Rothschild & Co. she has also held the
positions of director in the corporate development and strategy team
and vice president in the financial institutions M&A team. Aisling is
a trustee of Kiftsgate Court Gardens and Estate, holds a Master’s
in Finance from the London Business School and qualified as a
chartered accountant with PricewaterhouseCoopers.
Skills and experience
Sarah has a wealth of experience in the leisure/hospitality and property
sectors and brings considerable financial, strategic, and operational
experience to the Young’s board. She is currently the chief financial
officer, and an executive director of Watkin Jones PLC. Sarah was
previously the chief financial officer of the UK & Ireland region at
Compass Group PLC. During her 13-year tenure at Compass, she
held a number of senior finance and operational roles, including group
financial controller, M&A Director, and CFO of the Asia Pacific region,
based in Singapore. Sarah is a chartered accountant.
Other relevant external appointments
Trustee of the Charleston Trust (Bloomsbury in Sussex)
Committee Membership
A Audit committee
D Disclosure committee
E Executive committee
R Remuneration committee
A Chair of committee
Chris Taylor
Company Secretary
Commenced role
April 2021
Skills and experience
Chris provides counsel to the board on various governance, legal
and regulatory issues affecting the group. He also provides leadership
and advice on sustainability. Chris is an experienced chartered secretary
having held positions at a number of listed companies including
Guinness, Diageo and Orange, and prior to joining Young’s he
was company secretary of Sky plc. He was also part of the Young’s
company secretarial team earlier in his career. Chris is a Fellow
of the Chartered Governance Institute. He has an authentic and
approachable style and provides valuable advice and support to
the board, executive and wider business.
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Leadership team
Kara Alderin
Director of Operations
Kara oversees operations of Young’s pubs with rooms,
stretching from Wandsworth to the Cotswolds and across the
South of England. Kara has specific responsibility for leading
the operations teams, capital development investments and
acquisitions, sales and profits, Young’s Rooms strategy, and
delivery of our individual differentiated pub proposition.
Kara studied Hospitality Management and joined Young’s in
July 2020 having previously worked for Abokado and Fuller’s.
Tom Durham
Director of Retail Finance & Planning
Tom provides financial support to the chief financial officer
and the pub operations team. He manages a team of eight
people leading on areas such as budgeting and forecasting,
financial reporting, business partnering and commercial finance.
Tom is a qualified accountant and joined Young’s in October
2014 having previously worked for Marriott International and
SSP Group plc.
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Stuart Gallyot
Director of Property
Jon Falarczyk
Director of Operations
Stuart heads up the property team and has overall responsibility
for delivering the capital expenditure and development plans for
existing pubs, acquisitions of new pubs in premium locations,
maintenance of the buildings and estate management. Stuart is
a chartered surveyor and joined Young’s in November 2021.
He has thirty years’ experience in the licensed trade having
previously worked for Stonegate, Ei Group, Punch Taverns,
and Scottish & Newcastle Retail.
Jon was appointed director of operations in October 2022
and oversees the operations of South West London, Central
London, the City and the home counties. He has specific
responsibility for sales and profit conversion, succession and
development of operations managers, oversight of delivery,
return on capital expenditure projects and integration of new
acquisitions. Jon studied Hospitality Management and joined
Young’s as an operations manager in March 2018, having
previously worked for a number of years at Mitchells & Butlers.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
61
Corporate Governance
Leadership team continued
Gail Khan
Director of HR
Chris Knights
Director of Food
Grant MacFarlane
Director of IT
Gail oversees the HR function, with
responsibility for HR support, policy design
and employee relations.
Gail graduated from the University of
Cape Town with a BSS in Industrial &
Organisational Psychology and from
Kingston University with a post-graduate
diploma in Human Resource Management.
She is a Fellow of the Chartered Institute
of Personnel & Development. Gail joined
Young’s in May 1995 and is a trustee
of the company’s pension and life
assurance schemes.
Chris has responsibility for the group’s
food operations including development of
food menus, suppliers, delivering health
and safety within the business, overseeing
the succession and development of chefs
and kitchen teams, and ensuring the
appropriate training and development
programmes are put in place. Chris is
a chef by trade and joined Young’s in
April 2011 having previously worked
within food service, retail and an array of
restaurants and pubs.
Grant leads the technology function within
Young’s, overseeing a team of retail,
infrastructure, systems development, and
support professionals. He also manages
the relationships with our external
software, hardware and support partners.
Grant holds a BA in Economics and
Business Law, and an MSc in Information
Systems Management. He joined Young’s
in July 2022 with over twenty years of
hospitality experience, having previously
led technology teams for national and
international hotel groups.
Gillian McLaren
Director of Marketing
Aly Neale
Director of Operations
Gillian leads the group marketing
strategy and is responsible for driving
premium value through individuality,
consistency, brand awareness, growing
and strengthening our community of
advocates, and broadening reach through
digital and sales conversion. Gillian is also
responsible for commercial procurement of
our premium drink offer and maximising
commercial value. Gillian is a Fellow of
the Chartered Institute of Marketing and
joined Young’s in August 1998 having
previously worked for Scottish & Newcastle
plc, Courage Limited, KLM Royal Dutch
Airlines & TrustHouse Forte.
Aly oversees pub operations in the
North, West and South London regions.
Whilst leading business excellence and
innovation within her region, Aly has
specific responsibility for sales and profit
conversion, succession and development of
operations managers, oversight of delivery
and return on capital expenditure projects.
Aly joined Young’s in 2023, having
previously worked at 580 Group,
Fuller’s, Mitchells and Butlers, Marriot
and other independent business and
consultancy organisations.
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Corporate governance report
Leadership
The role of the board and its committees
The board
The board is collectively responsible for the success of the company and the business and management of the group.
Its role includes:
• approving the group’s long-term objectives, commercial strategy and annual budgets;
• overseeing the group’s operations, ensuring competent and prudent management, sound planning, adequate accounting
and other records, and compliance with statutory and regulatory obligations;
• ensuring maintenance of sound management and internal control systems; and
• approving acquisitions and disposals.
The board takes a long-term outlook and sees itself as responsible to a wide range of stakeholders, whilst pursuing its objectives in
a manner consistent with its statutory duties, for the benefit of the company’s members as a whole.
The board governs mainly through its executive management and via committees, the principal ones of which are listed below.
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The directors are selected on the criteria of proven skill and ability in their particular field, and their diversity of outlook and experience,
which directly benefits the operation of the board as the custodian of the business. A full biography of each board member is provided
on pages 58 to 60.
Executive committee
It is responsible for the daily
running of the group and
the execution of approved
policies and the business plan.
It usually meets weekly, with
members of staff invited to
attend as appropriate.
Additional meetings are held
as required.
Audit committee
Its primary focus is on
external corporate reporting
and on monitoring the
company’s internal control
and risk management
systems. Further details
on the committee’s
responsibilities and activities
are on pages 71 to 76.
Remuneration committee
Its primary function is to
determine, on behalf of the
board, the remuneration
packages of the executive
directors. Further details
on the committee and the
company’s reward policy are
on pages 77 to 81.
Disclosure committee
Its primary function is to
assist the company in making
timely and accurate disclosure
of information required to
be disclosed in order to
meet legal and regulatory
obligations.
Chair1
Simon Dodd
Chair
Ian McHoul
Chair
Nick Miller
Chair
Mike Owen
Other members2
Mike Owen
Tracy Dodd
Mark Loughborough3
Other members
Nick Miller
Aisling Meany
Sarah Sergeant4
Other members
Ian McHoul
Aisling Meany
Sarah Sergeant4
Other members2
Simon Dodd
Tracy Dodd
Mark Loughborough3
1 Simon Dodd assumed the role of chief executive on 5 July 2022 and became chair of the executive committee.
2 Patrick Dardis ceased to be a member of the executive committee and disclosure committee when he stepped down from the board on 30 September 2022.
3 Mark Loughborough was appointed to the board on 30 September 2022 and joined the executive committee and disclosure committee with immediate effect.
4 Sarah Sergeant was appointed to the board on 1 March 2023 and was appointed to the audit committee and remuneration committee on 15 March 2023.
The terms of reference for the audit, remuneration and disclosure committees can be found in the investors section of
www.youngs.co.uk. The executive committee has no formal terms of reference.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
63
Environment supportive
of challenge
The effective operation of the board
is dependent on the inherent checks
and balances within the various board
roles. As highly qualified and successful
individuals in their respective fields, all
non-executive directors influence, debate
and contribute to decisions relating to the
strategy of the company, its performance,
and its impact on stakeholders. Open and
constructive debate in meetings was
always encouraged by the chairman, and
non-executive directors are encouraged
and expected to offer alternative
viewpoints and challenge perceptions and
decisions as appropriate.
Corporate Governance
Corporate governance report continued
Board meetings and
reserved matters
Meetings
The board meets every two months, with
additional meetings arranged as required.
It met six times during the period,
excluding the strategy meeting held in
January. Most meetings take place at
Copper House; occasionally, they are held
at one of the group’s pubs, thus providing
the board with further opportunities to
keep up to date with the group’s business
and how particular pubs are performing.
Formal meeting agendas, made up
of regular and other specific business
matters, and supporting packs were
provided to board members sufficiently
in advance of each meeting to ensure
there was time for these to be reviewed.
The agendas were prepared by the
company secretary and agreed with the
chairman and the chief executive.
Included in the pack for each of the
board’s scheduled meetings was a report
from the chief executive, a summary of
financial performance in the year-to-date,
a latest financial forecast, an operations
report from the retail director, a health
and safety report, a people report and
details of any material claims against the
group. At the meetings, the executive
directors expanded upon what was
covered in their reports, and the company
secretary updated the board on matters
for which he was responsible. The chairs
of the company’s audit, remuneration
and disclosure committees also reported
formally on the proceedings of their
committees and minutes of those
committee meetings were made
available to members of the board.
Time is regularly put aside at board
meetings to discuss the company’s
strategy and members of staff are
invited to attend board meetings to give
presentations and/or provide updates
on developments in their areas of
responsibility. During the year the board
has received strategy presentations
from the director of marketing, director
of property, director of IT, the head of
recruitment and development, a director
of operations and ESG updates from the
sustainability manager, director of property
and the company secretary.
The formal flow of information in board
meetings was in addition to information
exchanged outside of those meetings,
often in relation to ad hoc matters that
needed considering between meetings.
The directors also received, usually on a
weekly basis, the group’s sales numbers,
and on a monthly basis, a management
accounts pack that included: a summary
of the group’s financial and non-financial
performance; sales information for drink
and food for the periods; and the group’s
financial position and cash flow. The non-
executives also met with the chair or one
or more of the executive directors outside
of board meetings.
The annual strategy meeting gives
management and the non-executives an
opportunity to discuss a variety of matters.
Once the strategy is agreed, management
is able to build the budgets for the
following year and develop longer-term
plans. J.P. Morgan Cazenove attended
this year’s strategy meeting and the key
matters covered included:
• the group’s long-term business plan
and a re-affirming of the group’s
strategy and business model;
• the group’s equity and capital structure;
• the group’s acquisition strategy
and capital investment; and
• consumer trends and insight.
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Matters reserved for the board
The board maintained a formal written schedule of matters reserved for its review and approval; this schedule includes those matters
described on page 63 under The role of the board and its committees, as well as those in the following table:
Category
Strategy and management
Structure and capital
Financial reporting and controls
Contracts
Communication
Board membership and other appointments
Remuneration
Delegation of authority
Corporate governance
Policies and procedures
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Examples
Extension of the group’s activities into new business or geographic
areas; cessation of the operation of all or any material part of the
group’s business.
Changes relating to the group’s capital structure; major changes to the
group’s corporate or management and control structure; changes to the
company’s listing or its status as a plc.
Approval of the following: annual report and accounts, preliminary
announcements of results, significant changes in accounting policies
or practices, treasury policies, certain unbudgeted capital or operating
expenditure; declaration or recommendation of dividends; review and
approval of expenditure authorisation limits.
Contracts in the ordinary course of business material strategically or
by reason of size; contracts not in the ordinary course of business;
major investments.
Approval of resolutions, circulars, prospectuses and press releases
concerning matters decided by the board.
Changes to the structure, size and composition of the board; ensuring
adequate succession planning for the board and senior management;
board appointments; selection of the chairman and the chief executive;
appointment of the senior independent non-executive director;
membership and chairs of board committees; continuation in office
of directors; appointment or removal of the company secretary;
appointment, re-appointment or removal of the external auditor to be put
to shareholders for approval, following the recommendation of the audit
committee.
Approving the remuneration policy for the directors; determining the
initial remuneration of the non-executive directors; introduction of new
share incentive plans or major changes to existing plans.
Division of responsibilities between the chairman and the chief executive;
establishing board committees and approving their terms of reference.
Undertaking any formal and rigorous review of the board’s own
performance, that of its committees and individual directors, and the
division of responsibilities; determining the independence of non-
executive directors; review of the group’s overall corporate governance
arrangements; authorising conflicts of interest where permitted by the
company’s articles of association.
Approval of the following: manual on compliance with the AIM Rules
and aspects of the UK Market Abuse Regulation, company’s insider list
manual, dealing code, anti-bribery policy, whistleblowing policy and health
and safety policy.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Corporate Governance
Corporate governance report continued
Directors and company secretary
Roles and responsibilities
There is a clear division of responsibility at the head of the company.
Chairman
Is responsible for:
•
•
• creating an environment for open, robust and effective
leading an effective board;
fostering a good corporate governance culture;
debate; and
Chief executive
Has overall responsibility for:
• proposing the strategic focus to the board;
implementing the strategy once approved;
•
• managing the group’s business; and
• advancing long-term shareholder value, supported by the
• ensuring appropriate strategic focus and direction.
management team.
Senior independent director
Acts as a sounding board for, and provides support and advice
to, the chairman and other board members. Also available to
shareholders and any of the directors should they have a question
or concern that cannot be raised through the normal channels.
Non-executive directors
Are required, amongst other things, to constructively challenge
and contribute to the development of strategy, to scrutinise
the performance of management in meeting agreed goals and
objectives and to monitor the reporting of performance. They
play their part by being knowledgeable business people who
bring a wide range of skills and experiences to the board.
Executive directors
They are responsible for the day-to-day running of the business.
See pages 58 and 59 for their particular roles and areas
of responsibility.
Company secretary
The company secretary is responsible for the following in respect
of effective board operation:
•
to advise the board through the chairman of all corporate
governance developments;
• ensure good information flows within the board and its
committees between senior management and non-executive
directors; and
facilitate directors’ induction and assisting with ongoing
training and development.
•
Attendance at board and committee meetings
Meeting attendance
Number of meetings
Stephen Goodyear
Simon Dodd
Mike Owen
Tracy Dodd
Mark Loughborough1
Patrick Dardis2
Nick Miller
Ian McHoul
Torquil Sligo-Young
Aisling Meany3
Sarah Sergeant4
Board
6
6/6
6/6
6/6
6/6
3/3
3/3
6/6
6/6
6/6
5/6
1/1
Audit committee
3
–
–
–
–
–
–
3/3
3/3
–
3/3
–
Remuneration committee
4
–
–
–
–
–
–
4/4
4/4
–
4/4
–
1 Mark Loughborough was appointed as an executive director on 30 September 2022 – he attended all meetings of the board that he was eligible to attend.
2 Patrick Dardis stepped down as an executive director on 30 September 2022 – he attended all meetings of the board that he was eligible to attend.
3 Aisling Meany missed one board meeting due to illness.
4 Sarah Sergeant was appointed as an independent non-executive director on 1 March 2023 – she attended all meetings of the board that she was eligible to attend.
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Subject to the company’s articles of
association, shareholders can, by passing
an ordinary resolution, appoint any willing
person as an additional director or as
a replacement for another director.
New directors undertake a tailored
induction programme which will involve
spending time with each of the executive
directors in trade. They also receive
education and training on the AIM Rules
from the company’s nominated adviser.
The company secretary will spend
time with any new director, ensuring
they understand the key policies and
procedures they need to comply with,
and they also provide the new director
with an induction pack covering or
containing a variety of matters, including:
• regulatory matters (e.g. the company’s
articles of association, the AIM Rules,
the company’s manual on compliance
with the AIM Rules and aspects of
the UK Market Abuse Regulation, the
company’s dealing code, the company’s
insider list manual and a note on
directors’ duties);
• internal policies (e.g. anti-bribery;
whistleblowing and a schedule of
matters reserved for the board);
• internal information (e.g. diary dates
and D&O certificates);
• public information (e.g. latest annual
and interim reports and any circulars
issued in the last 12 months); and
• terms of reference for the
audit, remuneration and
disclosure committees.
Non-executive director
succession
The board monitors the tenure of
non-executive directors to ensure
that it plans sufficiently in advance
of retirements from the board to
ensure an orderly succession of
non-executive directors.
Independence
The board currently comprises ten
directors, made up of four executive
directors and six non-executive directors.
Four of the non-executive directors are
determined to be independent by the
board. On appointment the chairman
did not meet the independence criteria
having previously been the company’s
chief executive. The board believes that
it is important for a company like Young’s
to have continuity and an understanding
of the history and traditions of the
company. Stephen Goodyear has been
an invaluable support to our new chief
executive as he transitioned from chief
operating officer. Torquil Sligo-Young is
not independent for similar reasons, as he
was an executive director of the company.
Torquil plays an important role on the
board. Not only does he retain a long-
standing family shareholding, he is also
the company’s link with the Young’s
family who retain a significant stake
in the company.
The independent non-executive directors
bring a wide range of experience to the
group’s affairs and carry significant weight
in board discussions.
Balance and size
In view of the relevant experience, skills
and personal qualities and capabilities
that each director brings to the board
(as summarised on pages 58 to 60)
the directors consider that the board
is well-balanced, and no single person
dominates discussions.
Nominations, appointments
and inductions
Typically, the chairman and the chief
executive lead on the board nomination
and appointment process, although
following the recent board evaluation
(see page 69 for further details) an
independent non-executive will also lead
the process going forward. They consider
the balance of skills, knowledge and
experience on the board and make
appropriate recommendations for
consideration by the whole board.
Each board member is invited to meet
with the candidate. This process has been
used effectively for a number of years and
has led the board to remain of the view
that it should continue to operate in this
way, rather than through a more formal
nomination committee.
The importance of diversity, including
gender balance, is acknowledged in
making any appointment – against this
background, the board believes that
appointments should be merit-based
against the selection criteria created for
any given role.
The board started a search for an
additional independent non-executive
director during the period. At the outset,
the board identified the required skills
and experience and an external search
agency, Egon Zehnder (‘EZ’), was
appointed to undertake the search. EZ are
not connected with the company or any
directors, and having previously worked
with the company they understand the
business culture and the type of individual
who would work well with the board.
EZ helped create the role specification
and a longlist of candidates was reviewed
by the chair, chief executive, and
people director. Initial meetings were
held with a shortlist of candidates and
a preferred candidate was identified.
Subsequent interviews were held with the
non-executive directors. The board then
considered the new and complementary
skills the candidate would bring to the
board and approved the appointment of
Sarah Sergeant as an independent non-
executive director. Sarah joined the board
on 1 March 2023 and her biography is
set out on page 60.
On 5 July 2022, Simon Dodd was
appointed chief executive, succeeding
Patrick Dardis who stepped down as chief
executive after the company’s AGM, and
as an executive director on 30 September
2022. Simon was recruited in 2019
with succession planning in mind and
his excellent leadership skills, vision and
operational experience are already proving
to be great assets to the company.
In addition, Mark Loughborough
joined the board as retail director on
30 September 2022. He has a wealth
of experience, having spent 11 years
with the company in a number of senior
roles, most recently as senior director
of operations.
Other senior appointments below board
level are made by the chief executive in
discussion with the chairman.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Corporate Governance
Corporate governance report continued
Re-appointment of directors
and notice periods
Once appointed, the company’s articles
of association ensure that any new
director is subject to re-appointment by
the company’s voting shareholders at
the next AGM – this applies to Mark
Loughborough and Sarah Sergeant at this
year’s AGM. Directors are then subject
to a further re-appointment vote at every
third AGM after that – this applies to
Simon Dodd, Mike Owen, Tracy Dodd
and Nick Miller at this year’s AGM.
All are seeking re-appointment.
Subject to shareholder re-appointment,
the executive directors have been
appointed for indefinite periods. They are
generally entitled to not less than one
year’s notice if the company wishes to
terminate their appointment; in return,
they must give not less than one year’s
notice if they wish to leave.
The non-executive directors have
been appointed for fixed terms which
are terminable earlier by them or the
company giving not less than six months’
notice and they are likewise subject to
shareholder re-appointment.
In January this year, following confirmation
that they were willing to continue to serve
as non-executive directors, the board
agreed to extend the terms of office for
both Stephen Goodyear and Nick Miller
through to April 2026. In deciding to
do this, the board determined that both
directors made an effective and valuable
contribution to the board, demonstrated
commitment to their roles and were able
to give sufficient time to the company.
The expiry dates of their current fixed
terms are below:
Non-executive director
Stephen Goodyear
Nick Miller
Ian McHoul
Torquil Sligo-Young
Aisling Meany
Sarah Sergeant
Time commitment
The executive directors are expected
to devote substantially the whole of
their time, attention and ability to their
duties, whereas, as one would expect,
the non-executives have a lesser time
commitment. Apart from the chairman,
who has agreed to spend 30-50 days
a year on work for the company, it is
anticipated that each of the non-executives
will dedicate 15-20 days a year. The non-
executive directors have all confirmed that
they are able to allocate sufficient time to
meet the expectations of their role, and
they are required to obtain the chairman’s
agreement (or, in the case of the
chairman, the chief executive’s agreement)
before accepting additional commitments
that might affect the time they are able
to devote.
Service contracts and letters
of appointment
Copies of the executive directors’ service
contracts and copies of the letters of
appointment of the non-executive
directors are available for inspection
at the company’s registered office.
Training and development
From time to time, the directors, as
appropriate, attend training courses,
conferences and/or industry forums,
read technical and other journals and
undertake online learning to keep up to
date on various matters. They also attend
relevant specialist briefings, some of
which form part of board and executive
committee meetings. The executive and
non-executive, regularly spend time
out in the trade with fellow directors,
shareholders, members of staff, colleagues
and industry representatives: this helps
them to keep up to date with the group’s
operations, developments in the market
and the competition.
Fixed term expiry date
3 April 2026
3 April 2026
23 January 2024
30 September 2023
31 August 2024
28 February 2026
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The company secretary provides
education and training to the executive
directors on the company’s manual
on compliance with the AIM Rules
and aspects of the UK Market Abuse
Regulation, and to all the directors on the
company’s dealing code. The company’s
nominated adviser also provides education
and training to all the directors annually
on the AIM Rules. The board also
benefited from regular presentations
from within the business.
Advice for directors
Subject to certain limitations, all
the directors are entitled to obtain
independent professional advice at the
company’s expense.
J.P. Morgan Cazenove and Slaughter
and May are long-standing advisers to
the board. The former is the company’s
nominated adviser and joint broker;
in its capacity as nominated adviser,
it is responsible to the London Stock
Exchange for providing advice and
guidance in relation to the company’s
continuing obligations resulting from its
admission to AIM. Slaughter and May is
an international law firm headquartered
in London that the board calls on for legal
advice and services from time to time.
Conflicts of interest
Throughout the period, the board had
a procedure in place enabling it to
consider and authorise situations where
a director had an interest that conflicted,
or could possibly conflict, with the
interests of the company; this is set out
in article 63 of the company’s articles
of association. The board reviewed the
board’s conflicts during the financial year
and concluded that conflicts had been
appropriately authorised and that the
process for authorisation was working
effectively. The board will continue to
monitor and review potential conflicts
on a regular basis.
In relation to the appointment of
Simon Dodd to the board in 2019,
the board took steps to ensure that
the company’s internal controls and
processes were reviewed prior to him
starting employment with the company.
Minor changes were required to
ensure that the roles and authorities
were appropriately separated to avoid
potential conflict situations with his spouse
Tracy Dodd.
On his appointment as chief executive
the board took further steps to strengthen
its processes. As a result, on an ongoing
basis, Tracy’s personal objectives and
performance reviews are undertaken
by the chairman, who meets with
her regularly and conducts formal
performance reviews on a quarterly basis.
Her remuneration is the responsibility
of the remuneration committee, and
the chief financial officer approves her
expenses. The company’s internal controls
and processes are reviewed on a regular
basis and Simon and Tracy’s roles and
authorities remain appropriately separated.
Simon and Tracy continue to perform
impressively, and the chairman regularly
discusses the composition of the board
and the performance of the executive
directors with the non-executive directors,
and they are comfortable with the current
composition of the board and the steps
that have been taken to avoid any
potential conflict situations.
Liability insurance cover for
directors and officers
The company maintains, at its own
expense, insurance cover in respect
of legal action against its directors
and officers.
Board evaluation
The board undertakes a formal review
of the effectiveness of its performance
every two years. Internal evaluations
were undertaken in 2018 and 2020.
The reviews were led by the chair and
involved the completion of a questionnaire
on an anonymous basis, with anonymity
intended to encourage more open and
constructive comment.
The board considered the timing
and approach to the 2022 board
evaluation, and recognising the value
and independent insights that would be
provided by an external board evaluator,
the board agreed that an externally
facilitated exercise was the most suitable
approach at this time.
An initial review of potential external
board evaluators was undertaken by
the company secretary, who engaged
directly with the shortlist of providers
to understand their approaches to the
various evaluation methods and fit
with Young’s.
With feedback received from the
chairman, chief executive and wider
board, Lintstock Limited (‘Lintstock’),
which has no other connection with the
company or any of its directors, was
appointed to undertake the evaluation
exercise, which would involve the
completion of a series of questionnaires by
each director and the company secretary,
followed up with individual interviews.
Lintstock prepared the questionnaires
for the board, audit and remuneration
committees, as well as individual
performance questionnaires. The board
members and the company secretary
completed the questionnaires in
November and individual interviews
were conducted during December.
Lintstock analysed the results of the
questionnaires in conjunction with their
own observations and the feedback
given by the directors in their interviews.
They compiled a draft report which was
shared with the chairman, chief executive,
and the company secretary. There were
no significant revisions made to the report
before it was issued to the board.
The findings from the external board
evaluation were presented by Lintstock
at a board meeting held in January 2023
and suggested recommendations were
reviewed and discussed by the board.
Conclusions of the 2022 review
The overall picture of the review
was positive:
• the board benefits from a collegial
atmosphere which values the Young’s
culture. There were constructive
relationships between board members;
• the board and committee meetings
were well managed, efficiently
run and provided an appropriate
environment for open discussion and
constructive debate;
• the committees performed well and
managed their respective duties
effectively; and
• the board was effective at setting
strategic objectives and preparing the
company for the future.
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Actions from the 2022 review
As ever, the evaluation process provided
a helpful opportunity for the directors
to take a step back, reflect and consider
how they work and highlight areas for
future development.
Areas to be considered during
FY23 include:
• continued to develop the board
dynamic under the new chief executive
following a number of board changes;
• create more opportunities to hold
board meetings and visit some of the
company’s pubs outside London;
• invite internal and external speakers
to share their views on key strategic
matters in order to stimulate debate and
enhance board discussion;
• implement a board portal solution
to manage board and committee
papers; and
• consider the appointment
of a remuneration advisor
to provide guidance to the
remuneration committee.
Actions against these areas will be
reported in next year’s annual report.
As required by its terms of reference,
the audit committee carried out a review
of its constitution and terms of reference
to ensure it was operating at maximum
effectiveness. Some minor changes
were proposed and put to the board
for approval.
Throughout the year, the chief
executive informally appraised the
individual performance of each of
the other executive directors as part
of his regular one-to-one meetings
with them. Individual development
needs were discussed, as well as areas
in which the executives could seek
mentoring guidance.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Corporate Governance
Corporate governance report continued
Risk
The board as a whole oversees risk.
With the chief executive having overall
responsibility for implementing the
group’s strategy, it is the executive
committee, as a group under his
leadership, that is primarily responsible
for keeping abreast of developments
that may affect delivery of that strategy
(especially in terms of their likelihood and
impact), identifying any mitigating actions
that could be taken and then ensuring,
as far as possible, those actions are taken
– here the executive team’s experience
and management, collectively and
individually, is vital. That informal process
then feeds through to the whole board
when it considers, on an annual basis, the
list of principal risks and uncertainties for
inclusion in the strategic report (see pages
44 to 47). Additionally, the executive
committee regularly considers the group’s
financial controls memorandum – this
comprehensive and internally-focussed
document identifies a number of finance-
related risks and, for each of them, sets
out the potential business impact, potential
for occurrence, what mitigating controls
are in place and who within the business
has responsibility for managing the
control. Any changes to the document
are considered by the audit committee
before being submitted to the board for
approval. Although the board has overall
responsibility for the group’s systems of
internal control and risk management and
for reviewing their effectiveness, the audit
committee performs an important role in
monitoring those systems – a summary of
what the committee did during the period
in this regard is in the Audit committee
section starting on page 71.
Shareholder relations
Copies of the annual report (which
includes the notice of AGM) and the
interim report are made available
to all shareholders and they can be
downloaded from the investors section of
www.youngs.co.uk. The annual report is
mailed to those shareholders who have
requested a hard copy. Going forward, the
interim report will only be made available
to shareholders via the company’s website.
Other information for shareholders
and interested parties is also provided
on the company’s website, including
the preliminary and half-year results
presentations to the City.
The company has an ongoing
programme of individual meetings with
institutional shareholders and analysts
following the preliminary and half-
year results presentations to the City.
These meetings allow the chief executive
and the chief financial officer to update
shareholders on strategy and the group’s
performance. Additional meetings with
institutional investors and/or analysts are
arranged from time to time. All board
members receive copies of feedback
reports from the City presentations and
meetings, thus keeping them in touch
with shareholder opinion.
Stephen Goodyear and Torquil Sligo-
Young are the key contacts with the
company’s family shareholders, with
Torquil having an important role to play
in keeping them abreast of developments
within the business. Nick Miller, as the
senior independent non-executive director,
and the other non-executive directors are
all willing to engage with shareholders
should they have any questions or
concerns that are not resolved through
the normal channels. The company
secretary can also be contacted by
shareholders on matters of governance
and investor relations.
The board particularly supports the use
of the AGM to communicate with private
investors. The AGM is well attended, and
all shareholders are given the opportunity
to ask questions and raise issues; this can
be done formally during the meeting or
informally with the directors after it.
At the AGM, the company proposes a
separate resolution on each substantially
separate issue. For each resolution, proxy
appointment forms are issued which
provide voting shareholders with the
option to vote in advance of the AGM
if they are unable to attend in person.
All valid proxy votes received for the
AGM are properly recorded and counted
by Computershare, the company’s
registrar. All resolutions proposed at
the meeting will be decided on a poll in
accordance with current recommended
best practice. As soon as practicable after
the conclusion of the AGM, the results
of the meeting are released through
a regulatory information service and
a copy of the announcement is posted
on the company news page within the
investors section of www.youngs.co.uk.
This announcement also provides, for
information, details of the total number
of voting shares in issue and the number
of shares in respect of which valid proxy
appointments were received; a table is
included showing the number of votes for
and against each resolution and also the
number within the chairman’s discretion –
excluded from the table are abstentions/
votes withheld and proxy appointments
received from holders who appointed
someone other than the chairman of
the meeting as their proxy.
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Audit committee report
“ During the year,
the committee has
continued to play a
key oversight role on
behalf of the board.
The committee’s major
tasks have focused on
financial reporting,
internal control and
risk, internal audit,
external audit,
compliance and
governance.”
Ian McHoul
Committee Chair
Areas of responsibility
The committee’s responsibilities are split into four main areas, with the following
principal tasks:
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External audit
• Overseeing the company’s
relationship with Ernst & Young
LLP (‘EY’), the external auditor,
reviewing the effectiveness of the
company’s external audit process,
along with EY’s findings, and
assessing EY’s independence
• Recommending to the board the
appointment, re-appointment
and removal of the company’s
external auditor
• Approving the terms of
engagement of, and the
remuneration to be paid to, the
company’s external auditor
Internal audit
• Reviewing, assessing and
approving the company’s internal
audit plan, monitoring and
assessing the effectiveness of the
company’s internal audit function
in the context of the company’s
overall risk management system
• Reviewing periodically reports on
the results from the internal audit
and risk manager’s work
Financial reporting
• Monitoring the integrity of the
company’s financial statements
and results announcements,
including reviewing any key
accounting and audit judgements
and assumptions made regarding
going concern
• Advising the board on whether,
taken as a whole, the content of
the company’s annual report is
fair, balanced and understandable,
and whether it provides members
with the information necessary
to assess the company’s financial
position, performance, business
model and strategy
• Reviewing the consistency and
appropriateness of, and any
changes to, accounting policies
and practices
Internal control and risk
management
• Monitoring the integrity,
adequacy and effectiveness of the
company’s internal control and
risk management systems
• Reviewing the company’s
systems, procedures and controls
for detecting fraud and for the
prevention of bribery
• Reviewing the adequacy and
security of the company’s
arrangements for its employees
and contractors to raise concerns
in confidence about possible
wrongdoing in financial or
other matters
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Committee meetings
and attendance
The committee met three times
during the period (in May, November
and March) and the table on page 66
sets out each member’s attendance
record. Stephen Goodyear and
Torquil Sligo-Young have a standing
invitation to attend committee
meetings. However, their attendance
is as observers and in a non-voting
capacity. The chief executive and
the chief financial officer joined
all the meetings to report on their
areas. Other business and finance
executives and representatives from
the external auditor, EY, and the
internal audit and risk manager
attend meetings at the request
of the committee. The assistant
company secretary acts as secretary
to the committee.
Corporate Governance
Audit committee report continued
the group’s information systems
security arrangements, including an
updated systems security management
policy; and
the committee’s own performance and
the independence, financial literacy
and other skills and experience of the
committee’s members.
The committee considered the impact
of climate change on the company and
potential ESG costs and reviewed the
plan for reporting on the Task Force on
Climate-Related Financial Disclosures
(‘TCFD’) in FY24.
The committee also approved the
appointment of a new internal audit and
risk manager, who joined the company
in April 2023.
After ensuring it was aligned to the key
risks of the company’s business, the
committee agreed an internal audit plan
for FY24 in May 2023.
The committee continued to oversee EY
so as to ensure the delivery of a robust
audit plan.
Committee membership
The committee, chaired by Ian
McHoul, comprises the board’s four
independent non-executive directors.
All of whom served on the committee
throughout the period, apart from
Sarah Sergeant who was appointed
by the board on 15 March 2023.
The members of the committee
consider that they have the requisite
skills and experience to fulfil the
committee’s responsibilities.
These and the committee’s other duties
are set out in the committee’s terms of
reference which can be found in the
investors section of www.youngs.co.uk.
Major tasks
During the period, the major tasks
undertaken by the committee comprised
reviews of the following:
the group’s preliminary
announcements of interim and final
results, and the results themselves,
all prior to review by the board;
the appropriateness of adopting a
going concern basis of preparation
of the financial statements;
the value of the group’s freehold
pub estate;
deferred tax arising on the valuation
of the group’s freehold pub estate;
asset impairment assessments for
goodwill, right-of-use assets and
fixtures and fittings;
acquisition accounting and disclosures
for the Carpenter’s Arms (Tonbridge),
the Griffin Inn (Fletching), Bedford
Arms (Chenies), Merlin’s Cave
(Chalfont St Giles), Half Moon
(Windlesham), and the Wild Duck
(near Cirencester);
EY’s performance as the company’s
external auditor and the effectiveness
of the audit process;
the group’s systems of internal control
and risk management;
the group’s financial
controls memorandum;
the group’s whistleblowing procedures
and the group’s internal procedures
and controls for detecting fraud and
preventing bribery;
the company’s cyber security measures;
the results of various internal
audit findings;
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Advice, guidance and information
Formal agendas and reports are provided to the committee generally a week before its meetings, along with other information to enable
it to discharge its duties. The following are the most significant items of information, documents and reports provided to the committee
during the period:
Financial reporting
and external audit
Reports from the chief financial officer on
various matters, including key accounting
considerations and judgements, and the company’s
going concern status
Full and half-year review reports, prepared by EY
Internal control
and risk management
Changes to the financial controls
memorandum
Internal audit
Progress reports on FY23 internal audit plan
including results of internal audit reviews,
the effectiveness of controls and various
risks associated with them
Whistleblowing procedures including
their effectiveness
An actions tracker for any outstanding
matters as a result of findings made
Review of EY independence and management
representation letters
IT systems security update
Financial year-end audit planning report prepared
by EY
Schedules of non-audit work performed by EY
A plan to prepare for TCFD reporting
Operational support managers’ audit results
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Significant matters considered in relation to the financial statements
The following table sets out what the committee regards as the significant matters considered by it in relation to the group’s financial
statements and how they were addressed.
How this is addressed
Matter
Going concern assessment The group adopted the going concern basis of reporting in the preparation of the financial statements.
The committee reviewed various scenario-based models underpinning the going concern assumption,
the impact on the group from cost inflation, the growth rate of the business, the resulting impact on cash
flow and the overall capital position of the group. Note 25(b) on page 131 sets out the banking facilities
that the group has available. The group expects, by the end of June 2024 (the ‘going concern’ period),
to have available facilities of £185.0 million, with the board yet to decide on replacing the two £10.0
million facilities due to expire end May 2024. EY reported to the committee on the cash flow forecast
models prepared by management and evaluated whether the assumptions were realistic, achievable,
and consistent with the external and internal environment. As a result of the above, the committee was
satisfied that the going concern basis of reporting was appropriate.
Value of the group’s
pub estate
Deferred taxation
This number is by far the largest number on the balance sheet at 3 April 2023; note 19 on page 124
explains the valuation exercise undertaken. The committee focussed its attention on understanding and
challenging the annual valuation exercise and the appropriate accounting approach and disclosures; it
did this by reviewing the approach, the key assumptions, the valuation reports, and other documentation
analysing the outcome of the exercise. Management’s valuation process, which was supported by the
company’s valuation experts, was also reviewed by EY’s property specialist, enabling EY to report to
the committee that the valuation exercise was in accordance with accounting standards and in line with
common practice in the industry. As a result of the above, the committee was satisfied that a thorough
and robust valuation exercise had been undertaken, with appropriate challenges by EY and the
committee, and that appropriate values were reflected in the balance sheets at 3 April 2023.
Management, with help from the group’s in-house tax manager, made certain judgements and
produced detailed calculations supporting the estimated deferred tax movement and year-end balance.
The workings supported the deferred tax liability on the rollover relief and property revaluations on each
pub, as well as the treatment of capital losses, indexation and initial recognition exemptions. EY audited
these calculations and workings. The outcome being the committee was satisfied that the deferred tax
provision shown in the balance sheets at 3 April 2023 was appropriate.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
73
Corporate Governance
Audit committee report continued
Matter
Asset impairment
Pub acquisitions
How this is addressed
Management completed full impairment tests on certain categories of assets across the group’s pub
estate which included goodwill, right-of-use assets and fixtures and fittings. Having used both internal
and external factors in the impairment testing, including preparing a financial model and forecast on the
future growth prospects, management’s assessment found there to be no material impairment required.
EY then corroborated those qualitative and quantitative factors against industry knowledge, prior year
audit conclusions and EY’s expectations, as well as full-year trading performance and future forecasts.
The committee acknowledged that certain adverse changes to the assumptions in the impairment tests,
could result in a future impairment of those assets, but concluded that, at this stage, no impairment
was necessary, and the disclosures reflected those sensitivities – note 18 on page 122 sets out further
information on these sensitivities.
During the period the group purchased six pubs for a total cost of £24.0 million. Five of the acquisitions
were accounted for as a business combination and involved several judgements, particularly in identifying
and determining the fair value of the assets acquired and liabilities assumed. One of the acquisitions was
accounted for as an asset purchase. EY reported to the committee on the assets and liabilities acquired
and were satisfied that the identified assets and values were complete and accurate. The committee
ultimately concluded that the disclosures made in the balance sheet at 3 April 2023 are in accordance
with IFRS 3.
EY’s independent auditor’s report on pages 88 to 94 provides further detail on how some of the above matters were addressed.
Non-audit work carried
out by EY
Throughout the period, the company had
a formal policy in respect of non-audit
work carried out by EY whilst appointed
as the company’s external auditor;
this was in place to mitigate any risks
threatening, or appearing to threaten,
EY’s independence and objectivity
arising through the provision of services
in addition to the statutory audit. Non-
audit services are generally prohibited
from being performed by EY unless
they fall within a narrow list of permitted
services closely related to the audit and/
or required by law or regulation; there
are then additional safeguards that apply
so as to avoid, amongst other things, EY
auditing its own work and/or making
management decisions for the company.
Where the carrying out of certain work
is permitted, the committee must still
nevertheless approve the engagement.
During the period, the company engaged
EY for a limited amount of non-audit
work comprising the FY23 interim review,
preparation of turnover rent certificates
for the Bull (Westfield, Shepherd’s Bush)
and the Cow (Westfield, Stratford) and
provided a subscription to a library of
accounting information and guidance.
The total fees paid to EY during the period
for non-audit services amounted to £48k
being 9.0% of total fees paid to EY during
the period (2022: £40k and 10.0%).
In the committee’s view, the nature and
extent of the non-audit work carried out
by EY did not impair their independence
or objectivity.
Qualification, objectivity,
independence and proposed
re-appointment of EY
The committee felt that the qualification,
expertise, resources and effectiveness
of EY were appropriate in the context
of the group wanting an effective and
high-quality service, and that EY was
independent of the group and not reliant
on fees from the group. The committee
concluded that EY’s work had been robust
and perceptive, with EY’s reports showing
a good understanding of the company’s
business. As part of its assessment process,
the committee:
reviewed the audit plan for the period
ended 3 April 2023 as regards the
activities to be undertaken by EY and
EY’s final audit results report, and
considered how EY had handled the
key accounting and audit matters that
had arisen;
had been provided with a copy of
the Financial Reporting Council’s
July 2022 audit quality inspection
report in respect of EY and a copy
of EY’s published audit quality and
transparency reports for the UK.
The Audit Quality Review team of the
Financial Reporting Council (‘FRC’)
considered certain aspects of EY’s audit
of our 2022 consolidated financial
statements. Having received a full copy
of the findings, the committee was
pleased to note that no key findings
arose from the review, with only three
minor areas for improvement noted.
These areas have been discussed with
EY and the committee is satisfied that
they were addressed appropriately
during the 2023 audit;
reviewed an independence report
prepared by EY, which contained all
significant facts and matters bearing
upon EY’s integrity, independence
and objectivity that EY was required to
communicate to the company as per
the FRC Ethical Standard and ISA (UK)
260 ‘Communication of audit matters
with those charged with governance’;
considered EY’s proposed fees for the
group’s audit for the period ended
3 April 2023 and the additional non-
audit services for that same period; and
obtained the views of management.
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The fees paid to EY for audit services
for the period ended 3 April 2023 were
£0.5 million (2022: £0.4 million).
As a result of the above assessment process,
the committee has recommended the
re-appointment of EY as the company’s
auditor, and EY has expressed its willingness
to continue. A resolution to re-appoint EY
and a resolution to enable the directors
to set EY’s remuneration will therefore be
proposed at the forthcoming AGM.
Audit firm and
partner rotation
The external auditor is required to
rotate the audit partner responsible
for the engagement every five years.
The prior year audit partner rotated off the
engagement following the conclusion of
the FY22 audit, and their successor is in
place for the first time for the FY23 audit.
In turn the current audit partner will be
required to rotate after the FY27 audit.
In August 2018, the committee decided
that the group’s statutory audit for the
financial year ending 2020 should be
put out to tender as EY had been in
office, as auditor, for more than 15 years.
This was a matter of good corporate
governance and the committee being
satisfied with EY’s qualification, objectivity,
independence, and overall service.
The tender process followed best practice
guidance issued by the FRC. In mid-
December, the committee concluded
that it was appropriate to recommend
the re-appointment of EY as the
company’s auditor.
The committee intends to conduct an
audit tender in advance of its March 2028
year-end, which will be within ten years of
the last tender process.
Risk and internal control
The board has overall responsibility for
the group’s systems of internal control
and risk management and for reviewing
their effectiveness. These systems cannot
eliminate risk and are therefore designed
to minimise and manage it – they provide
reasonable but not absolute assurance and
seek to:
• mitigate risks which might cause the
failure of business objectives;
• prevent material misstatement or loss;
• help safeguard assets against
unauthorised use or disposal;
• ensure the maintenance and reliability
of proper accounting records and
financial information used within the
business or for publication; and
• help achieve compliance with applicable
laws and regulations.
The executive directors are responsible
for implementing and maintaining the
systems, and the committee assists
the board in fulfilling its oversight
responsibilities by monitoring the
systems’ integrity.
The group’s strategic priorities and their
connection to the principal risks and
uncertainties facing the business are listed
on page 15. This is not an exhaustive list
of all significant risks and uncertainties;
some may currently be unknown and
others currently regarded as immaterial
could turn out to be material.
The following is an overview of the main
parts of the group’s systems of internal
control and risk management:
• clearly defined reporting lines up to
the board;
• clearly set levels of authorisation
throughout the business;
• a detailed financial
controls memorandum;
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•
the preparation of a comprehensive
annual budget and the preparation of
a vision document which is reviewed
and approved by the executive
directors and then further reviewed
and approved by the board;
the circulation of monthly management
accounts, including commentary on
significant variances, updated profit and
cash flow expectations for the year and
actual capital expenditure compared to
budget and signed-off sums;
• a detailed investment approval process
requiring board authorisation for all
pub purchases and major projects
(with regular performance reviews
of invested pubs for a certain period
post-investment);
• board approval for disposals;
• regular reporting of material claims and
legal and accounting developments to
the board;
• regular circulation of the group’s
anti-bribery policy to Copper
House employees and pub general
managers, and assessment of head
office employees’ understanding of
that policy;
•
the group’s internal audit function
and the group’s in-house team of
operations support managers; and
• ongoing health and safety audits and
monitoring of accident statistics, with
audit results being a standing item at
board meetings.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Corporate Governance
Audit committee report continued
The group’s internal audit and risk
manager sits within the finance team, with
a clear line of communication to both the
chair of the committee and the company
secretary, remaining independent of the
areas under review. The internal audit
and risk manager performs internal
reviews of financial, compliance, risk
management and operational areas
according to a programme set by the
committee, following input from the
chief financial officer. Audit findings,
management responses and progress
on recommended actions are presented
to the committee. Management may
supplement the internal resource for
these reviews with specialist external
resources; however, none were perceived
as being required during the period.
The internal audit function also reviewed
the design and operation of the group’s
key controls, as documented in the
group’s financial controls memorandum.
The results of this work were shared with
the executive directors concerned and
with the committee; with that committee’s
approval, the memorandum was updated.
During the year, the internal audit function
focussed on:
• key financial controls at head office
and pubs;
•
IT general controls for the key
finance system;
• compliance with group policies at
operational level; and
• compliance with relevant industry
regulations, and legislation.
Ongoing assessment and monitoring of
key risks took place throughout the year,
with internal audit having the ability to
propose adding or replacing planned
elements of the work programme to
the audit committee. No changes were
required during the year.
Throughout the period, a team of
operations support managers (led by
the head of retail audit) undertook a
programme of retail audits across the
managed house estate. Through these
audits, they independently reviewed
compliance with business policies, and
they provided best practice support to
pub management, principally in the
areas of stock and cash management.
The team holds relevant knowledge and
experience to perform this role, drawn
from their time as members of the finance
department after employment in one or
more of the group’s pubs. Summary retail
audit results for the group’s operating
divisions are presented regularly to
senior management, including the
executive directors.
Regular updates on the progress of
a number of projects to enhance the
security of the group’s IT infrastructure
were presented to the audit committee
throughout the year.
The group has business continuity
arrangements in place with third parties.
It also has business continuity plans
for each of the departments within
Copper House.
The group has a whistleblowing policy
that is overseen by the committee.
This policy allows staff to raise any
concerns anonymously and in confidence
directly with the chair of the committee,
the company secretary or the group’s
internal audit and risk manager.
The audit committee believes, based on
experience to date, that this policy is well
communicated in the organisation and
is working well. The policy was reviewed
and updated during the year and any
whistleblowing reports are communicated
to the committee.
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Remuneration committee report
“ The company’s reward
policy is designed to
attract, retain and
incentivise executive
directors who will drive
the company’s strategy
and deliver long-term
sustainable shareholder
value creation.”
Nick Miller
Committee Chair
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Remuneration:
executive directors
The main elements of the executives’
reward packages ordinarily comprise:
• basic salary: the core element of
fixed remuneration which reflects the
executive’s role and experience;
• a range of benefits: including life
assurance, regular medical check-ups,
a car scheme or a car allowance (at
levels set in 2008), private medical
insurance and a pension. The executive
directors pension contribution rate is
aligned with the staff at Copper House
(see note 9(c) on page 115);
• an annual bonus: the short-term
variable element, the company
operates a stretching deferred annual
bonus (‘DAB’) scheme for the executive
directors. The maximum opportunity is
125% of basic salary; and
• a long term incentive plan (‘LTIP’):
implemented during the period
under review, the LTIP incentivises the
executive directors to deliver against
the company’s strategy over the longer
term. The committee has set longer-
term performance conditions which
support the creation of sustainable
shareholder value. The maximum
opportunity is 100% of basic salary.
Primary function
The committee’s primary function is to
determine the remuneration packages
of the executive directors. This is in
the context of the company’s reward
policy which is designed to incentivise
the executive directors appropriately
and support the delivery of the group’s
strategic objectives which are aligned
with the long-term interests of both
shareholders and key stakeholders.
Terms of reference
The committee’s duties are set out in its
terms of reference which can be found in
the investors section of www.youngs.co.uk.
Committee membership,
meetings and attendance
The committee is made up of four
independent non-executive directors. It is
chaired by Nick Miller; the other members
are Ian McHoul, Aisling Meany and Sarah
Sergeant. Nick, Ian and Aisling served on
the committee throughout the period;
Sarah joined the committee in March.
The committee met four times during the
period and the table on page 66 sets out
each member’s attendance record.
Advice, guidance
and information
During the period, Deloitte LLP and
Slaughter and May were engaged to
help the committee in its review of
the company’s long-term incentive
arrangements for the executive directors.
For further details, see the Review of
executive director long-term incentives
section below. Deloitte LLP also kept the
committee informed of market trends,
investor sentiment and proxy advisory
expectations. More generally, advice
and guidance was provided to the
committee by the company secretary.
Where possible, agendas and supporting
papers are provided to the committee
a week before its meetings.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
77
Corporate Governance
Remuneration committee report continued
Performance outcome for
the FY23 annual bonus
The annual bonus drives the achievement
of financial performance and personal
objectives. The committee, in applying its
judgement, assessed the performance of
the business and each executive director
in the context of the wider market.
During the year the business managed
supply chain challenges, a volatile
economy, rising energy costs, rail strikes
and the cost of living crisis. Despite these
challenges the company performed
strongly during the period, and against
its industry peer group.
The table below sets out the key
performance conditions to which the FY23
bonus awards are dependent, expressed
as a percentage of basic salary along with
the overall caps applicable. The inclusion
of personal objectives recognises the
specific executive roles and responsibilities
each executive director has.
Following an assessment of the
performance conditions, the strong
performance of the company and the
performance of each of the executive
directors, the committee determined that
the adjusted profit before tax (‘APBT’)
element of the annual bonus be awarded
at 60%, to reflect the level of APBT
achieved. The ESG and personal objectives
were partially met and the committee
determined overall bonus awards of 64%,
64%, 73% and 63.5% of maximum for
Simon Dodd, Mike Owen, Tracy Dodd
and Mark Loughborough. The bonus
awarded to Mark Loughborough was pro-
rated from 30 September 2022. This is
reflected in the ‘Bonus 2023’ column
in note 9(b) appearing on page 115.
In line with the DAB scheme rules Simon
Dodd, Mike Owen and Tracy Dodd are
required to defer 50% of any annual
bonus award over 50% of maximum
into shares, which are held for at least
three years. Mark Loughborough, who
was appointed as an executive director
during the period, will not be required
to defer his annual bonus, as his outcome
is below the 50% threshold, due to the
pro-ration of his award to time served
as an executive director.
Patrick Dardis stepped down as chief
executive on 5 July 2022. He remained
on the board to oversee the transition
to Simon and retired from the board on
30 September 2022. Patrick remained
available to the company for the
remainder of his notice period through
to the end of March 2023. Patrick was
eligible for an annual bonus for the six-
month period he served as an executive
director. Following the assessment of the
performance conditions detailed above
the committee determined a bonus
award of 64% of maximum, pro-rated
to 30 September 2022. Patrick will not
be required to defer his annual bonus, as
his outcome is below the 50% threshold,
due to the pro-ration of his award to time
served as an executive director.
2022 LTIP grant
The committee granted the first awards
under the LTIP on 29 June 2022.
The awards were in the form of a nil-cost
option and no monetary consideration
was paid for the awards. The committee
decided that the awards would be based
on the following performance conditions:
• two-thirds on the extent to which the
company’s adjusted earnings per share
in respect of the financial year ended on
or around 31 March 2025 exceed the
same measure for the financial period
ended 28 March 2022; and
• one-third on total shareholder return
relative to a comparator group of the
company’s peers.
Simon Dodd
Mike Owen
Tracy Dodd
Mark Loughborough
Patrick Dardis
1 Applies for the second half of the financial year, any bonus award will be pro-rated.
2 Applies for the first half of the financial year, any bonus award will be pro-rated.
3 Applies from appointment, the award with be pro-rated from 30 September 2022.
Adjusted profit
before tax
95%
70%
95%
50%
70%
95%
ESG objective
10%
10%
10%
10%
10%
10%
Personal objectives
20%
20%
20%
40%
20%
20%
Maximum
125%1
100%2
125%
100%
100%3
125%2
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The committee believes that the selection
of these performance conditions will
ensure that the vesting outcome is fully
aligned with the shareholder experience.
The awards were equivalent to 100%
of basic salary for Patrick Dardis and
Mike Owen, and 75% of basic salary
for Simon Dodd and Tracy Dodd.
Mark Loughborough’s award was
granted when he was a member of
the senior management team, prior to
him being appointed as an executive
director. The awards will vest and
become exercisable subject to continued
employment with the company and
the extent to which the performance
conditions are met. The committee
determined that the 2022 LTIP award
granted to Patrick Dardis be pro-rated
to 31 March 2023, the date he retired
from the company. His award is expected
to vest, subject to the extent to which
the performance conditions are met, on
29 June 2025. See note 30(b) on page
142 for a summary of the LTIP awards
granted to the executive directors for
the period.
No long-term incentive awards were
granted in 2020, due to the pandemic
and its impact on the performance of
the company. As a result, there were no
maturities for the committee to consider
at the end of FY23.
Key decisions taken for
FY24 include:
Executive directors’ basic salary
(effective 1 April 2023)
Basic salaries for the executive directors
increased by 5% with effect from 1 April
2023, this was below both general
inflation and the 6% average awarded
to the Copper House team. Basic salary
increases for non-managerial staff in the
company’s pubs were determined in line
with changes to the National Living Wage,
which increased by 9.7% in April 2023.
Mark Loughborough’s basic salary was set
on appointment as an executive director
on 30 September 2022. At that time, the
basic salary was set at less than the market
rate prior to an initial period in role, as the
committee felt it was important to see how
Mark performed in role before moving
him to the market rate. Following good
performance in role, his basic salary was
increased to bring him in line with the
market and his peer group, before the 5%
increase was then applied, resulting in an
effective increase of 13%. In the future, it
is intended that any increases for Mark will
be in line with other executive directors,
and either at or below the average
awarded to the Copper House team.
Annual bonus FY24 –
performance conditions
The maximum annual bonus opportunity
will continue to be 125% of basic salary
for Simon Dodd and Mike Owen, and
100% of basic salary for Tracy Dodd and
Mark Loughborough. There will also
continue to be a share deferral element,
with 50% of any bonus award over 50%
of maximum being invested in shares
and held for three years. The committee
will continue with a mix of APBT, an
ESG objective and personal objectives.
The performance conditions on which
the FY24 annual bonus awards are
dependent, expressed as a percentage
of basic salary along with the overall
caps applicable, will be disclosed in next
year’s report.
2023 LTIP grant
The committee intends to grant a 2023
LTIP award within 42 business days of the
release of the company’s FY23 results.
The awards will be equivalent to 100%
of basic salary for Simon Dodd and
Mike Owen and 75% of basic salary for
Tracy Dodd and Mark Loughborough.
The performance conditions will remain
as described above and the financial
period will run from 3 April 2023 to
on or around 31 March 2026.
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Review of executive director
long term incentives
The committee engaged Deloitte LLP
during FY22 to undertake an independent
review of executive director long-term
incentives which focused on: market
practice, alternative long-term incentive
approaches and the structure of the
company’s current incentive scheme.
Following careful consideration of the
alternative approaches and market
practice, the committee recommended
to the board that an LTIP be introduced.
The benefit of this approach is that
it simplified the company’s incentive
structure, by de-linking the long-term
incentive from the annual bonus.
Executive directors are now incentivised to
meet long-term targets which support the
creation of sustainable shareholder value.
The committee decided that in view
of the introduction of the LTIP, the
operation of the DAB scheme would
change for the period under review and
for future awards. The DAB scheme now
operates as an annual bonus scheme,
which requires executive directors to
defer an element of their annual bonus
(net of taxes, duties or social security
contributions) subject to certain thresholds
being met. Matching shares will no longer
be awarded under the DAB scheme.
The board adopted the LTIP rules on
18 May 2022 and the first awards under
the plan were granted to the executive
directors on 29 June 2022. The revised
DAB schemes rules were adopted by the
board on the 29 June 2022. The rules
of both the LTIP and DAB scheme were
prepared by Slaughter and May and
follow market practice. A summary of the
rules are outlined on the following page.
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Corporate Governance
Remuneration committee report continued
Summary of the LTIP rules:
• Eligibility: any company employee
may be selected to participate in the
plan at the committee’s discretion.
The executive directors and certain
members of the company’s senior
management team currently participate
in the plan.
• Individual limit: awards will not be
granted with a market value in excess
of 100% of basic salary in respect of
any financial year of the company.
• Performance conditions: the vesting of
awards is subject to the satisfaction of
performance conditions. The committee
will determine the period over
which any performance conditions
are assessed.
• Vesting and release of awards: the
committee will assess the performance
conditions as soon as reasonably
practicable after the end of the relevant
performance period. Awards will
normally vest on the vesting date.
• Timing of awards: awards can only be
granted during the 42 days beginning
on the date on which the plan was
adopted by the board, or the business
day after the day on which the
company announces its results subject
to any dealing restrictions.
• Cessation of employment: an unvested
award will usually lapse upon a
participant ceasing to be employed
by or to hold office with the group.
If, however, a participant ceases to
be an employee or director of the
group because of their ill-health, injury,
disability, the sale of the participant’s
employing company or business out
of the group or in other circumstances
at the discretion of the Committee
(i.e. they leave as a ‘good leaver’),
their award will normally continue to
vest (and be released) on the date
when it would have vested (and been
released) if they had not ceased to
be an employee or director of the
group. The extent to which awards
normally vest in these circumstances
will be determined by the committee
in its discretion, taking into account
the satisfaction of any performance
conditions applicable to awards
measured over the original performance
period, the underlying performance
of the company and the participant
and such other factors the committee
considers, in its opinion, relevant.
• Form of awards: the committee may
grant awards as conditional awards of
shares, nil or nominal cost options over
shares. No payment is required for the
grant of an award. awards structured as
nil or nominal-cost options will normally
be exercisable from the expected point
of vesting (or, where an award is subject
to a holding period, the expected point
of release) until the tenth anniversary of
the grant date.
• Sourcing of shares and overall limits:
the plan may operate over new issue
shares, treasury shares or shares
purchased in the market. In any ten-
year rolling period, the number of
shares which may be issued under the
plan and any other employee share
plan adopted by the company may
not exceed 10% of the issued ordinary
share capital of the company from time
to time. In addition, in any ten-year
period, the number of shares which
may be issued under the plan and any
other discretionary employee share
plan adopted by the company may
not exceed 5% of the issued ordinary
share capital of the company from time
to time.
• Malus and clawback: In rare cases of
gross misconduct and misstatement of
results, the committee has the discretion
to clawback some of any share awards
or share delivered for up to two years
from the date of vesting. This discretion
can be used to: (a) reduce an award
(to zero if appropriate); (b) impose
additional conditions on an award or
(c) require that the participant either
returns some or all of the shares
acquired under an award or makes
a cash payment to the company in
respect of the shares delivered.
Summary of the DAB
scheme rules
The DAB scheme rules were refreshed as
part of the wider review of the approach
to executive director remuneration and
the introduction of an LTIP. As a result,
the performance-based matching element
of the previous DAB scheme rules were
removed, so that a more common annual
bonus approach in line with market
practice could be adopted to operate a
scheme, under which an element of any
annual bonus will be deferred into shares
without any additional performance-
based matching element applying to
the deferred element. The new rules
provide the committee with flexibility on
the implementation of bonus deferral.
The intended operation of the bonus
deferral is as follow:
• Up to 50% of the maximum monetary
value of an award will be delivered
entirely in cash, via pay as you earn
(‘PAYE’).
• Any amount above 50% of the
maximum monetary value of an award
will be delivered half in cash, via PAYE,
and half in shares.
– For example: a bonus of 100% of
the maximum monetary value of an
award would be delivered 75% in
cash, via PAYE, and 25% in shares.
– A bonus of 75% of the maximum
monetary value of an award would
be delivered 62.5% in cash, via
PAYE, and 12.5% in shares.
Any deferral of bonus into shares will
be invested net of tax, duties and social
security contributions. The committee
has determined that only the executive
directors will participate in the DAB
scheme going forward. The maximum
monetary value of an annual bonus
under the new rules will be 125% of
the participants then basic salary for the
financial year in question. The committee
intends to restrict executive directors from
dealing in any deferred shares for three
years after the date of allotment or transfer
of the shares.
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The executive committee determined
that the chairman and the non-executive
directors be awarded a 5% basic fee
increase for FY24, which was below both
general inflation and the 6% average
awarded to the Copper House team and
below the company’s wider workforce.
The annual committee chair fee, which
was introduced in FY22 to recognise
the additional work undertaken by
the respective chairs of both the audit
committee and remuneration committee
remained unchanged at £5,000. The non-
executive directors basic fee was increased
from £46,000 to £48,300 with effect
from 1 April 2023.
By order of the board
Chris Taylor
Company Secretary
24 May 2023
Clawback: the committee may, at its
discretion, at any time within three years
of the vesting date of any award, or in
respect of shares received by the executive
directors in relation to an award, be any
period of three years beginning on the
date on which the executive director
receives those shares, clawback all or some
of share award or all or some of the cash
provided or paid under an award if certain
exceptional circumstances apply.
Remuneration: non-
executive directors
The initial remuneration of the non-
executive directors is determined by the
board, but any fee increase is decided
by the executive committee, with the
intention being that the fees paid are not
out of line with the market and go some
way towards rewarding the non-executives
for the time they commit to the business;
accordingly, all non-executive directors
receive a basic fee.
Apart from any entitlement arising from
a previous executive role in the company,
the non-executives do not participate in
bonus schemes or share options and they
are not members of any group pension
scheme other than for the purposes of
complying with pension auto-enrolment
legislation. As a result of having been
executive directors, Stephen Goodyear,
Torquil Sligo-Young and Patrick Dardis
are pensioner members of the group’s
defined benefit pension scheme. At the
end of the period Torquil no longer had
any interest in shares held under the
terms of the previous deferred annual
bonus scheme (see note 30(a) starting on
page 141). The non-executive directors
are entitled to be reimbursed for certain
business-related expenses.
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81
Corporate Governance
Directors’ report
For the 53 weeks ended 3 April 2023
Directors
Details of our directors appear on pages 58 to 60. All of them served throughout the period except for Mark Loughborough who was
appointed as a director on 30 September 2022 and Sarah Sergeant who was appointed as a director on 1 March 2023. No other
person was a director during the period other than Patrick Dardis who stepped down as a director on 30 September 2022.
Directors’ interests in the company’s share capital
Set out below are the interests in the company’s share capital of the directors who held office at the end of the period and of the
persons closely associated with them (as defined in the UK Market Abuse Regulation). These interests are in addition to those shown in
note 9(e) on page 116.
Stephen Goodyear1, 2
Simon Dodd1, 3
Mike Owen1
Tracy Dodd1, 4
Mark Loughborough5
Nick Miller
Ian McHoul
Beneficial
Beneficial
Beneficial
Beneficial
Beneficial
Beneficial
Beneficial
Torquil Sligo-Young1, 2, 6, 7
Beneficial
Aisling Meany
Sarah Sergeant8
Trustee
Beneficial
Beneficial
As at
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
28 March 2022
3 April 2023
A shares
200,424
200,424
6,439
4,163
6,922
3,317
8,041
8,831
–
58,587
58,587
3,000
3,000
269,476
271,069
4,053,100
4,154,340
1,299
–
–
Non-voting shares
3,265
3,265
–
–
2,040
2,040
–
–
–
408
408
2,000
2,000
15,081
15,081
499,591
499,591
–
–
–
1 Also interested in 14,479 (2022: 5,819) A shares held in trust by RBT II Trustees Limited – see note 31 on page 144.
2 Also interested in 337,067 (2022: 337,067) A shares held in trust by Young’s Pension Trustees Limited – see note 31 on page 144.
3 This does not include Tracy Dodd’s interest in the company’s share capital as a person closely associated with Simon Dodd.
4 This does not include Simon Dodd’s interest in the company’s share capital as a person closely associated with Tracy Dodd.
5 Mark Loughborough was appointed to the board in September 2022.
6 Torquil Sligo-Young and various members of his immediate family are discretionary beneficiaries under trusts holding 836,368 (2022: 836,368) of the A shares and 453,543 (2022: 453,543) of the
non-voting shares in respect of which Torquil Sligo-Young is shown as trustee in the above table.
7 This does not include Young’s Pension Trustees Limited’s interest in the company’s share capital as a person closely associated with Torquil Sligo-Young (but see 2 above and note 31 on page 144).
8 Sarah Sergeant was appointed to the board in March 2023.
Profit and dividends
The profit for the period attributable
to shareholders was £29.7 million.
The directors recommend a final dividend
for the period of 10.26 pence per share
(which, subject to approval at the AGM, is
expected to be paid on 13 July 2023 to
shareholders on the register at the close of
business on 9 June 2023). When added
to the interim dividend of 10.26 pence
per share paid in December 2022, this
would produce a total dividend for the
period of 20.52 pence per share.
Disclosure of information
to the auditor
Each of the directors shown on pages
58 to 60 confirms that so far as they are
aware, there is no information needed
by the company’s auditor in connection
with preparing its report of which the
company’s auditor is unaware. Further,
each of them confirms that they have
taken all the steps that they ought to have
taken as a director to make themselves
aware of any such information and to
establish that the company’s auditor
is aware of it. This paragraph is to be
interpreted in accordance with section
418 of the Companies Act 2006.
Qualifying indemnity
provisions
The company’s articles of association
contain an indemnity provision for the
benefit of the directors; this provision,
which is a qualifying third-party indemnity
provision, is in force at the date of this
report and was in force throughout the
period. A further qualifying third-party
indemnity provision is also in force at
the date of this report and was in force
throughout the period; this benefits
Stephen Goodyear and Torquil Sligo-
Young and relates to certain losses and
liabilities which they may incur as a result
of or in connection with anything properly
done by them as attorneys under a
property-related power of attorney made
by the company in May 2016.
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Important events since the
end of the period and likely
future developments
As permitted under section 414C(11) of
the Companies Act 2006, the directors
have chosen to include in the strategic
report (on pages 1 to 54) particulars of
important events affecting the group
which have occurred since the end of the
period and an indication of likely future
developments in the group’s business.
Political donations
No political donations were made during
the period.
Financial instruments
and related matters
Included in note 25, on page 129, are
the group’s financial risk management
objectives and policies and an indication
of the group’s exposure to certain risks.
Those elements of that note form part
of this report and are incorporated
by reference.
Employee engagement
Employee communications remains a
priority and, within the practical limitation
of confidentiality and security, information
was provided to them across a range of
topics including trading and operational
matters, and board and staff changes.
Employees were encouraged to use The
Ram app, delivered by the company’s
e-learning platform, to access the ‘How
are You?’ and ‘Keeping in Touch’ pages
which include a range of information
and resources to enhance and maintain
mental, physical and financial wellbeing
of our employees. Using The Ram app
to communicate with employees ensures
that the company can communicate
directly with every team member across
the company, regardless of their location
or working pattern, which means that
employees working flexibly are not
excluded from communication and
have equal opportunity. Employees have
full flexibility to read and participate in
discussions at work, while travelling or at
home. It also means that employees can
easily access and follow up areas of interest,
such as mental, physical and financial
wellbeing resources, when they have time
to do so.
The company continued to consult with
its employees and their representatives,
using the company’s information and
consultation committee. This long-
established committee works to enhance
communications within the company,
supplying information and giving
opportunity for feedback and consultation,
improve employee awareness and
involvement and to support ongoing
improvement within the business.
Members of the committee are elected
by the employees based in head office,
with team members in the group’s
managed pubs having both an elected
representative and a nominated
management representative, with the
latter being one of the group’s directors
of operations. The committee met
quarterly during the period and a board
member attended two of these meetings
to present an update to committee
members on trading, operational and staff
matters. A briefing sheet, summarising
the outcomes from the meeting, was
communicated within the business – this
was initially emailed to all employees
based in head office, with the group’s
operations managers then being
responsible for cascading that information
down to the pub managers within their
area via divisional meetings and the pub
managers then having to pass it down
further through team briefings within
their pubs. Each representative and
pub manager is responsible for feeding
back the information discussed at the
committee’s meetings, acting as a point
of contact for individuals wishing to
discuss matters and/or raise agenda items
for discussion at meetings, and seeking
further employees’ views and ideas on
matters, all in order to provide feedback to
the board.
As part of ongoing efforts to improve
direct access to the executive directors and
management board members, a ‘Dinner
with Directors’ initiative was introduced
during the period. Each month, an
executive director, with a management
board member, hosts a dinner with
invited general managers, head chefs
and head office-based employees where,
in a relaxed and informal environment,
employees can meet and speak with
senior company representatives. It also
provides a direct forum for feedback,
questions, and discussion in order to
engage employees.
To encourage further involvement and
interest in the group’s performance, the
company operates a savings-related share
option scheme. The company produced
information which was sent to eligible
employees directly and communicated
to all employees using videos on The
Ram app, posters in The Ram Pages and
briefings to all key leaders at divisional
meetings, area meetings and chef forums.
Following the briefings, the information
was cascaded down to pub teams to
ensure all employees were fully informed
about the scheme.
The board maintained its support for the
company’s wellness initiatives, paying
particular attention to employee mental
health and financial wellbeing, taking into
account the impact of recent increases
in the cost of living. The company refers
employees to the confidential counselling
services delivered through the Licensed
Trade Charity (‘LTC’).
The company also continued its
relationship with Salary Finance, an
independent company authorised and
regulated by the Financial Conduct
Authority that offers a range of financial
services, including loans and savings
products, as well as education and
financial tools. During the period, over
250 employees sought their help and
advice, and a number of employees
took advantage of the loan and debt
support they provide. All employee
communications are directly with
Salary Finance, and the company does
not receive any financial benefit or
commission from offering this service.
The company offered mental health first
aid champion training to line managers
across our business, with more than
100 Mental Health First Aiders and
Mental Health First Aid Champions
employed across the company.
Mental Health First Aid Champions
support their colleagues across the
business and signpost them to further
mental health support, as appropriate.
An email address remained available
for employees to report concerns about
others in the workplace; all issues reported
were fully investigated, with advice
or referral to external services where
required. In addition, information on
supporting mental health was published
via The Ram app, which is available to
every employee, signposting employees
who may be experiencing mental health
crises to appropriate services.
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Corporate Governance
Directors’ report continued
The company’s corporate social media
accounts also supported the company’s
positive stance on mental health and a
number of items about mental health
were shared publicly.
The company provided information
about a range of topics, including the
support available to employees, from the
LTC, Legal & General (the company’s
pension plan provider) and Salary Finance.
They were also reminded of the 24/7
helpline and financial support on offer.
The LTC was first established in 1793; it
aims to provide pubs, bar and brewery
people facing a crisis with practical,
emotional and financial support each
year. During the period, more than 172
visits were made to the unique Young’s
landing page on the LTC website, and
the LTC received over 45 calls from
individuals who identified themselves as
the company’s employees. In addition,
financial grants of over £48,000 were
made to the company’s employees.
The company continued to actively
support and promote the Ram Agency,
which allows employees full control of
their working arrangements by choosing
their working pattern and location. In turn,
all businesses across the company can
benefit from fully trained employees
committed to working for the company.
There are now more than 300 Ram
Agency employees which cover front of
house, kitchen and management roles.
The success of this flexible strategy is
consistently demonstrated, such as the
17,200 Ram Agency hours worked across
more than 1,400 shifts in December
2022 and 10,900 hours worked across
more than 1,200 shifts in January 2023.
Employment inclusion
and diversity
The company is an inclusive employer
and diversity is important to it. It therefore
maintained its policy of:
• giving full and fair consideration to all
applications for employment, taking
account of the applicant’s particular
aptitude and ability;
• seeking to continue to employ anyone
who becomes physically and/or
mentally impaired while employed by
the company and arranging training
in a role appropriate to the person’s
changed circumstances; and
• giving all employees equal opportunities
for training, career development
and promotion.
For more on our approach to diversity
and inclusion please see page 29.
Greenhouse gas emissions,
energy consumption and
energy efficiency action
The directors have chosen to include
the ‘Greenhouse gas emissions, energy
consumption and energy efficiency action’
disclosure within the sustainability report
(which forms part of the strategic report,
as permitted under the Companies Act
2006). The disclosure can be found on
page 42 of the sustainability report.
Engagement with suppliers,
customers and others in a
business relationship with
the company
The following section should be read
in conjunction with the Section 172(1)
statement starting on page 20 (as the
directors have chosen to include in
that part of the strategic report further
information as regards the company’s
engagement with suppliers, customers
and others in a business relationship with
the company, as permitted under the
Companies Act 2006).
During the period, the board remained
alert to the importance of how the
company’s long-term success relies,
amongst other things, on good
business relations with this range of
external stakeholders.
The company’s business model and long-
term strategy (summarised on pages 10
and 15) have been tried and tested over a
number of years. Many of the company’s
business relationships have been in place
for quite some time, however, these were
kept under review during the period to
ensure that, the company could continue
to maintain its reputation as a provider of
a market-leading, premium offering that
new and existing customers would want
to enjoy and with which suppliers and
others would want to be associated.
Digital marketing continues to provide
a key communications channel for the
company’s customers. Every step of the
journey matters, building relationships
and strengthening connections before
a customer even steps into our pubs
through to post-visit feedback and review.
In Spring 2022, Atreemo was launched,
a dynamic customer relationship
management platform to build
personalised and trackable digital
campaigns. 17 million personalised
e-mails were sent during the year:
these kept our customers informed,
for example, about events in the pubs,
Young’s Rooms, On Tap treats, menu
launches and new openings. The number
of customer contacts in Atreemo has risen
from 3.3 million to 4.3 million throughout
the period.
The company’s social media channels
continue to be a valuable source to
engage with customers and suppliers.
Our following across all central channels,
Facebook, Twitter, Instagram and LinkedIn
exceeds 80,000 and we have also added
TikTok to our portfolio in the period.
Impressions for the Young’s brand have
achieved over 5 million during the period.
Obtaining social media followers remains
a core strategy for the company’s social
whilst continuing to focus on retaining
our existing audience. We have increased
engagement on Instagram by 85%,
providing us with a very strong and
engaged community. Our pubs are also
encouraged to build strong and engaged
social followings with over 1 million
followers receiving regular communication
and updates from their local pubs.
Online review platforms such as
Google, Facebook, TripAdvisor and
DesignMyNight enabled 80,000
customers to give speedy and relevant
opinions and comments following their
visits, and a cloud-based reputation
management system allowed us to
assimilate the feedback received.
The company’s online bookings have
continued to play an important role in
our pre-booked strategy as a significant
proportion of our customers continued to
book ahead of dining with us.
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Notifications of major
holdings of voting rights
As at 3 April 2023, the company
had been notified of the following
holdings of 3% or more of the voting
rights in the company:
Octopus Investments
Nominees Ltd
Torquil Sligo-Young
James Young
Caroline Chelton
Canaccord Genuity
Group Inc.
BlackRock Investment
Management (UK) Ltd
Lindsell Train Limited
Alice Parasram
13.01%
12.76%
11.20%
10.09%
5.55%
5.04%
4.89%
3.30%
No changes in the above holdings,
and no other holdings of 3% or more
of the voting rights in the company,
had been notified to the company
between 4 April 2023 and 23 May
2023, both dates inclusive.
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The company’s On Tap app continued
to provide a premium, speed efficient
‘order to table’ solution for customers.
Whilst customer numbers using the
app reduced significantly as customers
returned to ordering at the bar, the
app continued to provide an ‘order to
table’ solution for customers especially
within pub gardens. 400,000 customers
used the On Tap app in the period
with 280,000 new On Tap app users.
Together, they placed 1 million orders
to a value of £20 million contributing to
a strong database growth, allowing the
company to communicate with those that
signed up to marketing through enhanced
in-app content and push notifications.
A Quintessentially British Getaway
was the focus of our Young’s Rooms
customer marketing campaign throughout
the summer, tapping into the British
nostalgia surrounding the late Queen
Elizabeth’s Platinum Jubilee year, with
a Winter Retreat campaign running
over the Autumn and Winter months.
These campaigns were communicated
via e-marketing, social channels and paid
social communications.
For the mutual benefit of the company,
its customers and suppliers, the company
continued to leverage the relationships
it had with suppliers, especially those
providing drink products (as drink sales
historically count for roughly 62% of the
company’s sales in any year). So, rather
than just source products from its drink
suppliers and sell them to customers, the
company continued to look at ways of
working more closely, proactively and
collaboratively with those suppliers to
create or increase consumer demand.
Below are some examples of the benefits
resulting from those close, proactive and
collaborative relationships:
• in partnership with Absolut, Young’s
pledged to deliver a more sustainable
Christmas in association with More
Trees, planting an actual tree for
every ‘cocktail tree’ sold in our pubs.
This initiative with Pernod Ricard UK is
estimated to remove up to 36 tonnes of
CO2 from the atmosphere throughout
the trees’ growth life;
• in conjunction with tournament
partners, Budweiser Brewing Group and
Sipsmith, we supported last year’s major
sporting events such as the FIFA World
Cup 2022 and The Championships,
Wimbledon;
• we collaborated with Carlsberg
Marston’s Brewing Company to create
a celebratory Young’s cask ale, All Ale
The Queen, to mark Her Late Majesty
Queen Elizabeth’s Platinum Jubilee,
available at all Young’s pubs;
• Young’s Scotch Egg Challenge returned
to celebrate its 10th anniversary,
hosted at the Guinea Grill, Mayfair
and sponsored by Estrella Damm with
a top line-up of chefs and judges.
Oliver Marlowe and Hugh Beatson-Hird
of the Hunter’s Moon reigned victorious
with their ‘Golden Egg’ with Young’s
own group executive chef, Matt Sullivan
a close runner-up;
• Diageo GB provided support for the
Guinness Six Nations and St Patrick’s
Day 2023 providing rugby shirts and
merchandise together with in-pub
entertainment; and
• an exclusive cask ale, Rocket Ram, was
brewed with Beavertown Brewery to
celebrate Young’s 191st birthday and
Beavertown Brewery’s 10th birthday in
September 2022.
Corporate governance
arrangements
The report on the company’s corporate
governance arrangements is set out
on pages 56 to 81. That report forms
part of this report and is incorporated
by reference.
AIM
The company’s shares are traded on
AIM. There are no other exchanges or
trading platforms on which the company
has applied or agreed to have its shares
admitted or traded.
AGM
Notice convening the AGM is set out on
pages 146 to 150; notes explaining the
resolutions being proposed are on pages
151 and 152.
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Corporate Governance
Directors’ report continued
Statement of certain
responsibilities in relation
to the financial statements
and otherwise
The directors are responsible for preparing
the annual report and the financial
statements in accordance with applicable
UK law and regulations.
Company law requires the directors to
prepare financial statements for each
financial year. Under that law the directors
have elected to prepare the group and
parent company financial statements in
accordance with UK-adopted international
accounting standards (‘IFRSs’).
Under company law the directors must
not approve the financial statements
unless they are satisfied that they give
a true and fair view of the state of affairs
of the group and the company and of
the profit or loss of the group and the
company for that period. In preparing
these financial statements the directors
are required to:
• select suitable accounting policies in
accordance with IAS 8 Accounting
Policies, Changes in Accounting
Estimates and Errors and then apply
them consistently;
• make judgements and accounting
estimates that are reasonable
and prudent;
• present information, including
accounting policies, in a manner that
provides relevant, reliable, comparable
and understandable information;
• provide additional disclosures
when compliance with the specific
requirements in IFRSs is insufficient to
enable users to understand the impact
of particular transactions, other events
and conditions on the group and
company financial position and
financial performance;
• in respect of the group financial
statements, state whether UK-adopted
international accounting standards have
been followed, subject to any material
departures disclosed and explained in
the financial statements;
• in respect of the parent company
financial statements, state whether
UK-adopted international accounting
standards have been followed,
subject to any material departures
disclosed and explained in the financial
statements; and
• prepare the financial statements
on the going concern basis unless
it is inappropriate to presume that
the company and/or the group will
continue in business.
The directors are responsible for keeping
adequate accounting records that are
sufficient to show and explain the
company’s and group’s transactions and
disclose with reasonable accuracy at any
time the financial position of the company
and the group and enable them to ensure
that the company and the group financial
statements comply with the Companies
Act 2006.
They are also responsible for safeguarding
the assets of the group and parent
company and group and hence for taking
reasonable steps for the prevention and
detection of fraud and other irregularities.
Under applicable law and regulations, the
directors are also responsible for preparing
a strategic report, directors’ report
and corporate governance statement
that comply with that law and those
regulations. The directors are responsible
for the maintenance and integrity of
the corporate and financial information
included on the company’s website.
Preparation and disclaimer
This annual report, together with the
strategic report (on pages 1 to 54) and
the financial statements for the period
ended 3 April 2023 have been drawn
up and presented for the purpose of
complying with English law. Any liability
arising out of or in connection with them
will also be determined in accordance with
English law.
By order of the board
Chris Taylor
Company Secretary
24 May 2023
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Financial
Statements.
Independent auditor’s report
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95 Group income statement
96 Group statement of comprehensive income
97 Balance sheets
99 Statements of cash flow
100 Group statement of changes in equity
101 Parent company statement of changes in equity
102 Notes to the financial statements
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Financial Statements
Independent auditor’s report
Independent auditor’s report to the
members of Young & Co.’s Brewery, P.L.C.
Opinion
In our opinion:
• Young & Co.’s Brewery P.L.C.’s group financial statements
and parent company financial statements (the “financial
statements”) give a true and fair view of the state of the
group’s and of the parent company’s affairs as at 3 April 2023
and of the group’s profit for the 53 weeks then ended;
• the group financial statements have been properly
prepared in accordance with UK adopted international
accounting standards;
• the parent company financial statements have been properly
prepared in accordance with UK adopted international
accounting standards as applied in accordance with section
408 of the Companies Act; and
• the financial statements have been prepared in accordance
with the requirements of the Companies Act 2006.
We have audited the financial statements of Young & Co.’s
Brewery P.L.C. (the ‘parent company’) and its subsidiaries (the
‘group’) for the 53 weeks ended 3 April 2023 which comprise:
Group
Balance sheet as at
3 April 2023
Parent company
Balance sheet as at
3 April 2023
Group income statement for
the 53 weeks then ended
Statement of changes in equity
for the 53 weeks then ended
Statement of cash flows for the
53 weeks then ended
Related notes 1 to 34 to the
financial statements including
a summary of significant
accounting policies
Group statement of
comprehensive income for
the 53 weeks then ended
Group statement of changes
in equity for the 53 weeks
then ended
Statement of cash flows for the
53 weeks then ended
Related notes 1 to 34 to the
financial statements, including
a summary of significant
accounting policies
The financial reporting framework that has been applied in
their preparation is applicable law and UK adopted international
accounting standards and, as regards to the parent company
financial statements, as applied in accordance with section 408
of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further described
in the Auditor’s responsibilities for the audit of the financial
statements section of our report. We are independent of the
group and parent company in accordance with the ethical
requirements that are relevant to our audit of the financial
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statements in the UK, including the FRC’s Ethical Standard as
applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that
the directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate.
Our evaluation of the directors’ assessment of the group and
parent company’s ability to continue to adopt the going concern
basis of accounting included:
• In conjunction with our walkthrough of the Group’s financial
close process, confirming our understanding of management’s
going concern assessment process and also engaging with
management early to assess the key factors considered in
its assessment;
• We assessed the reasonableness of the key assumptions,
including cost inflation, in the context of our understanding of
the Group and its principal risks and from other supporting
evidence gained from our audit work. This included review
of minutes of board meetings and our procedures in respect
of goodwill impairment reviews and on other external market
data, including analyst forecasts and the industry outlook;
• Agreeing the group’s available financing and related terms,
including covenants to the original debt agreements;
• Obtaining cash flow forecast models used by the Board in its
assessment, reviewing their arithmetical accuracy, whether they
had been approved by the Board and considering the group’s
historical forecasting accuracy;
• We performed testing to evaluate whether the covenant
requirements of the Group borrowings, as required in
the debt agreements, would be met under all base and
downside scenarios;
• We tested the key inputs to the model, including checking
cash and cash equivalents of £10.7 million at 3 April 2023,
operating cash generation and financing commitments
and agreed them to the latest Board-approved forecasts
that factored in the downside scenarios. We confirmed the
details of the available committed facility of £205 million with
reference to agreements and to third party confirmations;
• We confirmed the calculation of the reverse stress test
scenario and considered the likelihood of occurrence
of the combination of sensitivities applied as remote.
• Assessing the appropriateness of the going concern disclosures
in describing the risks associated with the group’s ability to
continue as a going concern; and
• Considering whether, during our audit procedures, we had
identified any events or conditions beyond 1 July 2024 that
may cast significant doubt on the group’s ability to continue
as a going concern and evaluating whether we were aware
of any such events or conditions from our audit work.
Going concern has also been determined to be a key audit
matter. Based on the work we have performed, we have
not identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast significant
doubt on the group and parent company’s ability to continue
as a going concern for a period to 1 July 2024 from when
the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report. However, because not all future events
or conditions can be predicted, this statement is not a guarantee
as to the group’s ability to continue as a going concern.
Overview of our audit approach
Audit scope
• We performed an audit of the complete
financial information of the group, which
accounted for 100% of adjusted profit before
taxation, 100% of Revenue and 100% of
Total assets.
Key audit
matters
• Valuation of the freehold pub estate
• Asset impairment
• Deferred taxation arising on the valuation
of the pub estate
• Management override in the recognition
of revenue
Materiality
• Overall group materiality of £2.2m
which represents 5% of adjusted profit
before taxation.
An overview of the scope of the parent
company and group audits
Tailoring the scope
Our assessment of audit risk, our evaluation of materiality and our
allocation of performance materiality determine our audit scope
for each company within the Group. Taken together, this enables
us to form an opinion on the consolidated financial statements.
The group’s operations are based solely in the United Kingdom
with a single head office and finance function and therefore
all audit procedures are completed by one audit team at
this location.
In assessing the risk of material misstatement to the Group financial
statements, and to ensure we had adequate quantitative coverage
of significant accounts in the financial statements we performed full
scope audit procedures over 100% of the group’s results for the 53
weeks ended 3 April 2023 and 100% of the group’s total assets at
that date. We obtained an understanding of the entity-level controls
of the group which assisted us in identifying and assessing risks of
material misstatement due to fraud or error, as well as assisting us
in determining the most appropriate audit strategy. This approach
is consistent with the prior period.
Climate change
Stakeholders are increasingly interested in how climate change
will impact the Group. The Group has determined that the most
significant future impacts from climate change on its operations
will be from increased occurrence of extreme weather events,
regulations, government interventions, reporting obligations and
inability to meet climate change targets. These are explained
on page 44 in the principal risks and uncertainties, which
forms part of the “Other information,” rather than the audited
financial statements. Our procedures on these unaudited
disclosures therefore consisted solely of considering whether
they are materially inconsistent with the financial statements or
our knowledge obtained in the course of the audit or otherwise
appear to be materially misstated, in line with our responsibilities
on “Other information”.
In planning and performing our audit we assessed the potential
impacts of climate change on the Group’s business and any
consequential material impact on its financial statements.
Our audit effort in considering the impact of climate change
on the financial statements, with the assistance of our climate
team members with specialist skills, was focused on evaluating
management’s assessment of the impact of climate risk, physical
and transition, and ensuring the effects of material climate risks
disclosed on page 44 have been appropriately reflected in the
carrying value of assets with indefinite and long lives, asset values
and associated values where these are determined through
modelling future cash flows, being goodwill, property and
equipment and right of use assets.
We also challenged the Directors’ considerations of climate
change risks in their assessment of going concern and
associated disclosures.
Based on our work we have not identified the impact of climate
change on the financial statements to be a key audit matter
or to impact a key audit matter.
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Financial Statements
Independent auditor’s report continued
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements
of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we
identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial
statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters.
Key observations communicated
to the Audit Committee
We concluded that the values
of the sample of 38 properties
tested, with the assistance of
our internal property valuations
specialists, were within the
reasonable range of values as
assessed by them.
We consider that management
provided an appropriate level
of review and challenge over
the valuations and we did not
identify evidence of undue
management bias.
We reviewed the disclosures
in note 19 to the financial
statements, and consider them
to be appropriate.
Risk
Our response to the risk
Valuation of the freehold pub estate (£797.5m, 2022: £761.0m)
Refer to the Audit Committee Report (page 71);
Accounting policies (page 104); and Note 19 of
the Consolidated Financial Statements (page 124).
In accordance with the group’s accounting policy
for property and equipment, management applies
the revaluation model for the freehold pub estate,
which had a carrying value of £797.5 million as at
3 April 2023 (28 March 2022: £761.0 million).
As permitted by IAS 16 and in common with
other listed pub operators in the UK, this
revaluation was achieved through:
• A reassessment of the fair maintainable trade
of each freehold pub based on its current and
forecast trading performance, with a capital
value then derived through the application
of a multiplier. Alternatively, a ‘spot’ valuation
where information relating to recent trade is
not available or is not deemed to be indicative
of trading potential;
• A revaluation by Savills, independent chartered
surveyors, of a representative sample of 20%
of the group’s freehold pubs, including pubs
of varying location and type by physical
inspection; and
• A revaluation of the remaining 80% of
the freehold pub estate on a desktop
basis by Savills and the group’s director
of property, using updated trading results,
management’s knowledge of each pub, and
appropriate consideration of the results of the
representative sample valuation.
This involves significant management judgement,
particularly in respect of the methodology
and assumptions used in the valuation model.
Management also assesses viable alternative
uses for a property should they provide
increased value.
The risk has not increased or decreased from
the prior year.
We met with management and the group’s external
valuation specialists to discuss their valuation approach and
the judgements made in determining the fair value of the
freehold pub estate. These included the fair maintainable
trade, EBITDA multiples and the approach to the various
spot valuations.
We assessed the competence and objectivity of the
external valuer, including consideration of its qualifications
and expertise.
We tested the inputs, assumptions and methodology used
by the external valuers, with the assistance of our internal
property valuations specialist. We tested management’s
valuation model for mathematical accuracy and consistency
with underlying records. This included an assessment of
the fair maintainable trade of each pub by reference to the
group’s financial records, management’s historical forecasting
accuracy and its consideration of the external valuation
results on the remainder of the estate using spot values.
Of the group’s 170 freehold properties, with support
from our property valuation specialists we tested a sample
of 38. We performed testing over the underlying valuation
assumptions, with a particular focus on pubs valued using
a spot valuation, pubs not physically inspected by Savills
and pubs where valuation approach has changed from fair
maintainable trade in prior year to spot valuation in the
current year with a significant movement in fair value, as
these involved a higher level of management judgement.
We benchmarked the group’s pub valuations by comparing
with other pub market transactions. We also considered
the approach taken to reflect any ongoing impact of the
economic uncertainties on freehold pub values.
We verified that changes in pub valuations were
appropriately accounted for through the revaluation reserve
or the income statement, with reference to the original cost.
We considered the appropriateness of the valuation
disclosures in note 19 of the financial statements and
whether they were compliant with the fair value information
required under IFRS 13.
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Risk
Our response to the risk
Key observations communicated
to the Audit Committee
Asset impairment
Refer to the Audit Committee Report (page
71); Accounting policies (page 104); and Note
18, 19 and 20 of the Consolidated Financial
Statements (page 122, 124 and 127).
We understood and walked through the methodology
applied by management in performing its impairment test
for each of the relevant pubs, and assessed the design
effectiveness of the key controls that are in place.
We concluded that no
impairment was required at
3 April 2023, based on the results
of our work.
However, the impairment test is
sensitive to adverse changes that
could arise given the uncertainties
surrounding future trading,
including those arising from the
current high levels of cost inflation
and any changes in consumer
spending habits arising from the
‘cost of living crisis’.
Management describes these
sensitivities appropriately in notes
18, 19 and 20 to the financial
statements, in accordance with
IAS 36.
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In addition to its freehold property portfolio,
the group has significant other assets connected
with its pub estate, including goodwill of
£32.5 million (2022: £32.5 million), fixtures,
fittings and equipment of £86.4 million
(2022: £78.1 million) and right of use assets
of £142.9 million (2022: £147.0 million).
The continued uncertainties over the current
economic environment caused by the high levels
of cost inflation and any changes in consumer
spending habits arising from the ‘cost of
living’ crisis, has been identified as an indicator
of impairment.
Impairment is tested on the basis of each
individual cash generating unit (an individual
pub) or in the case of goodwill, the group
of pubs associated with it.
There is a risk that pubs may not achieve
the anticipated business performance to
support their carrying value. This could lead
to an impairment charge that has not been
recognised by management.
Significant judgement is required in forecasting
the future cash flows of each pub, together
with the rate at which they are discounted.
The risk has not increased or decreased from
the prior year.
We assessed the appropriateness of management’s
identification of cash generating units being at the individual
pub level and, in the case of goodwill, the fact that the
goodwill was allocated to the group of cash generating units
(individual pubs) associated with it.
We tested the arithmetical accuracy and integrity of the
impairment model and confirmed that the forecasts were
consistent with the Board approved forecasts and those used
in the going concern assessments.
For those pubs or groups of pubs that assumed more than
a long-term growth rate in the short term, we considered
management’s estimates in the context of the actions
already taken to achieve profit improvement, the expected
impact of other external events and management’s historical
forecasting accuracy.
We used our internal valuations specialists to support our
assessment of the discount rate and long term growth rate
applied to cash flows by independently determining an
acceptable range of values for each assumption.
In respect of the impact of cost inflation and consumer
spending habits on both short-term trading and the longer-
term growth rate, we compared management’s assumptions
against external economic forecasts and actual performance
from the last year.
We calculated the degree to which the key inputs and
assumptions, including location-specific evidence, would
need to fluctuate before an impairment was triggered and
considered the likelihood of this occurring. We performed
our own sensitivities on the group’s forecasts, which included
various scenarios on short term disruption and long-term
growth rate. We then determined whether adequate
headroom remained using these sensitivities and our
independent assessment.
We assessed the disclosures in notes 18, 19 and 20 of
the financial statements against the requirements of IAS
36 Impairment of Assets, in particular the requirement to
disclose further sensitivities for CGUs where a reasonably
possible change in a key assumption would cause
an impairment.
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Independent auditor’s report continued
Key observations communicated
to the Audit Committee
We considered management’s
judgements in the recognition
of deferred tax arising on the
valuation of the pub estate
to be appropriate and the
underlying calculation to be
accurate. We also consider that
the disclosures in note 26 to
the group financial statements
are appropriate.
Risk
Our response to the risk
Deferred taxation arising on the valuation of the pub estate
Refer to the Audit Committee Report (page 71);
Accounting policies (page 104); and Note 26 of the
Consolidated Financial Statements (page 135).
At 3 April 2023 the group had deferred tax liabilities
of £104.6 million (2022: £104.2 million).
There is complexity in the group’s accounting
for deferred tax. Specifically, a significant level of
management judgement and complex calculations
are required in accounting for the deferred tax
arising both on the valuation of each freehold pub
and on the right of use asset for each leasehold pub.
These judgements are focused on:
•
•
•
the treatment of capital losses, rollover
relief, indexation allowances and initial
recognition exemptions;
recognising deferred tax on the pubs on a sale,
in-use or a dual basis;
recognising the deferred tax at the correct
corporation tax rate, depending on the
underlying assumptions; and
• calculating the deferred tax associated with
right of use assets recognised under IFRS 16,
which have a similar risk profile to the freehold
pub estate.
The risk has not increased or decreased from
the prior year.
We performed a walkthrough of the group’s process for
determining the deferred tax arising from the valuation of
the pub estate. We also assessed the design effectiveness of
the key controls that were in place.
In conjunction with our tax team members with specialists
skills we tested the deferred tax calculations based on the
valuation of each freehold pub and the right of use asset
for each leasehold pub. This focused on verifying the inputs
into the deferred tax calculation, testing its mathematical
accuracy and recalculating the deferred tax for a sample
of pubs across the estate. This included a testing of capital
losses, rollover relief, indexation allowances and initial
recognition exemptions.
We considered the assumptions used in calculating the
deferred tax balances, including whether the deferred tax
assumptions were consistent with the group’s intended use
of the freehold pubs – being a sale, in-use or a dual basis.
We evaluated if the tax rates applied in calculating the
deferred tax on the group’s pub estate were appropriate
based on when the balances are expected to unwind.
We considered whether the related deferred tax disclosures,
included in note 26 to the group financial statements, were
in line with IAS 12 requirements.
Risk
Our response to the risk
Management override in the recognition of revenue
Key observations communicated
to the Audit Committee
Refer to the Audit Committee Report (page 71);
Accounting policies (page 104); and Note 7 of
the Consolidated Financial Statements (page 114).
The group recorded revenue from continuing
operations of £368.9 million in the year
(2022: £309.0 million). The vast majority
of the group’s revenue transactions are non-
complex, with no judgement applied over
the amount recorded.
We consider the significant and fraud risk relating
to revenue to be around management override
of controls and topside journals to revenue.
The risk has not increased or decreased from
the prior year.
We performed a walkthrough of each of the group’s
significant revenue processes, including the recording
of manual journal adjustments, and assessed the design
effectiveness of the key controls that are in place.
We applied correlation data analysis over the group’s
revenue journal population to identify how much of the
revenue was converted to cash and to isolate non-standard
and manual revenue transactions. We obtained corroborative
evidence to support these items. We performed cut-off
testing procedures including review of post period end
cash receipts and journals and an analytical review of
significant variances.
We did not identify any instances
of management override of
controls, including through
topside journals. Based on our
work, which included using data
analysis tools to test the group’s
revenue transactions and the
extent to which they converted
to trade receivables or cash,
we consider that recognition of
revenue is appropriate.
In the prior year, our auditor’s report included a key audit matter in relation to ‘Lucky Onion’ pubs preliminary purchase price allocation.
In the current year, this key audit matter is not included as there have been no acquisitions during the year that are significant to
the group.
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Our application of materiality
We apply the concept of materiality in planning and performing
the audit, in evaluating the effect of identified misstatements on
the audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually
or in the aggregate, could reasonably be expected to influence
the economic decisions of the users of the financial statements.
Materiality provides a basis for determining the nature and extent
of our audit procedures.
We determined materiality for the Group to be £2.2 million
(2022: £2.1 million), which is 5% (2022: 5%) of adjusted profit
before taxation. We believe that adjusted profit before taxation
(as set out in note 12) is considered to be the focus of the
group’s stakeholders.
• Profit before tax – £36.2m
Starting
basis
• Adjusting items – £9.0m
Adjustments
• Totals – £45.2m
• Materiality of £2.2m (5% of materiality basis)
Materiality
We believe that the primary area of focus of the parent
company’s stakeholders are consistent with those of the group
and despite the adjusted profit before taxation being a higher
figure, we have capped materiality at £2.2 million, in line with
the group.
Performance materiality
The application of materiality at the individual account or balance
level. It is set at an amount to reduce to an appropriately low level
the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with our
assessment of the Group’s overall control environment,
our judgement was that performance materiality was 75%
(2022: 75%) of our planning materiality, namely £1.7m
(2022: £1.6m). We have set performance materiality at this
percentage due to reflect the results of our testing of the group’s
systems and processes and historical audit findings.
Reporting threshold
An amount below which identified misstatements are considered
as being clearly trivial.
We agreed with the Audit Committee that we would report to
them all uncorrected audit differences in excess of £110,000
(2022: £105,000), which is set at 5% of planning materiality,
as well as differences below that threshold that, in our view,
warranted reporting on qualitative grounds.
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We evaluate any uncorrected misstatements against both the
quantitative measures of materiality discussed above and in
light of other relevant qualitative considerations in forming
our opinion.
Other information
The other information comprises the information included
in the annual report set out on pages 4 to 86, other than
the financial statements and our auditor’s report thereon.
The directors are responsible for the other information within
the annual report.
Our opinion on the financial statements does not cover the
other information and, except to the extent otherwise explicitly
stated in this report, we do not express any form of assurance
conclusion thereon.
Our responsibility is to read the other information and, in
doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge
obtained in the course of the audit or otherwise appears to be
materially misstated. If we identify such material inconsistencies
or apparent material misstatements, we are required to determine
whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed,
we conclude that there is a material misstatement of the other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed
by the Companies Act 2006
In our opinion, based on the work undertaken in the course
of the audit:
• the information given in the strategic report and the directors’
report for the financial year for which the financial statements
are prepared is consistent with the financial statements; and
• the strategic report and directors’ report have been prepared
in accordance with applicable legal requirements.
Matters on which we are required to
report by exception
In the light of the knowledge and understanding of the group
and the parent company and its environment obtained in the
course of the audit, we have not identified material misstatements
in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report
to you if, in our opinion:
• adequate accounting records have not been kept by the
parent company, or returns adequate for our audit have not
been received from branches not visited by us; or
• the parent company financial statements are not in agreement
with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law
are not made; or
• we have not received all the information and explanations
we require for our audit.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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Financial Statements
Independent auditor’s report continued
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement
set out on page 66, the directors are responsible for the
preparation of the financial statements and for being satisfied
that they give a true and fair view, and for such internal control
as the directors determine is necessary to enable the preparation
of financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the group and parent company’s ability
to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the
group or the parent company or to cease operations, or have
no realistic alternative but to do so.
Auditor’s responsibilities for the audit
of the financial statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or
in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these
financial statements.
Explanation as to what extent the audit
was considered capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect irregularities, including
fraud. The risk of not detecting a material misstatement due
to fraud is higher than the risk of not detecting one resulting
from error, as fraud may involve deliberate concealment by, for
example, forgery or intentional misrepresentations, or through
collusion. The extent to which our procedures are capable of
detecting irregularities, including fraud is detailed below.
However, the primary responsibility for the prevention and
detection of fraud rests with both those charged with governance
of the company and management.
• We obtained an understanding of the legal and regulatory
frameworks that are applicable to the group and determined
that the most significant are:
– Those that relate to the reporting framework: UK adopted
international accounting standards, the UK Companies Act
2006 and AIM Rules;
– Those that relate to the accrual or recognition of expenses
for taxation, such as UK Corporate tax legislation; and
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– Those that relate to the accrual for or recognition of
expenses for employee benefit costs including post-
employment benefit costs, as well as the treatment of
its employees.
• We understood how the group is complying with those
frameworks by making inquiries of management, those
charged with governance, internal audit, those responsible for
legal and compliance procedures and the company secretary.
We corroborated our inquiries through inspection of board
minutes and correspondence with regulatory authorities and
through attendance at Audit Committee meetings throughout
and subsequent to the period under audit.
• We assessed the susceptibility of the group’s financial
statements to material misstatement, including how fraud
might occur by making inquiries of management, those
charged with governance, internal audit and various
other individuals within the financial reporting function.
We corroborated these inquiries by inspecting board minutes,
internal audit reports and findings, reports to the group’s
internal whistleblowing hotline and by understanding both
the group’s bonus scheme structure and the expectations of
investors and analysts, to understand areas in which individuals
may be incentivised to commit fraud.
• Based on this understanding we designed our audit
procedures to identify non-compliance with such laws and
regulations. Our procedures involved making inquiries
as described above, inspecting minutes of all significant
board and committee meetings, reading correspondence
with regulatory authorities, testing manual journal entries
with higher risk characteristics and testing unusual or non-
standard transactions.
A further description of our responsibilities for the audit of the
financial statements is located on the Financial Reporting Council’s
website at https://www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company’s members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might
state to the company’s members those matters we are required
to state to them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the company and
the company’s members as a body, for our audit work, for this
report, or for the opinions we have formed.
Katie Dallimore-Fox (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
Reading
24 May 2023
Group income statement
For the 53 weeks ended 3 April 2023
Continuing operations
Revenue
Other income
Operating costs before adjusting items
Adjusted operating profit
Adjusting items
Operating profit
Finance income
Finance costs
Finance income/(charge) for pension obligations
Profit before tax from continuing operations
Income tax expense
Profit for the period from continuing operations
Profit for the period from discontinued operations1
Profit for the period attributable to shareholders of the parent company
1 A gain on disposal of £9.0 million was recognised in the prior period and recorded within adjusting items (see note 5).
Earnings per 12.5p ordinary share
Basic
Diluted
Earnings per 12.5p ordinary share for continuing operations
Basic
Diluted
Notes
2023
53 weeks
£m
2022
52 weeks
£m
7
10
8
11
13
27
14
5
17
17
17
17
368.9
–
(316.5)
52.4
(9.0)
43.4
0.1
(7.6)
0.3
36.2
(6.5)
29.7
–
29.7
309.0
5.0
(262.6)
51.4
0.3
51.7
–
(9.5)
(0.1)
42.1
(17.2)
24.9
9.5
34.4
Pence
Pence
50.78
50.74
50.78
50.74
58.83
58.80
42.58
42.56
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
The notes on pages 102 to 145 form part of these financial statements.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
95
Financial Statements
Group statement of comprehensive income
For the 53 weeks ended 3 April 2023
Profit for the period
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss:
Unrealised gain on revaluation of property
Remeasurement of retirement benefit schemes
Tax on above components of other comprehensive income
Items that will be reclassified subsequently to profit or loss:
Fair value movement of interest rate swaps
Tax on fair value movement of interest rate swaps
Total comprehensive income attributable to shareholders of the parent company
Total comprehensive income attributable to shareholders of the parent company from
continuing operations
Total comprehensive income attributable to shareholders of the parent company from
discontinued operations1
1 A gain on disposal of £9.0 million was recognised in the prior period and recorded within adjusting items (see note 5).
Notes
19
27
14
25
14
2023
53 weeks
£m
29.7
2022
52 weeks
£m
34.4
15.2
(10.1)
(1.2)
3.1
(0.8)
6.2
35.9
28.7
17.2
(25.3)
5.2
(1.1)
24.7
59.1
35.9
49.6
–
9.5
The notes on pages 102 to 145 form part of these financial statements.
96
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Group balance sheet
At 3 April 2023
Non-current assets
Goodwill
Property and equipment
Right-of-use assets
Derivative financial instruments
Retirement benefit schemes
Current assets
Inventories
Trade and other receivables
Income tax receivable
Derivative financial instruments
Cash
Asset held for sale
Total assets
Current liabilities
Borrowings
Lease liabilities
Income tax payable
Derivative financial instruments
Trade and other payables
Non-current liabilities
Borrowings
Lease liabilities
Derivative financial instruments
Deferred tax liabilities
Retirement benefit schemes
Total liabilities
Net assets
Capital and reserves
Share capital
Share premium
Capital redemption reserve
Hedging reserve
Revaluation reserve
Retained earnings
Total equity
Prior period comparatives have been restated (see note 2).
Approved by the board of directors and signed on its behalf by:
Simon Dodd
Chief Executive
24 May 2023
Michael Owen
Chief Financial Officer
Notes
18
19
20
25
27
22
23
25
25
28
25
24
25
28
25
26
27
29
Group
Restated
2022
£m
32.5
808.0
147.0
2.2
14.3
1,004.0
4.7
8.9
6.2
–
34.0
53.8
–
1,057.8
(30.0)
(4.9)
–
(0.3)
(43.7)
(78.9)
(103.8)
(69.1)
–
(104.2)
(2.1)
(279.2)
(358.1)
699.7
7.3
7.7
1.8
1.7
249.4
431.8
699.7
2023
£m
32.5
842.5
142.9
2.3
5.4
1,025.6
5.4
9.5
–
2.7
10.7
28.3
–
1,053.9
–
(4.8)
(0.9)
–
(46.6)
(52.3)
(104.2)
(66.9)
–
(104.6)
(1.7)
(277.4)
(329.7)
724.2
7.3
7.8
1.8
4.0
260.9
442.4
724.2
Restated
2021
£m
32.5
773.7
158.0
–
–
964.2
2.6
10.4
5.8
–
4.7
23.5
1.2
988.9
(29.8)
(4.9)
–
(1.8)
(15.8)
(52.3)
(143.4)
(75.3)
(1.4)
(65.0)
(6.1)
(291.2)
(343.5)
645.4
7.3
7.6
1.8
(2.4)
253.6
377.5
645.4
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
The notes on pages 102 to 145 form part of these financial statements.
Young & Co.’s Brewery, P.L.C. Registered in England number 32762.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
97
Financial Statements
Company balance sheet
At 3 April 2023
Non-current assets
Goodwill
Property and equipment
Right-of-use assets
Investment in subsidiaries
Derivative financial instruments
Retirement benefit schemes
Current assets
Inventories
Trade and other receivables
Income tax receivable
Derivative financial instruments
Cash
Asset held for sale
Total assets
Current liabilities
Borrowings
Lease liabilities
Income tax payable
Derivative financial instruments
Trade and other payables
Non-current liabilities
Borrowings
Lease liabilities
Derivative financial instruments
Deferred tax liabilities
Retirement benefit schemes
Total liabilities
Net assets
Capital and reserves
Share capital
Share premium
Capital redemption reserve
Hedging reserve
Revaluation reserve
Retained earnings
Total equity
Notes
18
19
20
21
25
27
22
23
25
25
28
25
24
25
28
25
26
27
29
Company
Restated
2022
£m
31.0
803.5
139.4
14.3
2.2
14.3
1,004.7
4.7
9.7
6.3
–
34.0
54.7
–
1,059.4
(30.0)
(4.1)
–
(0.3)
(55.8)
(90.2)
(103.8)
(63.6)
–
(104.0)
(2.1)
(273.5)
(363.7)
695.7
7.3
7.7
1.8
1.7
240.2
437.0
695.7
2023
£m
31.0
838.5
135.8
14.3
2.3
5.4
1,027.3
5.4
9.5
–
2.7
10.7
28.3
–
1,055.6
–
(4.0)
(0.8)
–
(56.2)
(61.0)
(104.2)
(61.9)
–
(104.4)
(1.7)
(272.2)
(333.2)
722.4
7.3
7.8
1.8
4.0
252.0
449.5
722.4
Restated
2021
£m
31.0
769.1
149.2
14.3
–
–
963.6
2.6
11.3
6.0
–
4.7
24.6
1.2
989.4
(29.8)
(4.1)
–
(1.8)
(27.5)
(63.2)
(143.4)
(69.1)
(1.4)
(64.8)
(6.1)
(284.8)
(348.0)
641.4
7.3
7.6
1.8
(2.4)
244.4
382.7
641.4
Prior period comparatives have been restated (see note 2).
The company’s profit after tax from continuing operations for the period was £31.6 million (2022: £24.9 million). The company’s profit
after tax from discontinued operations for the period was £nil (2022: £9.5 million).
Approved by the board of directors and signed on its behalf by:
Simon Dodd
Chief Executive
24 May 2023
Michael Owen
Chief Financial Officer
98
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Statements of cash flow
For the 53 weeks ended 3 April 2023
Operating activities
Net cash generated from operations
Tax paid
Net cash flows from operating activities
Investing activities
Proceeds from disposal of property and equipment1
Purchase of property and equipment
Business combinations, net of cash acquired
Net cash used in investing activities
Financing activities
Interest paid
Issued equity, net of transaction costs
Equity dividends paid
Payment of principal portion of lease liabilities
Repayment of borrowings2
Net cash flows used in financing activities
Net increase in cash
Cash at the beginning of the period
Cash at the end of the period
Notes
32
19
15
16
Group
2023
53 weeks
£m
83.8
(0.9)
82.9
6.1
(40.2)
(18.2)
(52.3)
(6.9)
0.1
(12.0)
(5.1)
(30.0)
(53.9)
(23.3)
34.0
10.7
2022
52 weeks
£m
107.0
(5.1)
101.9
59.7
(36.9)
(36.9)
(14.1)
(9.7)
0.1
(5.0)
(4.1)
(39.8)
(58.5)
29.3
4.7
34.0
Company
2023
53 weeks
£m
82.6
(0.9)
81.7
6.1
(40.2)
(18.2)
(52.3)
(6.6)
0.1
(12.0)
(4.2)
(30.0)
(52.7)
(23.3)
34.0
10.7
2022
52 weeks
£m
106.3
(5.1)
101.2
59.7
(36.9)
(36.9)
(14.1)
(9.5)
0.1
(5.0)
(3.6)
(39.8)
(57.8)
29.3
4.7
34.0
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
1 During the current period to 3 April 2023, £6.1 million related to the sale of the Bridge Hotel (Greenford). During the prior period to 28 March 2022, £53.0 million related to the sale of 56 tenanted
pubs as per note 5. The remaining balance relates to other disposals of tenanted sites.
2 During the current period to 3 April 2023 the group repaid the £30.0 million bilateral term loan with the NatWest. During the prior period to 28 March 2022 the group repaid the £30.0 million
Covid Corporate Financing Facility debt (net of £0.2 million fees) and the £10.0 million Revolving Credit Facility debt.
The notes on pages 102 to 145 form part of these financial statements.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
99
Financial Statements
Group statement of changes in equity
At 3 April 2023
At 29 March 2021
Total comprehensive income
Profit for the period
Other comprehensive income
Unrealised gain on revaluation of property
Remeasurement of retirement benefit schemes
Net movement of interest rate swaps – cash flow hedge
Tax on above components of other comprehensive
income
Total comprehensive income
Transactions with owners recorded directly in equity
Share capital issued
Dividends paid on equity shares
Revaluation reserve realised on disposal of properties
Share based payments
At 28 March 2022
Total comprehensive income
Profit for the period
Other comprehensive income
Unrealised gain on revaluation of property
Remeasurement of retirement benefit schemes
Net movement of interest rate swaps – cash flow hedge
Tax on above components of other
comprehensive income
Total comprehensive income
Transactions with owners recorded directly in equity
Share capital issued
Dividends paid on equity shares
Share based payments
At 3 April 2023
Notes
Share
capital1
£m
14.9
Capital
redemption
reserve
£m
1.8
Hedging
reserve
£m
(2.4)
Revaluation
reserve
£m
253.6
Retained
earnings
£m
377.5
Total
equity
£m
645.4
19
27
25
14
16
19
27
25
14
16
–
–
–
–
–
–
–
0.1
–
–
–
0.1
15.0
–
–
–
–
–
–
–
0.1
–
–
0.1
15.1
–
–
–
–
–
–
–
–
–
–
–
–
1.8
–
–
–
–
–
–
–
–
–
–
–
1.8
–
–
34.4
34.4
–
–
5.2
(1.1)
4.1
4.1
–
–
–
–
–
1.7
28.7
–
–
(22.8)
5.9
5.9
–
–
(10.1)
–
(10.1)
249.4
–
17.2
–
(2.5)
14.7
49.1
–
(5.0)
10.1
0.1
5.2
431.8
28.7
17.2
5.2
(26.4)
24.7
59.1
0.1
(5.0)
–
0.1
(4.8)
699.7
–
–
29.7
29.7
–
–
3.1
(0.8)
2.3
2.3
–
–
–
–
4.0
15.2
–
–
(3.7)
11.5
11.5
–
(10.1)
–
2.5
(7.6)
22.1
15.2
(10.1)
3.1
(2.0)
6.2
35.9
–
–
–
–
260.9
–
(12.0)
0.5
(11.5)
442.4
0.1
(12.0)
0.5
(11.4)
724.2
1 Total share capital comprises the nominal value of the share capital issued and fully paid of £7.3 million (2022: £7.3 million) and the share premium account of £7.8 million (2022: £7.7 million).
Share capital issued in the period comprises the nominal value of £nil million (2022: £nil million) and share premium of £0.1 million (2022: £0.1 million).
The notes on pages 102 to 145 form part of these financial statements.
100 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Parent company statement of changes in equity
At 3 April 2023
At 29 March 2021
Total comprehensive income
Profit for the period2
Other comprehensive income
Unrealised gain on revaluation of property
Remeasurement of retirement benefit schemes
Net movement of interest rate swaps – cash flow hedge
Tax on above components of other comprehensive income
Total comprehensive income
Transactions with owners recorded directly in equity
Share capital issued
Dividends paid on equity shares
Revaluation reserve realised on disposal of properties
Share based payments
At 28 March 2022
Total comprehensive income
Profit for the period2
Other comprehensive income
Unrealised gain on revaluation of property
Remeasurement of retirement benefit schemes
Net movement of interest rate swaps – cash flow hedge
Tax on above components of other comprehensive income
Total comprehensive income
Transactions with owners recorded directly in equity
Share capital issued
Dividends paid on equity shares
Share based payments
At 3 April 2023
Notes
Share
capital1
£m
14.9
Capital
redemption
reserve
£m
1.8
Hedging
reserve
£m
(2.4)
Revaluation
reserve
£m
244.4
Retained
earnings
£m
382.7
Total
equity
£m
641.4
19
27
25
14
16
19
27
25
14
16
–
–
–
–
–
–
–
0.1
–
–
–
0.1
15.0
–
–
–
–
–
–
–
0.1
–
–
0.1
15.1
–
–
–
–
–
–
–
–
–
–
–
–
1.8
–
–
–
–
–
–
–
–
–
–
–
1.8
–
–
34.4
34.4
–
–
5.2
(1.1)
4.1
4.1
–
–
–
–
–
1.7
28.7
–
–
(22.8)
5.9
5.9
–
–
(10.1)
–
(10.1)
240.2
–
17.2
–
(2.5)
14.7
49.1
–
(5.0)
10.1
0.1
5.2
437.0
28.7
17.2
5.2
(26.4)
24.7
59.1
0.1
(5.0)
–
0.1
(4.8)
695.7
–
–
31.6
31.6
–
–
3.1
(0.8)
2.3
2.3
–
–
–
–
4.0
15.5
–
–
(3.7)
11.8
11.8
–
–
–
–
252.0
–
(10.1)
–
2.5
(7.6)
24.0
–
(12.0)
0.5
(11.5)
449.5
15.5
(10.1)
3.1
(2.0)
6.5
38.1
0.1
(12.0)
0.5
(11.4)
722.4
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
1 Total share capital comprises the nominal value of the share capital issued and fully paid of £7.3 million (2022: £7.3 million) and the share premium account of £7.8 million (2022: £7.7 million).
Share capital issued in the period comprises the nominal value of £nil (2022: £nil) and share premium of £0.1 million (2022: £0.1 million).
2 The company’s profit after tax from continuing operations for the period was £31.6 million (2022: £24.9 million). The company’s profit after tax from discontinued operations was £nil
(2022: £9.5 million).
The notes on pages 102 to 145 form part of these financial statements.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
101
Financial Statements
Notes to the financial statements
For the 53 weeks ended 3 April 2023
1. General information
The group and parent company financial statements of Young & Co.’s Brewery, P.L.C. for the period ended 3 April 2023 were authorised
for issue by the board of directors on 24 May 2023. Young & Co.’s Brewery, P.L.C. is a public limited company incorporated and
domiciled in England and Wales. The company’s shares are listed on the Alternative Investment Market of the London Stock Exchange.
The nature of the group’s operations and its principal activities are set out in note 6 and in the strategic report on pages 1 to 54.
The current period and prior period relate to the 53 weeks ended 3 April 2023 and the 52 weeks ended 28 March 2022 respectively.
The financial statements are presented in pounds sterling, which is the functional currency of the parent company, and all values are
rounded to the nearest hundred thousand (£0.1 million), except where otherwise indicated.
Going concern
At 3 April 2023, the group had cash in bank of £10.7 million and committed borrowing facilities of £205.0 million, of which
£105.0 million was drawn down. The group expects, by 1 July 2024 (the ‘going concern’ period), to have available facilities of
£205.0 million, with the plan to renegotiate the £20.0 million term loan that is due May 2024. However, given that those negotiations
have yet to take place, for going concern purposes the group has assumed that available facilities will be £185.0 million at the end of
the going concern period. In addition to these committed facilities, the group has a £10.0 million overdraft with HSBC, which is not
committed, and is therefore not assumed to continue for the purpose of this assessment.
As part of the directors’ consideration of the appropriateness of adopting the going concern basis, the group has modelled a base case
and three sensitised scenarios for the going concern period. The base case is the board approved budget to March 2024 as well as
the board approved strategic plan covering April to June 2024. The key judgements applied are the extent of any influence on trade
because of the economic downturn and its impact on consumers, and the inflationary cost pressures that the hospitality industry is
continuing to face.
The base case model assumes the group continues to trade as now whilst reflecting the inflationary environment that currently exists
across the going concern period. The general reduction in trade scenario looks at a decline of 20% in sales and 25% in profit across
the period. This aims to capture the potential slowdown in consumer spending influenced by the ongoing cost of living crisis. The cost
inflation scenario includes an average 8% increase in the food cost base and 10% increase in general pub operating costs for the period
with no retail price increases. Utility pricing has been held at the base case rates, given the group has forward bought utilities to March
2024. The group has assumed capital expenditure levels will continue at historical levels and no structural changes to the business will
be needed in any of the scenarios modelled.
In the base case, general reduction in trade, and cost inflation scenarios there continues to be significant headroom on the group’s debt
facilities, and all banking covenants are fully complied with throughout the going concern period.
The reverse stress test focused on the decline in sales and profit that the group would be able to absorb before breaching any financial
covenants or indeed any liquidity issues (the former being the main stress point given the debt headroom). Consequentially there
would need to be a sales reduction of c.40% and profit reduction of c.60% between April 2023 and 2024 compared to the base
case, a reduction far in excess of those experienced historically (with the exception of the restricted covid-19 period), before there is a
breach of financial covenants in the period and is calculated before reflecting any mitigating actions such as reduced capital expenditure.
The directors believe the scenario to be remote.
The group has also considered the impact of climate change on going concern and has determined that there is no impact on the
business during the going concern period. Aligned with the group’s developing ESG strategy this will continue to feature in future
assessments, as the group determines the potential wider impact on the asset base, capex spend and cost of compliance.
Based on these forecasts and sensitivities, coupled with the current debt levels and the ongoing debt structure in place, the board is
confident that the group is able to manage its business risks and therefore continue in operational existence for the foreseeable future.
For this reason, the group continues to adopt the going concern basis in preparing its financial statements.
2. Basis of preparation
The consolidated financial statements, and the company financial statements, have been prepared in accordance with UK-adopted
international accounting standards and, as regards the parent company financial statements, as applied in accordance with the provisions
of the Companies Act 2006. The company has taken advantage of section 408 of the Companies Act 2006 not to present the parent
company profit and loss account.
IFRS, as applicable in the UK, includes the application of International Financial Reporting Standards including International Accounting
Standards (IAS) and related Interpretations of the International Financial Reporting Interpretations Committee (IFRIC) and Interpretations
of the Standing Interpretations Committee (SIC). During the period, new IFRS and amendments to existing IFRS were issued by the
International Accounting Standards Board (IASB). The impact and, if applicable, the adoption of these standards is described below in
‘New Accounting Standards, Amendments and Interpretations’.
102 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
No separate income statement or statement of comprehensive income are presented for the company, as permitted by section 408(3)
of the Companies Act 2006.
In preparing the group financial statements, management have considered the impact of climate change, taking into account the
relevant disclosures in the strategic report. This included a review of both physical climate risks and transitional climate risks, taking into
regard recommendations issued by the Taskforce on Climate-related Financial Disclosures. In particular, assets with indefinite or long
lives were assessed for impairment by taking into account global warming. No issues were identified that would impact such assets
carrying values or have a material impact on the financial statements and is not expected to have a significant impact on the group’s
going concern assessment to May 2023, nor the next five years.
Restatement of prior periods
In accordance with the requirements of IAS 1 Presentation of Financial Statements and IAS 12 Income Taxes, management have
restated the deferred tax assets as at 28 March 2022 and 29 March 2021 to be presented net against the deferred tax liabilities.
The impact on the group balance sheet at 28 March 2022 is a reduction in the deferred tax asset of £4.1 million to £nil and a
decrease in the deferred tax liability of £4.1 million to £104.2 million. This reduces the non-current asset subtotal by £4.1 million to
£1,004.0 million and the non-current liability subtotal by £4.1 million to £279.2 million. The total assets are reduced by £4.1 million to
£1,057.8 million and the total liabilities are reduced by £4.1 million to £358.1 million.
The impact on the group balance sheet at 29 March 2021 is a reduction in the deferred tax asset of £8.6 million to £nil and a decrease
in the deferred tax liability of £8.6 million to £65.0 million. This reduces the non-current asset subtotal by £8.6 million to £964.2 million
and the non-current liability subtotal by £8.6 million to £291.2 million. The total assets are reduced by £8.6 million to £988.9 million
and the total liabilities are reduced by £8.6 million to £343.5 million. The overall impact on net assets in both prior periods is £nil.
There is no impact to the income statement or cash flow statement in either prior period as a result of this adjustment.
The impact on the company balance sheet at 28 March 2022 is a reduction in the deferred tax asset of £4.1 million to £nil and a
decrease in the deferred tax liability of £4.1 million to £104.0 million. This reduces the non-current asset subtotal by £4.1 million to
£1,004.7 million and the non-current liability subtotal by £4.1 million to £273.5 million. The total assets are reduced by £4.1 million to
£1,059.4 million and the total liabilities are reduced by £4.1 million to £363.7 million.
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The impact on the company balance sheet at 29 March 2021 is a reduction in the deferred tax asset of £8.6 million to £nil million
and a decrease in the deferred tax liability of £8.6 million to £64.8 million. This reduces the non-current asset subtotal by £8.6 million
to £963.6 million and the non-current liability subtotal by £8.6 million to £284.8 million. The total assets are reduced by £8.6 million
to £989.4 million and the total liabilities are reduced by £8.6 million to £348.0 million. The overall impact on net assets in both prior
periods is £nil. There is no impact to the income statement or cash flow statement in either prior period as a result of this adjustment.
New Accounting Standards, Amendments, Interpretations and New Accounting Policies
The group applied for the first time certain standards and amendments. Property, Plant and Equipment: Proceeds before Intended
Use, Onerous Contracts: Costs of Fulfilling a Contract, and the amendments to Business Combinations – Reference to the Conceptual
Framework are new amendments which are effective in the current period. The group has not early adopted any other standard,
interpretation or amendment that has been issued but is not yet effective.
Amendments to IAS 16 – Property, Plant and Equipment: Proceeds before Intended Use
The amendment prohibits companies from deducting from the cost of an item of property, plant, and equipment any proceeds of the
sale of items produced while bringing that asset to the location and condition necessary for it to be capable of operating in the manner
intended by management. Instead, the proceeds from selling such items should be recognized in profit or loss.
The group will apply the amendments retrospectively only to items of property and equipment made available for use on or after the
beginning of the current reporting period, being the period in which the group has first applied the amendment.
The amendment had no impact on the consolidated financial statements of the group as there were no sales of such items produced by
property and equipment made available for use on or after the beginning of the current reporting period.
Amendments to IAS 37 – Onerous Contracts: Cost of Fulfilling a Contract
An onerous contract is a contract under which the unavoidable costs of meeting the obligations under the contract (i.e. the costs that the
group cannot avoid because it has the contract) exceed the economic benefits expected to be received under it.
The amendments specify that when assessing whether a contract is onerous or loss-making, a company needs to include costs
that relate directly to a contract to provide goods or services. This includes incremental costs, in line with the previous requirements
of the standard, and as a result of the amendments this also includes an allocation of costs directly related to contract activities.
Administrative costs do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under
the contract.
The amendment had no impact on the consolidated financial statements of the group as there were no onerous contracts identified on
or after the beginning of the current reporting period.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
103
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
2. Basis of preparation continued
Amendments to IFRS 3 – Reference to the Conceptual Framework
The amendments add an exception to the recognition principle of IFRS 3 Business Combinations to avoid the issue of potential ‘day 2’
gains or losses arising for liabilities and contingent liabilities that would be within the scope of IAS 37 Provisions, Contingent Liabilities
and Contingent Assets or IFRIC 21 Levies, if incurred separately. The exception requires companies to apply the criteria in IAS 37 or
IFRIC 21 respectively, instead of the Conceptual Framework, to determine whether a present obligation exists at the acquisition date.
The amendments also add a new paragraph to IFRS 3 to clarify that contingent assets do not qualify for recognition at the
acquisition date.
The group applied the amendments to business combinations occurring after the beginning of the current reporting period, being the
period in which the group has first applied the amendment. These amendments had no impact on the consolidated financial statements
of the group as there were no contingent assets, liabilities, or contingent liabilities within the scope of these amendments that arose
during the period.
Other standards
The group will adopt the following Standards, Amendments and Interpretations listed below in the first full financial period following
their effective date. The group does not expect that adoption in future periods will have a material impact:
New Standard
Amendments to IAS 8
Amendments to IAS 12
Amendment
Definition of Accounting Estimates
Deferred Tax related to Assets and Liabilities arising
from a Single Transaction
Effective date
1 January 2023
1 January 2023
3. Summary of significant accounting policies
The significant accounting policies adopted are set out below and have been applied consistently in presenting the group and parent
company financial information.
(a) Basis of consolidation
The group’s financial statements consolidate the financial statements of Young & Co.’s Brewery, P.L.C. with the entities it controls, its
subsidiaries and a special purpose entity, drawn up to the period end. An investor controls an investee when it is exposed, or has rights,
to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
The special purpose entity is the Ram Brewery Trust II; the trust holds assets for the benefit of employees and former employees, is an
ESOP trust and is consolidated in the group and treated as an extension of the company in the parent company accounts.
The results of subsidiaries acquired or disposed of during the period are included in the group income statement from the effective date
of acquisition or up to the effective date of disposal, as appropriate.
The financial statements of the subsidiaries and special purpose entity are consolidated on a comparable period basis, using consistent
accounting policies. All inter-company balances and transactions, including unrealised profits arising on them, are eliminated.
(b) The parent company’s investments in subsidiaries
In its separate financial statements, the parent company recognises its investments in its subsidiaries on the basis of cost less provision
for impairment. Income is recognised from these investments in relation to distributions received.
(c) Revenue recognition
Revenue is measured at the transaction price when control passes to the customer in respect of goods and services provided,
net of discounts and VAT. The recognition of revenue under each of the group’s material revenue streams is as follows:
Sale of goods
Revenue is recognised at a point in time when control of the goods or services is transferred to the customer.
Accommodation sales
Revenue is recognised on a straight-line basis over the duration of the room occupation.
Rental income
Rental income arising from operating leases on properties is accounted for on a straight-line basis over the lease term. Rental income
does not fall within the scope of IFRS 15.
104 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
(d) Adjusting items
Adjusting items are separately disclosed in order to draw them to the attention of the reader of the financial statements. This is due
either to their material and non-recurring nature or that, in management’s judgement, they are required to be disclosed separately
in order to present the underlying business performance, being an internal measure the directors use to evaluate the operational
performance of the group in a consistent manner and to reflect how the business is managed and measured on a day-to-day basis.
The tax treatment for adjusting items is consistent with tax treatment for non-adjusting items.
(e) Business combinations and goodwill
Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the
consideration transferred and the amount of any non-controlling interest in the acquiree. The consideration transferred is measured
at the acquisition date fair value. The non-controlling interest is measured as the proportionate share of the acquiree’s identifiable net
assets. Acquisition costs incurred are expensed and included in operating adjusting items.
Goodwill arising on acquisition represents the excess of the cost of acquisition over the fair value of the net identifiable assets acquired
and liabilities assumed at the date of acquisition. On disposal of a subsidiary, the attributable amount of goodwill is included in the
determination of the profit or loss on disposal.
(f) Property and equipment
Freehold properties, including land and buildings, fixtures, fittings and equipment are held at fair value and are revalued by qualified
valuers on a sufficiently regular basis using open market values so that the carrying value of an asset does not differ significantly from
its fair value at the balance sheet date. The valuation is assessed on the basis of the highest and best use.
Surpluses which arise from the revaluation exercise are included within other comprehensive income (in the revaluation reserve) unless
they are reversing a revaluation adjustment which has been recognised in the income statement previously. Where the revaluation
exercise gives rise to a deficit, this is reflected directly in other comprehensive income (in the revaluation reserve) to the extent that
a surplus exists against the same asset. Any further decrease in value is recognised in the income statement as an adjusting expense.
At the date of revaluation, any accumulated depreciation is eliminated to the extent of the difference between the revalued amount
and the carrying value of the asset immediately before valuation.
Leasehold improvements and fixtures, fittings and equipment within those sites are measured at cost on recognition, and are stated
as such less any accumulated depreciation.
The carrying amount of an asset, less any residual value, is depreciated on a straight-line basis over the asset’s useful life or lease term,
if shorter. The residual value, useful life and depreciation method applied to each asset are reviewed annually. The group does not
depreciate freehold land or the residual value of its freehold buildings.
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Useful lives:
Freehold buildings
Leasehold improvements
Fixtures, fittings and equipment
50 years
Shorter of the estimated useful life and the lease term
3-10 years
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount (note 3(h)).
The gain arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying
amount of the asset, and is recognised in the income statement. Property and equipment are treated as disposals in the period of their
write-down.
(g) Asset held for sale and discontinued operations
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through
a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower
of their carrying amount and fair value less costs to sell.
An impairment loss is recognised for any initial or subsequent write-down of the asset to fair value less costs to sell. A gain is recognised
for any subsequent increases in fair value less costs to sell of an asset, but not in excess of any cumulative impairment loss previously
recognised. A gain or loss not previously recognised by the date of the sale of the non-current asset is recognised at the date
of derecognition.
Non-current assets are not depreciated or amortised while they are classified as held for sale. Assets and liabilities classified as held
for sale are presented separately as current items in the statement of financial position.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
105
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
3. Summary of significant accounting policies continued
Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss
after tax from discontinued operations in the income statement.
Additional disclosures relating to discontinued operations are provided in note 5. All other notes to the financial statements include
amounts for continuing operations, unless indicated otherwise.
(h) Impairment of assets
The carrying values of investments, property and equipment and right-of-use assets are reviewed for impairment if events or changes
in circumstances indicate the carrying value may not be recoverable. Goodwill is mandatorily assessed for impairment on an annual
basis or more frequently if there are indications that the carrying value may be impaired.
Impairment is assessed on the basis of either each individual asset or each individual cash generating unit (an individual pub), or, in the
case of goodwill, the group of cash generating units associated with it. For the purpose of impairment testing, goodwill acquired in a
business combination is, from the acquisition date, allocated to each of the group’s cash generating units (or groups of cash generating
units) that are expected to benefit from the combination.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less cost of disposal and the value in use, and is determined for an individual asset unless
the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Value in use is
assessed by reference to the estimated future cash flows which are discounted to present value using an appropriate pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. The value in use calculations
are based on the most recent budget and forecast calculations, which are prepared separately for each CGU to which the individual
assets are allocated. The value in use calculations generally cover a period of five years, after which a long-term growth rate is applied
to project future cash flows.
The impact of climate change has been considered as part of the impairment assessment, including both physical and transitional
risks. Due to the nature of the group’s operations, climate risk is not considered to have a material impact on any CGU’s value in use
calculation and is therefore not expected to result in any impairment.
Impairment losses are recognised in the income statement. Where an impairment loss subsequently reverses, the carrying amount of
the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the
carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods. A reversal
of an impairment loss is recognised immediately in the group income statement unless the impairment loss relates to goodwill, in which
case it is not reversed.
(i) Right-of-use assets
The group recognises right-of-use assets at the commencement date of a new lease. Right-of-use assets are measured at cost, less any
accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of a right-of-use asset
includes the amount of lease liabilities recognised, initial direct costs incurred, including lease premiums to take on a lease, and lease
payments made at or before the commencement date less any lease incentives received, unless the group is reasonably certain to obtain
ownership of the leased asset at the end of the lease term, the recognised right-of-use asset is depreciated on a straight-line basis over
the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to the group’s accounting policy for impairment.
(j) Leases
At inception of a contract, the group considers whether the contract is, or contains, a lease. A contract is, or contains a lease if the
contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
(1) Where the group is the lessee
At the commencement date of a new lease, the group recognises a lease liability measured at the present value of lease payments to
be made over the lease term. The lease payments include fixed payments less any lease incentives receivable, variable lease payments
that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also
include payments of penalties for terminating a lease or payments for exercising an extension option, if the lease term reflects the
group exercising the option to terminate or extend the lease. The variable lease payments that do not depend on an index or a rate
are recognised as an expense in the period on which the event or condition that triggers the payment occurs.
106 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
In calculating the present value of lease payments, the group uses the incremental borrowing rate at the lease commencement date
if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease
liabilities is remeasured if there is a change in the amounts expected to be payable under a residual value guarantee, a change in
variable lease payments based on an index or a rate, a modification that is not accounted for as a separate lease, a change in the lease
term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset.
The group has taken the recognition exemption for short-term leases and low-value leases. Expenses from such leases have been
recognised in the income statement on a straight-line basis over the lease term.
The group has applied the practical expedient available in assessing whether covid-related rent concessions were a lease modification.
(2) Where the group is the lessor
Assets leased out under operating leases are included within property and equipment and are depreciated over their estimated useful
lives. Rental income, including the effect of lease incentives, is recognised on a straight-line basis over the lease term. As a result of
covid-19, various rent concessions have been granted to lessees. Rent concessions granted to tenants are treated as variable rent
payments, under which the variable element of rent is taken directly to the profit and loss statement in the period that it relates to.
(k) Inventories
Inventories are valued at the lower of cost and net realisable value. Cost includes all costs of purchase, costs of conversion and other
costs incurred in bringing the inventories to their present location and condition. The cost formula used is equivalent to a ‘first in, first
out’ method.
(l) Cash
Cash in the balance sheet comprises cash at banks, cash in transit due from credit card providers and cash in hand. For the purpose
of the group and parent company cash flow statements, cash is net of outstanding bank overdrafts. Cash and cash equivalents include
deposits held at call with financial institutions with original maturities of three months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
(m) Trade and other payables
Trade and other payables are recognised initially at fair value and subsequently at amortised cost. When applicable, trade and other
payables are analysed between current and non-current liabilities on the face of the balance sheet, depending on when the obligation
to settle will crystallise.
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(n) Interest bearing loans and borrowings
All loans and borrowings are recognised initially at fair value. Directly attributable transaction costs are capitalised and amortised over
the life of the facility using the effective interest method through finance expense.
After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective
interest method.
Expected credit losses are recognised from initial recognition based on the group’s historical credit loss experience, factors specific for
each loan, the current economic climate and expected changes in forecasts of future events. Changes in expected credit losses are
recognised in the income statement.
(o) Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
The current tax payable is based on taxable profit for the period. Taxable profit differs from profit before tax as reported in the income
statement because the former excludes items of income or expense that are taxable or deductible in other years and also excludes
items that are never taxable or deductible. The group’s liability for current tax is calculated using UK tax rates that have been enacted
under UK law and that are applicable to the period.
The current tax expense is recognised in the income statement unless it relates to items that are credited or charged to equity,
in which case it is credited or charged directly to equity.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
107
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
3. Summary of significant accounting policies continued
Deferred tax is recognised on all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts,
with the following exceptions:
• where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not
a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;
• in respect of taxable temporary differences associated with investments in subsidiaries, where the timing of the reversal of the
temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable
future; and
• deferred income tax assets are recognised only to the extent that it is probable that taxable profits will be available against which
the deductible temporary differences, carried forward tax credits or tax losses can be utilised.
Deferred tax relating to items recognised outside the profit and loss is recognised either in other comprehensive income or directly
in equity. Deferred tax on those items is recognised consistently with the underlying transaction.
Where capital gains have been rolled over for tax purposes, a deferred tax liability is recorded on the rolled over gain to reflect the tax
that may be due on this amount at a future date.
Where there has been an upward revaluation of an asset and the asset is expected to be realised through disposal, a deferred tax
liability is recorded based on the difference between the indexed cost of the asset less any capital gains which have been rolled over
against the asset and the revalued amount.
Deferred tax is measured on an undiscounted basis at the UK tax rates that are expected to apply on reversal of the underlying
temporary differences, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
The group offsets deferred tax assets and deferred tax liabilities if, and only if, it has a legally enforceable right to set off deferred tax
assets and deferred tax liabilities relating to income taxes levied by the same taxation authority on either the same taxable entity or
on different taxable entities which intend to realise the assets and settle the liabilities simultaneously, in each future period in which
significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.
(p) Derivative financial instruments and hedging
The group uses derivative financial instruments such as interest rate swaps to hedge its risk associated with interest rate fluctuations.
Derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are
subsequently remeasured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the fair
value is negative.
The fair value of interest rate swap contracts is determined by reference to market values for similar instruments.
For those derivatives designated as hedges and for which hedge accounting is desired, the hedging relationship is documented at its
inception. This documentation identifies the hedging instrument, the hedged item or transaction, the nature of the risk being hedged
and how its effectiveness will be measured throughout its duration. Such hedges are expected at inception to be highly effective.
Where cash flow hedge accounting is not applied, the movement in the fair value of the derivative is recognised immediately in the
income statement. Where cash flow hedge accounting is applied, as in the case of the interest rate swaps held by the group, the
effective portion of the gain or loss on the hedging instrument is recognised in the statement of comprehensive income, while the
ineffective portion is recognised in the income statement.
If the hedging instrument expires or is sold, terminated or exercised without replacement or rollover, or if its designation as a hedge
is revoked, amounts previously recognised in equity remain in equity until the forecast transaction occurs, at which point they are
immediately expensed. If the related transaction is not expected to occur, the amount held in equity is immediately expensed.
In the current period, there has been a reform to update the benchmark interest rates across both borrowings and derivatives from
LIBOR to SONIA. The group has taken advantage of practical expedients available for the transition period as discussed in note 2.
(q) Pensions and other post-retirement benefits
The company operates one defined benefit pension scheme, namely the Young & Co.’s Brewery, P.L.C. Pension Scheme, a defined
contribution pension scheme and a post-retirement health care scheme.
Contributions to the defined contribution scheme are recognised in the income statement in the period in which they become due.
108 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
For the defined benefit scheme, the actuarial cost charged to the income statement in the period consists of the current service cost,
net interest on the net defined benefit liability or asset, past service cost and the impact of any settlements or curtailments.
Remeasurements of the defined benefit pension and post-retirement health care schemes are recognised in full in the statement of
comprehensive income in the period in which they relate.
The net defined benefit pension liability or asset in the balance sheet comprises the present value of the defined benefit obligations less
the fair value of scheme assets out of which the obligations are to be settled directly. Fair value is based on market price information and
in the case of quoted securities is the published bid price. The value of a net pension benefit asset is restricted to the sum of the present
value of any amount the group expects to recover by way of refunds from the scheme or reductions in the future contributions.
Post-retirement health care benefits are provided for certain employees and certain directors. Entry to the scheme is on a discretionary
basis. The annual premium for providing cover is determined by BUPA. This information is taken by qualified actuaries who then assess
the reserve required to provide this benefit for participants’ future lifetimes, using IAS 19 assumptions. The liability for new entrants is
recognised through the income statement in the period in which the benefit is granted. Remeasurements of health care benefits are
recognised in full directly in the statement of comprehensive income.
(r) Trade and other receivables
Trade receivables are initially recognised at the transaction price less impairment as they do not contain a significant financial
component. In measuring and recognising the impairment, the group has applied the simplified approach to expected credit losses.
Expected credit losses are recognised from initial recognition based on the group’s historical credit loss experience, factors specific for
each receivable, the current economic climate and expected changes in forecasts of future events. Changes in expected credit losses
are recognised in the income statement.
(s) Share based payments
The group operates three types of share based payment arrangements: a director/senior management employee deferred bonus
scheme (‘DAB’), a long-term incentive plan (‘LTIP’), and a Save-As-You-Earn (‘SAYE’) scheme.
Under the DAB, directors and senior management were encouraged to receive bonus payments in the form of shares instead of cash.
They were encouraged to do this by being offered ‘matching’ shares (see note 30). The ‘matching’ shares constituted shares with non-
market performance based vesting conditions over three years. The group has used the ‘grant date model’ as its valuation model for
recording the fair value of these equity instruments at the date when they were originally granted. The fair value of equity represents the
market value of the shares at grant date, less the nominal value which the employees will pay. It is not intended that any further awards
will be made under the DAB scheme as the LTIP has now replaced the DAB scheme.
The LTIP has been implemented during the period to incentivise and retain executive directors and senior management. The selected
employees are awarded shares which then vest at a later date, subject to the achievement of specified performance or other conditions
determined by the remuneration committee at the time of grant, with the performance conditions satisfied over a specified performance
period (see note 30). The group has used the ‘Monte Carlo’ model as its valuation model for recording the fair value of the shares
awarded at the date when they were originally granted, further details of which are given in note 30.
The LTIP expense is recognised within employment costs, together with a corresponding increase to equity, over the period in which the
service and the performance related conditions are satisfied. The cumulative expense recognised at each reporting date until the awards vest
reflects the extent to which the vesting period has expired and the group’s best estimate of the number of awards that will ultimately vest.
Under the SAYE scheme, eligible employees are encouraged to save over a set period and then, if they choose, purchase shares at
the price set before the start of that period (see note 30). The group uses the ‘Black-Scholes model’ as its valuation model for valuing
awards at fair value.
The fair value cost of the schemes is expensed to the income statement with a corresponding credit in equity on a straight-line basis over
the vesting period. The cumulative expense also takes account of the group’s estimate of the number of shares that will ultimately vest.
(t) Use of estimates
The preparation of financial information in conformity with IFRS requires management to make certain judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Although these
estimates are based on management’s best knowledge of the amount, event or actions, actual results ultimately may differ from those
estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised and in any future period affected.
The areas involving a higher degree of judgement or complexity, or where the most sensitive estimates and assumptions are significant
to the financial statements, are set out in note 4.
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
109
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
3. Summary of significant accounting policies continued
(u) Supplier income
The group earns supplier income through purchase volume-related discounts and stocking incentives. Most of the supplier income
received relates to volume discounts and is driven by the number of units purchased from suppliers. The volume discounts relate to
adjustments to a gross purchase price, and as such are recognised on an accrual basis at the point of purchase. Stocking incentives
are earned through a fixed payment in return for fulfilling certain stocking obligations, including number of stockists. Supplier income
is recognised when the group has met all obligations conditional for earning the income and it is recognised as a credit within cost
of sales.
Outstanding amounts due from suppliers for earned income at the period end are recognised within trade receivables, except in cases
where the group has rights of set-off and intends to offset these against trade payables to suppliers.
(v) Government grants and assistance
In the prior period, government grants represented monetary resources transferred to the group by the Government, government
agencies or similar bodies. They were recognised at fair value when the group had reasonable assurance that it would comply with any
conditions attached to the grant, and that the grant would be received. Government grants were recognised in the income statement,
on a systematic basis, over the same period that the expenses for which the grant was intended to compensate were recognised.
Government assistance received in the prior period represented monetary and non-monetary resources received from government
agencies or similar bodies. Where monetary assistance was received, the benefit was recorded against the associated expense at the
time the assistance was received. See note 10.
Government grants
Coronavirus Job Retention Scheme (‘CJRS’)
Under this scheme, HMRC reimbursed up to 80% of the wages of certain employees who were furloughed up to a maximum of
£2,500 per employee per month. The scheme was designed to compensate for staff costs, so amounts received were recognised in
the income statement over the same period as the costs to which they relate. The CJRS scheme was utilised in the prior period, with
amounts received recognised within operating costs in the income statement.
Government grant income
In the prior period, the business received support from local restriction support grants administered by local councils in response to the
various restrictions placed on trading between November 2020 and March 2022. This included Restart Grants available from April
2021 and Omicron Hospitality & Leisure Grants in December 2021. Income relating to the various grants was recognised in other
income in the prior period income statement.
Government assistance
Business rates relief
In the prior period, the business rates exemption which was in place for the 2020 to 2021 tax year was extended to 30 June 2021.
This was then followed by 66% business rates relief for the period 1 July 2021 to 31 March 2022, capped at £2.0 million.
4. Key accounting estimates and judgements
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the
reported amounts of assets, liabilities, income and expenses.
In applying the group’s accounting policies, the following estimates are considered to carry the most significant risk of resulting
in a material adjustment to the reported amount in the next financial year if the actual outcome differs from these estimates:
(1) Valuation of property and equipment
The group is required to value property and equipment on a sufficiently regular basis using open market values to ensure the
current carrying value does not differ significantly from the fair value. The valuation, performed by qualified valuers, is based on
market observations and estimates on the selling price in an arm’s length transaction, and includes estimates of future income levels
and trading potential for each pub, as well as taking into account other factors such as location, tenure and current income levels.
See notes 15 and 19.
(2) Carrying value of goodwill
The group considers annually whether goodwill has suffered any impairment in accordance with the accounting policy set out in note
3(h). The recoverable amounts for cash generating units have been determined based on value in use calculations. This calculation
requires the use of estimates, including growth rates, capital maintenance expenditure, climate change assumptions and pre-tax
discount rates. See notes 3(h) and 18.
110 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
(3) Defined benefit pension and health care scheme obligations
Measurement of defined benefit pension and health care scheme obligations requires an estimate of future changes in salaries
and inflation, as well as mortality rates, the expected return on assets and the selection of a suitable discount rate. These have been
determined on advice from an independent qualified actuary. See notes 3(r) and 27.
The critical judgements considered to carry the most significant risk of a material adjustment to the reported amount if the actual
outcome differs from these judgements are as follows:
(4) Business combinations
When assets are acquired, management determines whether the assets form a business combination. Business combinations must
involve the acquisition of a business, which generally have three elements: inputs, process, and output.
A fair value exercise of both the consideration paid and the net assets acquired is performed once it is determined that a business
combination has taken place. If the fair value of the consideration is in excess of the fair value of the net assets acquired, the difference
is recognised as goodwill. If the opposite occurs, the difference is recognised in the income statement. The group makes judgements
in relation to the fair value of the consideration, the net assets acquired and whether the purchase represents a business combination.
The consideration paid for the business combinations acquired during the period was solely cash. See notes 3(e), 15, 18 and 19.
(5) Taxation
The group reviews potential tax liabilities and benefits to assess the appropriate accounting treatment. Tax provisions are made if it is
probable that a tax authority will not accept a tax treatment in a previously filed or future tax return. Tax benefits are not recognised
unless it is probable that they will be recovered. The group exercises judgements in the recognition of deferred tax liabilities, including
assumptions for group’s intended use of the freehold pubs, being a sale, in-use or dual basis. Calculating the group’s tax provisions
requires judgements to be made based on past experience and the current tax environment. See notes 3(o), 14 and 26.
(6) Leases
IFRS 16 defines the lease term as the non-cancellable period of a lease together with the options to extend or terminate a lease,
if the lessee were reasonably certain to exercise that option. Where a lease includes the option for the group to terminate the lease
term, the group makes a judgement as to whether it is reasonably certain that the option will be taken. This will take into account the
length of time remaining before the option is exercisable, current trading, future trading forecasts as to the ongoing profitability of the
asset and the level and type of planned future capital investment. The group has reviewed long leaseholds and made a judgement to
classify these as right-of-use assets on the basis that none of the leases convey a right or option to purchase at the lease end date and
hence control of the building would never pass to the group, only the right to use it. See note 28.
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5. Discontinued operations
During the prior period, on 2 July 2021, the board made the decision to sell most of its tenanted estate, the Ram Pub Company.
At this date, 56 of the 63 pubs in Ram Pub Company were classified as a disposal group held for sale and as a discontinued operation.
On 9 August 2021, the sites were disposed of for a total consideration of £53.0 million. The sale was consistent with the group’s
strategy to increase value for shareholders through focussing solely on operating premium, individual, differentiated and predominantly
freehold managed pubs and hotels.
Total revenue generated from the Ram Pub Company in the prior period was £3.6 million, of which £1.0 million related to continuing
operations and the remaining £2.6 million related to discontinued operations. The results from discontinued operations for the period
are presented below:
Revenue from sales of goods
Rental income
Total revenue
Operating costs
Adjusted operating profit
Adjusting items1
Profit before tax from discontinued operations
Income tax expense
Profit after tax from discontinued operations
2023
53 weeks
£m
–
–
–
–
–
–
–
–
–
2022
52 weeks
£m
2.1
0.5
2.6
(1.8)
0.8
9.0
9.8
(0.3)
9.5
1 In the prior period, adjusting items related to the difference between cash less disposal costs received from the sale of the 56 pubs and the carrying value of their assets at the date of disposal.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
111
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
5. Discontinued operations continued
The major class of asset disposed of as part of the discontinued operation was property and equipment with a fair value of £43.4 million.
Deferred tax liabilities of £1.5 million were also de-recognised. No other assets or liabilities were disposed of as part of the disposal group.
A realised property gain in the revaluation reserve of £8.9 million was transferred to retained earnings on disposal.
The net cash flows incurred in respect of the discontinued operations were as follows:
Operating
Investing
Financing
Net cash inflow
2023
53 weeks
£m
–
–
–
–
2022
52 weeks
£m
0.1
52.5
(0.1)
52.5
For basic, diluted and the effect of adjusting items on earnings per share on discontinued operations see note 17(d).
For tax charged on discontinued operations see note 14.
6. Segmental reporting
The group historically had two operating segments: managed houses and tenanted houses. The managed house segment operates
pubs. Revenue is derived from sales of drink, food and accommodation. The tenanted house segment consisted of pubs owned or
leased by the company and leased or subleased to third parties. Revenue was derived from rents payable by, and sales of drink made
to, tenants. Unallocated related to head office income and costs, and unlicensed properties. During the prior period, most of the pubs
within the tenanted house segment were disposed of and classified as a discontinued operation.
Since the disposal of the majority of the tenanted house segment, in line with the requirements of IFRS 8 Operating Segments, the
group is organised into one reporting segment, that of operating managed houses. This is in line with the internal reporting to the
executive board of the group for the purpose of deciding on the allocation of resources and assessing performance. On this basis, the
group now reports on one operating segment, with the remaining tenanted houses grouped together with the unallocated segment
and reported as ‘all other segments’. In line with this approach, prior period comparatives for tenanted houses and unallocated have
been grouped together under ‘all other segments’.
Total segment revenue is derived externally with no intersegment revenues between the segments in the prior period. The group’s
revenue is derived entirely from the UK.
Income statement
2023
Drink sales
Food sales
Accommodation sales
Total revenue from contracts with customers from continuing operations
Other income
Total revenue recognised from continuing operations
Adjusted operating profit/(loss) from continuing operations
Adjusting items
Operating profit/(loss) from continuing operations
Managed
houses
53 weeks
£m
229.1
115.5
21.9
366.5
1.5
368.0
73.3
(8.5)
64.8
All other
segments
53 weeks
£m
0.3
–
–
0.3
0.6
0.9
(20.9)
(0.5)
(21.4)
Total
53 weeks
£m
229.4
115.5
21.9
366.8
2.1
368.9
52.4
(9.0)
43.4
112 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
2022
Drink sales
Food sales
Accommodation sales
Total revenue from contracts with customers from continuing operations
Other income
Total revenue recognised from continuing operations
Adjusted operating profit/(loss) from continuing operations
Adjusting items
Operating profit/(loss) from continuing operations
Managed
houses
52 weeks
£m
188.5
105.9
12.3
306.7
1.0
307.7
72.1
(0.4)
71.7
All other
segments
52 weeks
£m
0.5
–
–
0.5
0.8
1.3
(20.7)
0.7
(20.0)
Total
52 weeks
£m
189.0
105.9
12.3
307.2
1.8
309.0
51.4
0.3
51.7
£0.6 million of total revenue (2022: £1.0 million) was related to tenanted houses. £0.4 million of operating profit (2022: £2.6 million)
was related to tenanted houses. £0.2 million of all other segments rental income (2022: £0.3 million) was rental income derived from
unlicensed properties.
The following is a reconciliation of the operating profit to the profit before tax for continuing operations:
Operating profit from continuing operations
Finance income
Finance costs
Finance charge for pension obligations
Profit before tax from continuing operations
Balance sheet
2023
Segment assets
Cash
Total assets from continuing operations
Other segmental information from continuing operations
Depreciation of property, equipment and right-of-use assets (note 19, note 20)
Additions to non-current assets1
Net movements in property valuation through income statement (note 11, note 19)
Restated 2022
Segment assets
Cash
Total assets from continuing operations
Other segmental information from continuing operations
Depreciation of property, equipment and right-of-use assets (note 19, note 20)
Additions to non-current assets1
Net movements in property valuation through income statement (note 11, note 19)
1 Non-current assets for this purpose consist of property and equipment, right-of-use assets and intangible assets.
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2023
53 weeks
£m
43.4
0.1
(7.6)
0.3
36.2
All other
segments
£m
32.0
10.7
42.7
(1.2)
1.5
(0.2)
All other
segments
£m
48.0
34.0
82.0
(0.9)
5.4
(1.5)
2022
52 weeks
£m
51.7
–
(9.5)
(0.1)
42.1
Total
£m
1,043.2
10.7
1,053.9
(33.1)
58.8
(7.0)
Total
£m
1,023.8
34.0
1,057.8
(31.0)
74.4
0.8
Managed
houses
£m
1,011.2
–
1,011.2
(31.9)
57.3
(6.8)
Managed
houses
£m
975.8
–
975.8
(30.1)
69.0
2.3
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
113
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
7. Revenue
The recognition of revenue from continuing operations under each of the group’s material revenue streams is as follows:
Drink sales
Food sales
Accommodation sales
Total revenue from contracts with customers
Other income1
Total revenue recognised
1 Other income includes rental income and room hire.
8. Operating costs before adjusting items
The table below shows operating costs before adjusting items from continuing operations:
Changes in inventories of finished goods and raw materials
Raw materials, consumables and finished goods used
Employment costs (note 9(a))
Depreciation of properties (note 19)
Depreciation of right-of-use assets (note 20)
Expense relating to short-term, low value or variable rent payments (note 28)
Other operating costs1
2023
53 weeks
£m
229.4
115.5
21.9
366.8
2.1
368.9
2023
53 weeks
£m
(0.7)
79.0
129.7
26.2
6.9
1.2
74.2
316.5
2022
52 weeks
£m
189.0
105.9
12.3
307.2
1.8
309.0
2022
52 weeks
£m
(2.1)
65.4
115.0
24.0
7.0
0.7
52.6
262.6
Auditor's remuneration in respect of audit of the group financial statements
0.5
0.4
1 During the prior period, credits of £2.2 million in respect of the Coronavirus Job Retention Scheme (‘CJRS’) were recognised within other operating costs, as permitted by IAS 20.
9. Employment
(a) Costs and employee numbers
Wages and salaries
Social security
Pension and health care schemes
Employment costs
Group
2023
53 weeks
£m
117.8
9.6
2.3
129.7
2022
52 weeks
£m
104.8
8.0
2.2
115.0
Company
2023
53 weeks
£m
117.8
9.6
2.3
129.7
2022
52 weeks
£m
104.8
7.9
2.2
114.9
The group’s and the company’s average monthly number of employees was 5,603 (2022 group and company: 4,850). The group’s
and the company’s number of employees at the period end was 5,654 (2022 group and company: 5,275).
The group’s and the company’s average monthly number of operational employees was 5,484 (2022 group and company: 4,737).
The group’s and the company’s number of operational employees at the period end was 5,535 (2022 group and company: 5,156).
The group’s and the company’s average monthly number of administration employees was 119 (2022 group and company: 113).
The group’s and the company’s number of administration employees at the period end was 119 (2022 group and company: 119).
114 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
(b) Directors’ emoluments
Stephen Goodyear
Simon Dodd
Mike Owen
Tracy Dodd4
Mark Loughborough5
Nick Miller
Ian McHoul
Torquil Sligo-Young6
Aisling Meany
Sarah Sergeant7
Patrick Dardis8
Roger Lambert9
Total
Basic
salary
and fees1
2023
£000
125
378
317
221
105
51
51
48
46
4
479
–
1,825
Basic
salary
and fees1
2022
£000
97
236
309
223
–
48
48
49
25
–
466
14
1,515
Benefits2
2023
£000
–
17
2
4
1
–
–
–
–
–
2
–
26
Benefits2
2022
£000
–
17
2
2
–
–
–
8
–
–
2
–
31
Total
excluding
pension
costs
2023
£000
125
670
559
383
170
51
51
48
46
4
628
–
2,735
Total
excluding
pension
costs
2022
£000
97
540
747
487
–
48
48
57
25
–
1,138
14
3,201
Bonus3
2022
£000
–
287
436
262
–
–
–
–
–
–
670
–
1,655
Bonus3
2023
£000
–
275
240
158
64
–
–
–
–
–
147
–
884
1 Certain car-related benefits can be taken as benefits in kind, in cash or as a combination of the two. Where any cash is taken, that sum is included with the amounts shown in the ‘Basic salary and
fees’ columns.
2 These relate to cars and/or private medical insurance.
3 For 2023, the remuneration committee determined that performance related bonuses were payable, at 64%, 64%, 73%, 63.5% and 64% of maximum to Simon Dodd, Mike Owen, Tracy Dodd,
Mark Loughborough and Patrick Dardis, respectively, pursuant to the bonus award letters issued in respect of FY2022/23. Mark Loughborough and Patrick Dardis received pro-rated bonuses for the
six months of the financial year they served as executive directors. For 2022, the remuneration committee determined that performance related bonuses were payable, at 100% of maximum, to the
executive directors pursuant to the bonus award letters issued in respect of FY2021/22. The remuneration committee further determined that a discretionary ex-gratia bonus of 25% of basic salary was
payable to the executive directors in December 2021.
4 Tracy Dodd has opted into the company car scheme and as a result she received a lower trade down allowance during the period.
5 Mark Loughborough was appointed to the board on 30 September 2022.
6 Torquil Sligo-Young stepped down as an executive director on 30 September 2020 and became a non-executive director. Included within the amount shown in the ‘Benefits 2022’ column is a cash
contribution paid towards private medical insurance.
7 Sarah Sergeant was appointed to the board on 1 March 2023.
8 Patrick Dardis stepped down from the board on 30 September 2022.
9 Roger Lambert stepped down from the board on 31 July 2021.
(c) Retirement benefits
Defined benefit pension scheme
The company operates a defined benefit pension scheme: the Young & Co.’s Brewery, P.L.C. Pension Scheme. All active members
contribute to it and continue to accrue benefits; during the period, those contributions were, on average, at a rate between 8% and
11% of pensionable earnings, dependent on each member’s accrual rate. The scheme invests largely in managed funds and liability
driven investments such as gilts. The company accounts for retirement benefits in accordance with IAS 19; detailed disclosures covering
this are set out in note 27. No director was accruing any defined benefit under the scheme as at 3 April 2023. Further, no director
accrued any defined benefit under the scheme during the period. Stephen Goodyear, Torquil Sligo-Young and Patrick Dardis are
pensioner members of the scheme.
Defined contribution pension scheme
The company operates a defined contribution pension scheme. As at 3 April 2023, Mike Owen, Simon Dodd, Tracy Dodd and Mark
Loughborough were members of the scheme and accruing retirement benefits under it. For the period, the company paid the following
contributions into the scheme for them in respect of their qualifying services, being an amount equal to not more than 6% of their
pensionable earnings, up to a pensionable earnings cap of £181,800 with figures impacted by the tapered annual allowance: for Mike
Owen – £4,000 (2022: £7,820), for Simon Dodd – £5,454 (2022: £9,972), for Tracy Dodd – £10,908 (2022: £9,972) and for Mark
Loughborough – £6,046 (2022: n/a). The company contribution rates for these four individuals are aligned with the contribution rates
for staff at Copper House (and certain others) who are members of the scheme.
Post-retirement health care
The company bears the cost of post-retirement health care premia for certain employees and ex-employees (see note 27).
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
115
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
9. Employment continued
(d) Profit sharing scheme
This scheme, which involved an annual profit share allocation, was closed some time ago. As a result, it has effectively been in ‘run-
off’, with periodic releases of accrued entitlements, represented by A shares, happening as and when a member reaches their normal
retirement date. Several years ago, it was agreed with HMRC that all accrued entitlements could be released free of tax, even where an
individual had not reached their retirement date. No A shares were released to scheme members during the period (2022: nil). As at
3 April 2023, an accrued entitlement effectively remained in respect of 712 A shares (2022: 712 A shares).
(e) Savings-related share option scheme
The company operates a savings-related share option scheme. Ordinarily, from year to year, eligible employees of the group are invited
to join the scheme and be granted options to buy shares in the company. Employees must agree to save a fixed monthly amount with
a savings institution through deductions from net salary, generally over a three-year period. The amount to be saved determines the
number of shares over which an option is granted. If the board chooses, options are granted at a discount of up to 20% of the market
price of a share at the time invitations are sent out to join the scheme for that year. There are no performance conditions other than
continued employment from a set date. In the period, options over 119,284 A shares were granted under the scheme at an exercise
price of 931 pence per share. The options will generally be exercisable between 1 February 2026 and 31 July 2026.
Of the directors who served throughout or during the period, only the following have an entitlement to A shares under the scheme:
Tracy Dodd
Simon Dodd
Mike Owen
Mark Loughborough3
Torquil Sligo-Young
Tracy Dodd
Simon Dodd
Mike Owen
At
28 March
2022
1,071
1,530
1,530
765
At
29 March
2021
659
–
–
–
Granted
–
–
–
–
Granted
–
1,071
1,530
1,530
Exercised
–
–
–
–
Exercised
659
–
–
–
At
3 April
2023
1,071
1,530
1,530
765
At
28 March
2022
–
1,071
1,530
1,530
Lapsed
–
–
–
–
Lapsed
–
–
–
–
Exercise price
(pence per
share)1
Ordinarily
exercisable
from
Ordinarily
exercisable
to
1,176 01.02.25 31.07.25
1,176 01.02.25 31.07.25
1,176 01.02.25 31.07.25
1,176 01.02.25 31.07.25
Exercise price
(pence per
share)1
Ordinarily
exercisable
from
Ordinarily
exercisable
to
1,364 01.09.21 28.02.22
1,176 01.02.25 31.07.25
1,176 01.02.25 31.07.25
1,176 01.02.25 31.07.25
Gains made
on exercise of
share options
(£)2
–
–
–
–
Gains made
on exercise of
share options
(£)2
830
–
–
–
1 The exercise prices of 1,364 pence and 1,176 pence per share represent a discount of not more than 20% to the market price of an A share at the time the relevant invitations to join the scheme were
issued, being 1,705 pence per share and 1,470 pence per share, respectively.
2 The gain made on the exercise of a share option is calculated by taking the difference between the exercise price and the opening market price of an A share on the day the option is exercised, and
then multiplying that by the number of A shares in respect of which the option is exercised.
3 Mark Loughborough was appointed to the board on 30 September 2022.
10. Government grants and assistance
During the prior period, the group was eligible for a number of government grant schemes which were introduced to mitigate the
impact of covid-19. The impact of each scheme on the income statement was as follows:
Government grant scheme
Government grant income
Coronavirus Job Retention Scheme ('CJRS')
Total government grants received
Income statement line impacted
Other income
Operating costs before adjusting items
All government grants received were in respect of continuing operations.
2023
53 weeks
£m
–
–
–
2022
52 weeks
£m
5.0
2.2
7.2
During the prior period, the group continued to take advantage of the business rate holiday, saving £3.7 million, further business
rate relief under the expanded retail discount, saving £2.0 million, and reduced 5% VAT on eligible sales until 30 September 2021,
followed by 12.5% VAT up until 31 March 2022.
Cash flows from grants received were included in cash flows from operations.
116 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
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11. Adjusting items
The table below shows adjusting items from continuing operations. For discontinued operations see note 5.
During the period the cash flow impact of adjusting items was £3.9 million (2022: £3.8 million), of which £3.0 million related to
investing activities and £0.9 million related to operating activities (2022: £3.6 million and £0.2 million respectively).
Amounts included in operating profit:
Upward movement on the revaluation of properties (note 19)1
Downward movement on the revaluation of properties (note 19)1
Purchase costs2
Tenant compensation3
Restructuring costs4
Net profit on disposal of properties5
Tax on adjusting items:
Tax attributable to adjusting items
Impact of change in corporation tax rate6
Total adjusting items after tax
2023
53 weeks
£m
2022
52 weeks
£m
4.8
(11.8)
(1.1)
(0.6)
(0.3)
–
(9.0)
1.2
(0.1)
1.1
(7.9)
5.5
(4.7)
(2.7)
(0.2)
–
2.4
0.3
(0.6)
(6.9)
(7.5)
(7.2)
1 The movement on the revaluation of properties is a non-cash item that relates to the revaluation exercise that was completed at the period end date. The revaluation was conducted at an individual
pub level and identified an upward movement of £4.8 million (2022: £5.5 million) representing reversals of previous impairments recognised in the income statement, and a downward movement
of £11.8 million (2022: £4.7 million), representing downward movements in excess of amounts recognised in equity. These resulted in a net downward movement of £7.0 million (2022: an upward
movement of £0.8 million) which has been recognised in the income statement. The downward movement for the period ended 3 April 2023 was split between land and buildings of £7.0 million
(2022: £0.8 million upward) and fixtures and fittings of £nil (2022: £nil). See note 6 for segmental information and note 19 for information on the revaluation of properties.
2 Costs related to professional fees and stamp duty land tax arising on the purchase of the Bedford Arms (Chenies), Merlin’s Cave (Chalfont St Giles), Half Moon (Windlesham), Griffin Inn (Fletching)
and the Carpenter’s Arms (Tonbridge). In the prior period, the costs related to the purchase of the Bull (Ditchling), Pheasant Inn (Lambourn), White Horse (Hascombe), the freehold of the Lamb
(Bloomsbury) and the Lucky Onion group, a group of six sites acquired on 21 February 2022. This also included lease extensions of the Cherry Tree (Dulwich), East Hill (Wandsworth) and Riverside
House (Wandsworth). The prior period costs included legal and professional fees and stamp duty land tax (note 14).
3 Tenant compensation of £0.6 million was paid to the previous tenants of an unlicensed property (Ealing) and the Bishop’s Vaults (Bishopsgate) to terminate their lease agreements early. During the
prior period, tenant compensation of £0.2 million was paid to previous tenants of the Grand Junction Arms (Harlesden) to terminate their lease agreement early.
4 Restructuring costs of £0.3 million related to a one-off reorganisation of the group’s head office functions. These were largely made up of severance costs.
5 During the current period, the group disposed of the Bridge Hotel (Greenford) and no profit or loss was recognised on the disposal. In the prior period, the profit on disposal of properties related to
the difference between cash, less disposal costs, received from the sale of the Grove House (Camberwell) and Lord Wargrave (Marylebone) and the carrying value of their assets, including goodwill,
at the dates of disposal, and the surrender premium related to the lease of Prince William Henry (Southwark).
6 An increase in the corporation tax rate from 19% to 25%, with effect from 1 April 2023, was announced in the March 2021 Budget, and substantively enacted on 24 May 2021. This has resulted
in an increase in the deferred tax liabilities and assets of the group at the balance sheet date, with a net charge of £0.1 million (2022: £6.9 million) associated with the rate change. The £0.1 million
is equal to the net of a £0.4 million adjustment in respect of deferred tax of prior periods, and a £0.3 million credit in respect of deferred tax measured at a higher rate. This has been recognised
as an exceptional item in the tax charge for the period as it is unrelated to the underlying trading activities of the group.
12. Other financial measures
The table below shows how adjusted group EBITDA, operating profit and profit before tax have been arrived at. They exclude adjusting
items which due to their material or non-recurring nature do not form part of the group’s underlying operations. These alternative
performance measures have been provided to help investors assess the group’s underlying performance. Details of the adjusting items
can be seen in note 11. All the results below are from continuing operations.
EBITDA
Depreciation and net movement on the revaluation of properties
Operating profit
Finance income
Finance costs
Finance charge for pension obligations
Profit before tax
2023
53 weeks
Adjusting
items
£m
2.0
7.0
9.0
–
–
–
9.0
Unadjusted
£m
83.5
(40.1)
43.4
0.1
(7.6)
0.3
36.2
Adjusted
£m
85.5
(33.1)
52.4
0.1
(7.6)
0.3
45.2
Unadjusted
£m
82.0
(30.3)
51.7
–
(9.5)
(0.1)
42.1
2022
52 weeks
Adjusting
items
£m
0.5
(0.8)
(0.3)
–
–
–
(0.3)
Adjusted
£m
82.5
(31.1)
51.4
–
(9.5)
(0.1)
41.8
During the period, £105.2 million (2022: £102.2 million) of adjusted EBITDA related to managed houses and £0.5 million
(2022: £0.6 million) related to tenanted houses. Adjusted negative EBITDA of £20.2 million (2022: negative £20.3 million) related
to head office costs and was unallocated.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
117
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
13. Finance costs
All the results below are from continuing operations.
Bank loans and overdrafts
Interest on lease liabilities (note 28)
14. Taxation
The major components of income tax expense for the periods ended 3 April 2023 and 28 March 2022 are:
Tax charged in the group income statement
Current income tax
Current tax expense
Adjustment in respect of current income tax of prior periods
Deferred tax
Relating to origin and reversal of temporary differences
Adjustment in respect of deferred tax of prior periods
Deferred tax measured at higher rate
Change in corporation tax rate
Income tax charged in the income statement1
2023
53 weeks
£m
5.1
2.5
7.6
2022
52 weeks
£m
7.0
2.5
9.5
2023
53 weeks
£m
2022
52 weeks
£m
7.3
0.9
8.2
(0.3)
(1.1)
(0.3)
–
(1.7)
6.5
4.8
(0.1)
4.7
6.7
(0.8)
–
6.9
12.8
17.5
1 During the current period, all income tax charged relates to continuing operations. During the prior period, income tax charged related to £17.2 million from continuing operations and £0.3 million
from discontinued operations.
2023
53 weeks
£m
(1.8)
(0.5)
0.4
0.1
–
0.4
(0.3)
–
(1.7)
3.7
(2.5)
0.8
–
2.0
2022
52 weeks
£m
2.3
2.4
0.2
–
1.0
–
–
6.9
12.8
4.8
3.3
1.0
17.3
26.4
Deferred tax in the group income statement
Property revaluation and disposals
Capital allowances
Retirement benefit schemes
Share based payments
Trade losses
Adjustment in respect of deferred tax of prior periods
Deferred tax measured at higher rate
Change in corporation tax rate
Deferred tax (credited)/charged in the income statement
Deferred tax in the group statement of other comprehensive income
Property revaluation and disposals
Retirement benefit schemes
Interest rate swaps – cash flow hedge
Change in corporation tax rate
Deferred tax charged to other comprehensive income
118 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
A reconciliation of the tax expense at the group’s effective tax rate to the accounting profit before tax at the statutory tax rate for the
periods ended 3 April 2023 and 28 March 2022 respectively is as follows:
Accounting profit before income tax
At the group's statutory income tax rate of 19% (2022: 19%)
Tax effects of:
Expenses not deductible for tax purposes1
Recognition of property revaluation, rollover claim and other property movements
Non-taxable income
Deferred tax measured at higher rate
Remeasurement of deferred tax – change in corporation tax rate
Prior period adjustment – current tax
Prior period adjustment – deferred tax
Total tax expense
2023
53 weeks
£m
36.2
2022
52 weeks
£m
51.9
6.9
2.8
(1.8)
(0.9)
(0.3)
–
0.9
(1.1)
6.5
9.9
0.6
2.2
(1.2)
–
6.9
(0.1)
(0.8)
17.5
1 Expenses not deductible for tax purposes include property acquisition costs, pension service costs, depreciation on assets ineligible for capital allowances and share based payments.
The 2021 Budget announced an increase in the corporation tax rate from 19% to 25% with effect from 1 April 2023. This was
substantively enacted on 24 May 2021. Accordingly, the deferred tax assets and liabilities at the balance sheet date are calculated at the
substantively enacted rate of 25%. The effect of this tax rate change has been recognised as an adjusting item (see note 11).
The table below shows the tax credit from discontinued operations.
Tax credited in the group income statement
Deferred tax
Rolled over gains on disposal of properties
Reversal of temporary differences on revaluations
Tax credited in the income statement
2023
53 weeks
£m
2022
52 weeks
£m
–
–
–
(1.8)
1.5
(0.3)
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
15. Business combinations
Acquisitions in 2023
During the period, the group acquired the Bedford Arms (Chenies), Merlin’s Cave (Chalfont St Giles), Half Moon (Windlesham),
Carpenter’s Arms (Tonbridge) and the Griffin Inn (Fletching), which formed business combinations for a total cash consideration of
£18.2 million, which was settled during the period. Each individual pub was not considered to be a material acquisition for the group.
When assets are acquired, management determines whether the assets form a business combination. Business combinations must
involve the acquisition of a business, which generally has three elements: input, process and output. The final aggregated fair value
of the identifiable assets and liabilities of the acquired businesses were property and equipment of £18.2 million. The group incurred
£1.1 million of costs associated with the acquisitions, which have been recorded within adjusting items (see note 11).
Between the date of acquisition and the balance sheet date, the Bedford Arms, Merlin’s Cave, Half Moon, Carpenter’s Arms and the
Griffin Inn contributed £3.3 million of revenue and a £0.7 million loss to the operating profit of the group. If the acquisitions had been
completed at the beginning of the period, group revenue for the period would have been expected to increase by £7.2 million and
group operating profit would have been expected to increase by £1.0 million.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
119
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
15. Business combinations continued
Acquisitions in 2022
Lucky Onion group
On 21 February 2022, the group and the company acquired the majority of sites in the Lucky Onion group; a Cotswold-based
premium pub and hotel operator. The total cash consideration was £24.3 million which was fully in respect of the six sites acquired,
consisting of 5 freehold and 1 leasehold sites. No share capital was exchanged.
The final fair values of identifiable assets and liabilities as at the acquisition date were as follows:
Identifiable assets and liabilities
Property and equipment (note 19)
Inventories
Right-of-use assets (note 20)
Lease liabilities (note 28)
Net assets
Goodwill
Cash consideration on acquisition of the Lucky Onion business
Fair value
£m
24.2
0.1
0.2
(0.2)
24.3
–
24.3
No goodwill was recognised as the fair value of net assets acquired was equal to the cash consideration exchanged.
The fair value of freehold property and equipment acquired was valued externally by Savills, independent chartered surveyors, taking
into account the properties’ highest and best value. The valuation was based on information such as current and historical levels of
turnover, gross profit, wages and overheads and resultant EBITDA. The valuers then applied an appropriate multiplier to the EBITDA.
For the leasehold site, the group measured the acquired lease liabilities using the present value of the remaining lease payments at
the date of acquisition. The right-of-use assets were measured at an amount equal to the lease liabilities and adjusted to reflect the
favourable terms of the lease relative to the market.
The group incurred £1.7 million of costs associated with the acquisition, which were recorded within operating adjusting items
(note 11).
In the prior period between the date of acquisition and the balance sheet date, the Lucky Onion group of pubs contributed £0.8 million
of revenue and £0.2 million of operating profit. If the acquisition had taken place at the beginning of the prior period, group
revenue would have been expected to increase by £7.5 million and group operating profit would have been expected to increase by
£2.0 million.
A £0.2 million deferred tax asset was recognised on account of the acquisition of the Lucky Onion group.
Other business combinations
In the prior period, the group also acquired the Bull (Ditchling), Pheasant Inn (Lambourn) and the White Horse (Hascombe) as business
combinations for considerations totaling £12.6 million. The final aggregated fair value of the identifiable assets and liabilities of the
acquired businesses were property and equipment of £12.6 million. The group incurred £1.0 million of costs associated with the
acquisitions, which were recorded within operating adjusting items (see note 11).
In the prior period between the date of acquisition and the balance sheet date, the Bull, Pheasant Inn and the White Horse contributed
£0.9 million of revenue and £34k to the operating profit of the group. If the acquisition had been completed at the beginning of the
period, group revenue for the period would have been expected to increase by £4.6 million and group operating profit would have
been expected to increase by £1.0 million.
Cash flow from business combinations
Lucky Onion group
Other business combinations
Total net cash outflow
120 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
2023
53 weeks
£m
–
(18.2)
(18.2)
2022
52 weeks
£m
(24.3)
(12.6)
(36.9)
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
16. Dividends on equity shares
Final dividend (previous period)
Interim dividend (current period)
2023
53 weeks
Pence per share
10.26
10.26
20.52
2022
52 weeks
Pence per share
–
8.55
8.55
2023
53 weeks
£m
6.0
6.0
12.0
2022
52 weeks
£m
–
5.0
5.0
The table above sets out dividends paid. In addition, the board is proposing a final dividend in respect of the period ended 3 April 2023
of 10.26 pence per share at a cost of £6.0 million. If approved, it is expected to be paid on 13 July 2023 to shareholders who are on
the register of members at the close of business on 9 June 2023.
17. Earnings per ordinary share
(a) Weighted average number of shares
Basic weighted average number of ordinary shares in issue
Dilutive potential ordinary shares from outstanding employee share options
Diluted weighted average number of shares
(b) Earnings attributable to the shareholders of the parent company
2023
53 weeks
Number
58,483,336
51,928
58,535,264
2022
52 weeks
Number
58,476,259
30,877
58,507,136
Profit for the period
Adjusting items
Tax attributable to above adjustments
Adjusted earnings after tax
Basic earnings per share
Basic
Effect of adjusting items
Adjusted basic earnings per share
Diluted earnings per share
Diluted
Effect of adjusting items
Adjusted diluted earnings per share
(c) Earnings from continuing operations
Profit for the period
Adjusting items
Tax attributable to above adjustments
Adjusted earnings after tax
Basic earnings per share
Basic
Effect of adjusting items
Adjusted basic earnings per share
Diluted earnings per share
Diluted
Effect of adjusting items
Adjusted diluted earnings per share
£m
29.7
9.0
(1.1)
37.6
Pence
50.78
13.51
64.29
Pence
50.74
13.49
64.23
£m
29.7
9.0
(1.1)
37.6
Pence
50.78
13.51
64.29
Pence
50.74
13.49
64.23
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
£m
34.4
(9.3)
7.8
32.9
Pence
58.83
(2.57)
56.26
Pence
58.80
(2.57)
56.23
£m
24.9
(0.3)
7.5
32.1
Pence
42.58
12.31
54.89
Pence
42.56
12.31
54.87
121
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
17. Earnings per ordinary share continued
(d) Earnings per ordinary share for discontinued operations
Profit for the period
Adjusting items
Tax attributable to above adjustments
Adjusted earnings after tax
Basic earnings per share
Basic
Effect of adjusting items
Adjusted basic earnings per share
Diluted earnings per share
Diluted
Effect of adjusting items
Adjusted diluted earnings per share
£m
–
–
–
–
Pence
–
–
–
Pence
–
–
–
£m
9.5
(9.0)
0.3
0.8
Pence
16.25
(14.88)
1.37
Pence
16.24
(14.88)
1.36
The basic earnings per share figure is calculated by dividing the net profit for the period attributable to equity shareholders of the parent
by the weighted average number of ordinary shares in issue during the period.
Diluted earnings per share have been calculated on a similar basis taking into account 51,928 (2022: 30,877) dilutive potential shares
under the SAYE and LTIP schemes (see notes 9(e) and 30).
Adjusted earnings per share are presented to eliminate the effect of the adjusting items and the tax attributable to those items on basic
and diluted earnings per share.
18. Goodwill
Goodwill is recognised in respect of the following acquisitions:
Geronimo Inns Limited
Redcomb Pubs Limited
Spring Pub Company Limited
Smiths of Smithfield Ltd
580 Limited
At 3 April 2023
Group
2023
£m
18.4
8.8
3.3
1.1
0.9
32.5
2022
£m
18.4
8.8
3.3
1.1
0.9
32.5
Company
2023
£m
17.0
8.7
3.3
1.1
0.9
31.0
2022
£m
17.0
8.7
3.3
1.1
0.9
31.0
122 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Cost
At 29 March 2021
Acquisitions
At 28 March 2022
Acquisitions
At 3 April 2023
Amortisation
At 29 March 2021
Disposals
At 28 March 2022
Disposals
At 3 April 2023
Carrying amount
At 29 March 2021
At 28 March 2022
At 3 April 2023
Group
£m
34.7
–
34.7
–
34.7
2.2
–
2.2
–
2.2
32.5
32.5
32.5
Company
£m
31.4
–
31.4
–
31.4
0.4
–
0.4
–
0.4
31.0
31.0
31.0
The opening group goodwill of £32.5 million arose on the acquisition of Geronimo Group Limited, Redcomb Pubs Limited, Spring Pub
Company Limited, Smiths of Smithfield Ltd and 580 Limited.
The group tests goodwill annually for impairment or more frequently if there are indicators that goodwill may have been impaired.
There will be an impairment if the recoverable amount is lower than carrying value. The recoverable amount in this case is value in
use because value in use exceeds ‘fair value less costs to sell’. The value in use is calculated using the budget approved by the board.
No impairment was recognised in the current period (2022: £nil).
For Geronimo Group Limited and 580 Limited, cash flows assume 1.4% growth (2022: 1.4%) from a base of expected FY24 EBITDA,
derived from the board approved FY24 budget. For Smiths of Smithfield Ltd, growth rates were higher over a five-year period to reflect
the opening of the Museum of London in 2026 and Smithfield Market in 2028, and then revert back to a long-term growth rate of
1.4% thereafter. For Spring Pub Company Limited, growth rates were higher over a five-year period to reflect a build up to expected
trade levels, and then revert back to a long-term growth rate of 1.4% thereafter. For Redcomb Pubs Limited, growth rates varied across
the estate depending on current and future expected performance over a five-year period, and then reverted back to a long-term
growth rate of 1.4% thereafter. The pre-tax discount rate applied to all cash flow projections is 9.7% (2022: 9.2%).
The group monitors the latest government legislation in relation to climate related matters. At the current time, no legislation has been
passed that will significantly impact the group’s impairment review. The group will adjust the key assumptions used in value in use
calculations and sensitivity to changes in assumptions should a change be required.
The impairment calculation is most sensitive to the pre-tax discount rate and EBITDA assumptions. Management have performed a
sensitivity analysis on the impairment test. Several scenarios have been modelled, with specific reference to the impact of an increase
in the discount rate or a decrease in the long-term growth rates used in the model. For Smiths of Smithfield Ltd, the headroom would
be eliminated as a result of increasing the pre-tax discount rate to 11.2% or reducing EBITDA by 13.8% from forecast levels. For Spring
Pub Company Limited, the headroom would be eliminated as a result of increasing the pre-tax discount rate to 11.2% or reducing
EBITDA by 13.3% from forecast levels. For Redcomb Pubs Limited, the headroom would be eliminated as a result of increasing the
pre-tax discount rate to 10.8% or reducing EBITDA by 10.1% from forecast levels. If trade continued at the current year level with
no future growth rate, an impairment would be recognised for Smiths of Smithfield Ltd, Spring Pub Company Limited, and Redcomb
Pubs Limited.
For Geronimo Group Limited and 580 Limited, management does not consider the impairment calculation to be sensitive to the
pre-tax discount rate, EBITDA assumptions, or long-term growth rate assumptions.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
123
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
19. Property and equipment
Cost or valuation
At 29 March 2021
Additions
Business combinations
Disposals1
Fully depreciated assets
Revaluation2
– upward movement in valuation
– downward movement in valuation
At 28 March 2022
Additions
Business combinations
Disposals
Fully depreciated assets
Revaluation2
– upward movement in valuation
– downward movement in valuation
At 3 April 2023
Depreciation and impairment
At 29 March 2021
Depreciation charge
Disposals1
Fully depreciated assets
Revaluation2
- upward movement in valuation
- downward movement in valuation
At 28 March 2022
Depreciation charge
Disposals
Fully depreciated assets
Revaluation2
– upward movement in valuation
– downward movement in valuation
At 3 April 2023
Net book value
At 29 March 2021
At 28 March 2022
At 3 April 2023
Group
Fixtures,
fittings &
equipment
£m
156.2
25.4
1.5
(10.8)
(18.3)
–
–
154.0
30.7
2.4
(0.7)
(24.2)
–
–
162.2
76.7
22.8
(5.3)
(18.3)
–
–
75.9
24.5
(0.4)
(24.2)
–
–
75.8
79.5
78.1
86.4
Land &
buildings
£m
717.9
11.5
35.3
(44.2)
(0.5)
40.3
(10.7)
749.6
9.5
15.8
(6.1)
(0.2)
37.7
(22.2)
784.1
23.7
1.6
(5.2)
(0.5)
(4.6)
4.7
19.7
1.7
(0.5)
(0.2)
(4.8)
12.1
28.0
694.2
729.9
756.1
Company
Fixtures,
fittings &
equipment
£m
150.1
25.3
1.5
(10.8)
(18.2)
–
–
147.9
30.7
2.4
(0.7)
(24.2)
–
–
156.1
75.4
22.7
(5.3)
(18.2)
–
–
74.6
24.4
(0.4)
(24.2)
–
–
74.4
74.7
73.3
81.7
Land &
buildings
£m
717.6
11.5
35.3
(44.2)
(0.5)
40.3
(10.7)
749.3
9.5
15.8
(6.1)
(0.2)
37.7
(21.9)
784.1
23.2
1.5
(5.2)
(0.5)
(4.6)
4.7
19.1
1.6
(0.5)
(0.2)
(4.8)
12.1
27.3
694.4
730.2
756.8
Total
£m
874.1
36.9
36.8
(55.0)
(18.8)
40.3
(10.7)
903.6
40.2
18.2
(6.8)
(24.4)
37.7
(22.2)
946.3
100.4
24.4
(10.5)
(18.8)
(4.6)
4.7
95.6
26.2
(0.9)
(24.4)
(4.8)
12.1
103.8
773.7
808.0
842.5
Total
£m
867.7
36.8
36.8
(55.0)
(18.7)
40.3
(10.7)
897.2
40.2
18.2
(6.8)
(24.4)
37.7
(21.9)
940.2
98.6
24.2
(10.5)
(18.7)
(4.6)
4.7
93.7
26.0
(0.9)
(24.4)
(4.8)
12.1
101.7
769.1
803.5
838.5
1 During the prior period, the majority of the disposals related to the sale of 56 tenanted pubs (see note 5).
2 The group’s net book value uplift during the period was £8.2 million (2022: £29.5 million). This uplift was recognised either in the revaluation reserve or the income statement, as appropriate.
124 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
The impact of the property revaluation exercise was as follows:
Income statement
Revaluation loss charged as impairment
Reversal of past impairment
Net (impairment)/uplift recognised in the income statement
Revaluation reserve
Unrealised revaluation surplus
Reversal of past surplus
Net uplift recognised in the revaluation reserve
Net revaluation increase in property
Group
2023
53 weeks
£m
2022
52 weeks
£m
Company
2023
53 weeks
£m
2022
52 weeks
£m
(11.8)
4.8
(7.0)
37.4
(22.2)
15.2
8.2
(4.7)
5.5
0.8
39.5
(10.8)
28.7
29.5
(11.8)
4.8
(7.0)
37.4
(21.9)
15.5
8.5
(4.7)
5.5
0.8
39.5
(10.8)
28.7
29.5
(a) Revaluation of property and equipment
On an annual basis, the group’s property estate is valued externally by Savills, independent Chartered Surveyors, in accordance
with the provisions of the RICS Valuation – Professional Standards January 2014 (Revised April 2015) (‘the Red Book’), which takes
account of the properties’ highest and best value.
The valuation is based on information such as current and historical levels of turnover, gross profit, wages and overheads and
resultant EBITDA. The valuers have then applied a multiplier to the EBITDA based upon the relative risks associated with the trading
format, tenure and property. In a number of cases, the value of the property derived purely from an income approach understates
the underlying property value. In these cases the valuers have applied a spot value to the property rather than a value derived from
a multiple applied to the income. For a small number of properties, a net investment yield valuation approach is considered most
appropriate based upon the nature of site operations.
The valuations and assumptions used are reviewed by the board and the independent statutory auditor. The highest and best use of
the group’s properties do not differ materially from their current use.
These techniques are consistent with the principles in IFRS 13 Fair Value Measurement and use significant unobservable inputs
such that the fair value measurement of each property within the portfolio has been classified as Level 3 (2022: Level 3) in the fair
value hierarchy.
The key inputs to valuation on property and equipment are as follows:
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
2023
Managed houses
Managed houses
Tenanted houses
Segment total
Leasehold properties
Unallocated
Total net book value at 3 April 2023
2022
Managed houses
Managed houses
Tenanted houses
Segment total
Leasehold properties
Unallocated
Total net book value at 28 March 2022
Tenure
Freehold
Freehold
Freehold
Tenure
Freehold
Freehold
Freehold
EBITDA multiple range
Low
8.0
Spot
Spot
EBITDA multiple range
Low
8.0
Spot
Spot
High
12.0
Spot
Spot
High
12.0
Spot
Spot
Number
of pubs
106
61
1
168
59
–
227
Number
of pubs
114
46
3
163
59
–
222
Value
of pubs
£m
569.4
223.2
4.9
797.5
33.0
12.0
842.5
Value
of pubs
£m
547.0
205.1
8.9
761.0
35.1
11.9
808.0
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
125
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
19. Property and equipment continued
If, at 3 April 2023, the property estate was carried at historical cost less accumulated depreciation and impairment losses, its carrying
amount would be approximately £490.7 million (2022: £464.4 million).
The revaluation surplus represents the amount by which the fair value of the estate exceeds its historic cost.
A sensitivity analysis was conducted on the property estate to give an indication of the impact of movements in the most sensitive
assumption, EBITDA. The analysis considers this single change with the other assumptions unchanged. In practice, changes in one
assumption may be accompanied by changes in another. Changes in market values may also occur at the same time as any changes
in assumptions. This information should not be taken as a projection of likely future valuation movements. Decreasing the EBITDA
used in the revaluation by 10% would decrease the total valuation by £56.9 million (2022: £54.7 million). Increasing the EBITDA
used in the revaluation model by 10% would increase the total valuation by £56.9 million (2022: £54.7 million).
(b) Disaggregation of property and equipment
The table below sets out the disaggregation of property and equipment between pubs used by the group and pubs leased to tenants.
Land & buildings
At 29 March 2021
Additions, disposals and transfers
Depreciation charge
Revaluation
At 28 March 2022
Additions, disposals and transfers
Depreciation charge
Revaluation
At 3 April 2023
Fixtures, fittings & equipment
At 29 March 2021
Additions, disposals and transfers
Depreciation charge
At 28 March 2022
Additions, disposals and transfers
Depreciation charge
At 3 April 2023
(c) Capital commitments
Capital commitments not provided for in these financial statements
and for which contracts have been placed amounted to:
Used by group
£m
645.3
48.3
(1.6)
29.4
721.4
19.7
(1.7)
8.2
747.6
Group and company
Leased to tenants
£m
48.9
(40.5)
–
0.1
8.5
–
–
–
8.5
Used by group
£m
73.5
26.5
(22.3)
77.7
32.8
(24.4)
86.1
Group and company
Leased to tenants
£m
6.0
(5.1)
(0.5)
0.4
–
(0.1)
0.3
2023
£m
4.0
Total
£m
694.2
7.8
(1.6)
29.5
729.9
19.7
(1.7)
8.2
756.1
Total
£m
79.5
21.4
(22.8)
78.1
32.8
(24.5)
86.4
2022
£m
4.2
126 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
20. Right-of-use assets
Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period:
At 29 March 2021
Additions
Business combinations
Lease amendments
Depreciation
Disposals
At 28 March 2022
Additions
Lease amendments
Depreciation
At 3 April 2023
Group
Company
Property
£m
157.8
0.8
0.2
0.1
(6.9)
(5.2)
146.8
–
2.4
(6.7)
142.5
Motor vehicles
£m
0.2
0.2
–
–
(0.2)
–
0.2
0.4
–
(0.2)
0.4
Other assets
£m
–
–
–
–
–
–
–
–
–
–
–
Total
£m
158.0
1.0
0.2
0.1
(7.1)
(5.2)
147.0
0.4
2.4
(6.9)
142.9
Property
£m
148.9
0.8
0.2
0.3
(6.0)
(5.2)
139.0
–
2.0
(5.8)
135.2
Motor vehicles
£m
0.3
0.2
–
–
(0.1)
–
0.4
0.4
–
(0.2)
0.6
Other assets
£m
–
–
–
–
–
–
–
–
–
–
–
Total
£m
149.2
1.0
0.2
0.3
(6.1)
(5.2)
139.4
0.4
2.0
(6.0)
135.8
The depreciation charge is recognised within operating costs in the income statement.
In the prior period, disposals of £3.3 million related mostly to the disposal of 7 of the tenanted pubs (note 5) and the remaining
disposals related to continuing operations.
Lease amendments in the current and prior period largely represent upwards market rent reviews.
The group tests right-of-use assets for impairment when there are indicators that the assets may have been impaired. An impairment
is recognised if the recoverable amount is lower than carrying value. Recoverable amount is calculated by value in use. The inputs to
the impairment model are consistent with those applied to the goodwill impairment model (see note 18). No impairment has been
recognised in the current period (2022: £nil).
The impairment calculation is most sensitive to the pre-tax discount rate and EBITDA assumptions. Management have performed a
sensitivity analysis on the impairment test. A 1% increase in the pre-tax discount rate would result in an impairment loss of £1.6 million.
A 10% fall in EBITDA in year one would result in an impairment loss of £1.0 million to the right-of-use assets.
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
21. Investments in subsidiaries
Cost and net book value
At 29 March 2021
Additions
Impairment
At 28 March 2022
Additions
Impairment
At 3 April 2023
The group financial statements include:
Group subsidiary undertakings
580 Limited
BFI Limited1
Geronimo Inns Limited
Old Manor Trading Ltd1
Redcomb Pubs & Bars Limited1
Redcomb Pubs Limited
Smiths of Smithfield Ltd
Company
£m
14.3
–
–
14.3
–
–
14.3
Country of
incorporation
and registration
England
England
England
England
England
England
England
% of equity
and votes held
100
100
100
100
100
100
100
1 The shares in these subsidiary undertakings were previously held indirectly. During the period, applications were made to strike off Old Manor Trading Ltd, Redcomb Pubs & Bars Limited,
and Redcomb Pubs Limited. As part of this, BFI Limited is now a direct investment of the company.
The subsidiaries listed above are exempt from the requirements of the Companies Act 2006 relating to the audit of individual accounts
by virtue of Section 479A of that Act.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
127
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
21. Investments in subsidiaries continued
During the current period, applications were made to strike off Old Manor Trading Ltd, Redcomb Pubs & Bars Limited and Redcomb
Pubs Limited. As part of this, the company exchanged its investment in Redcomb Pubs Limited for a direct investment in BFI Limited
(previously an indirect holding through Redcomb Pubs Limited). There were no gains or losses recognised on this transaction.
Smiths of Smithfield Ltd was struck off and dissolved on 5 January 2021. Before that, it was a wholly owned subsidiary of the
company. During the period, Smiths of Smithfield Ltd was restored to the register via court order to allow for a rental deposit to be
returned. An application to dissolve Smiths of Smithfield Ltd will be made as soon as the business relating to the rental deposit has
been completed.
During the prior period, Spring Pub Company Limited was dissolved on 1 June 2021 and The Canbury Arms Limited was dissolved
on 12 October 2021. Before dissolution, both Spring Pub Company Limited and The Canbury Arms Limited were wholly owned
subsidiaries of the company.
Each of the company’s subsidiary undertakings has its registered office located at Copper House, 5 Garratt Lane, Wandsworth, London
SW18 4AQ.
22. Inventories
Finished goods and raw materials
23. Trade and other receivables
Trade receivables
Other receivables
Prepayments
Amounts due from subsidiaries
Group
2023
£m
5.4
Group
2023
£m
3.5
1.8
4.2
–
9.5
2022
£m
4.7
2022
£m
3.6
1.7
3.6
–
8.9
Company
2023
£m
5.4
Company
2023
£m
3.5
1.8
4.2
–
9.5
2022
£m
4.7
2022
£m
3.6
1.7
3.3
1.1
9.7
Trade receivables are denominated in sterling, are non-interest bearing and are generally on 0-20 days terms. They are carried at
amortised cost less expected lifetime credit losses.
Other receivables include £1.6 million (2022: £1.6 million) for fees in respect of project costs.
Prepayments include an amount due from the pension scheme in respect of payments made to beneficiaries on behalf of the scheme.
The balance outstanding at 3 April 2023 was £0.1 million (2022: £0.1 million). The amount is non-interest bearing and is repayable
on demand.
The 12-month expected credit losses on amounts due from subsidiaries are not material in the current period or prior period.
At 3 April 2023, there were expected lifetime credit losses recognised against the trade receivables of £0.1 million (2022: £0.1 million).
The table below provides an indication of movement during the period.
Opening balance
Amounts written off
2023
53 weeks
£m
0.1
–
0.1
2022
52 weeks
£m
0.5
(0.4)
0.1
128 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Management have applied the provision matrix to identify expected credit losses in the current period as follows:
2023
Percentage loss rate
Expected lifetime credit loss
2022
Percentage loss rate
Expected lifetime credit loss
Neither past
due nor
impaired
£m
3.5
1%
0.1
2.6
1%
–
Total
£m
3.6
0.1
3.7
0.1
<31
days
£m
–
6%
–
0.2
14%
–
31–60
days
£m
–
6%
–
0.2
6%
–
61–90
days
£m
–
1%
–
0.2
22%
–
91+
days
£m
0.1
18%
–
0.5
27%
0.1
The expected lifetime credit loss has reduced due to the disposal of 56 of the pubs within the tenanted segment (note 5) in the prior
period. The tenanted pubs historically recognised receivable balances at a higher percentage loss rate than other receivable categories.
The overall percentage loss rate has therefore declined accordingly.
24. Trade and other payables
Trade payables
Other tax and social security
Other creditors
Accruals and deferred income
Amounts due to subsidiaries
Group
2023
£m
13.4
11.7
7.7
13.8
–
46.6
2022
£m
14.5
5.7
9.5
14.0
–
43.7
Company
2023
£m
13.4
11.7
6.0
13.8
11.3
56.2
2022
£m
14.5
5.7
8.4
14.0
13.2
55.8
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
All trade payables are payable on demand and the carrying values above equate to fair value.
Other creditors mainly consist of employee and property related creditors.
25. Capital management and financial instruments
The group’s capital management objective is to maintain an optimal structure, measuring investment opportunities against returning
capital to shareholders, but with an appropriate level of gearing. This provides a platform from which the group can seek to maximise
shareholder value. The board monitors its capital using gearing ratios, such as net debt as a multiple of EBITDA and interest cover.
All covenants in relation to bank loans are prepared on a pre-IFRS 16 basis. The covenants reference net debt/EBITDA, gearing % and
PBIT/borrowing costs. The group finances the business with a mixture of equity (note 29) and debt (note 32).
The group’s principal treasury objective is to manage financial risks and provide secure and competitively priced funding for the group’s
activities. When appropriate, the group uses financial instruments and derivatives to manage these risks.
The borrowing requirements are met largely by bank debt. Other sources of funding arise directly from trading activities, such as trade
and other payables. The right-of-use assets are funded by lease liabilities.
The main financial risks relate to interest rates, credit, liquidity and cash flow. Other risks that the group faces are referred to in the
principal risks and uncertainties section starting on page 44. The board seeks to manage the financial risks in the following manner:
Interest rate risk
The objective is to minimise the group’s interest cost and provide protection from adverse movements in interest rates. The board does
this by maintaining a mix of debt facilities at fixed and variable interest rates. Interest rate swaps are used to help manage this exposure
by fixing interest rates whilst matching the maturity profile and cash flows of the underlying debt. These swaps are designated as cash
flow hedges.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
129
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
25. Capital management and financial instruments continued
The following table demonstrates the current sensitivity of the group’s profit before tax to a change in interest rates, with all other
variables held constant.
2023
2022
Increase/
decrease in %
+1.0
-0.5
+1.0
-0.5
Effect on profit
before tax
£m
(0.00)
0.00
(0.00)
0.00
Credit risk
The objective is to minimise the group’s credit risk. Credit risks include counterparties defaulting on their debts or other obligations
which would impair the group’s ability to recover the carrying value of that asset. This is assessed with regard to historical credit losses
experienced, the current economic climate, expected changes in forecasts and specific other factors of future events.
The group has financial control policies which it follows before entering into arrangements with a new counterparty or when there is a
substantial change in the existing relationship. Any potential impairments are monitored and where appropriate a provision is made for
any irrecoverable balances. The group’s maximum credit risk is considered to be limited to its trade receivables (note 23). The company
is not considered to have any material exposure to credit risk from amounts due from subsidiaries.
Liquidity and cash flow risk
The objective is to ensure that the group has sufficient financial resources to develop its existing business and exploit opportunities as
they arise. The board manages liquidity risk by ensuring that the group’s debt profile is long-dated, facilities are committed and the
group does not rely unduly on short-term borrowings. The group’s borrowings are dependent on certain financial covenants being met.
If these were to be breached, funding could be withdrawn, leaving the group with insufficient working capital. If the group were unable
to find other alternative sources of funding it may not be possible to continue trading in its current form. The group has considered
the effects of its latest forecasts on its compliance with bank covenants, which are tested each quarter on a twelve-month rolling basis.
The board is vigilant in managing the business, assessing and monitoring acquisitions and investments, and forecasting the group’s
profit and cash flows. The funding position of the group is continuously reviewed against the headroom in the group’s borrowing
facilities (see note 1).
(a) Derivative financial instruments: interest rate swaps
Current liabilities
Current assets
Non-current liabilities
Non-current assets
Total financial assets
Net movement of interest rate swaps recognised in other comprehensive income
Group and company
2023
£m
–
2.7
–
2.3
5.0
3.1
2022
£m
(0.3)
–
–
2.2
1.9
5.2
The group has a number of interest rate swaps that fix future interest cash flows on the variable interest rate bank loans.
These instruments result in the group paying fixed interest rates on the notional amount for each swap’s life. The swaps are being used
to hedge the exposure to changes in the group’s cash flows on its variable rate loans due to changes in SONIA (previously LIBOR).
The secured loans and the interest rate swaps have the same critical terms over their relevant period.
The duration of each swap and its respective interest rates, once combined with the bank’s margin and other costs, are detailed in part
(b) of this note.
130 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
(b) Loans, borrowings, interest rates and fair values
2023
Secured
£10 million loan swapped into fixed rate
£10 million loan swapped into fixed rate
£25 million loan swapped into fixed rate2
£25 million loan swapped into fixed rate2
£35 million private placement at fixed rate3
£100 million revolving credit facility4
Financial liabilities
Term or
expiry date
May 2024
May 2024
May 2026
May 2026
July 2039
March 2025
Group and company
Effective
interest
rate when
hedged
3.27%
2.71%
2.05%
2.05%
Fixed
Variable
Variable
interest
rate when
unhedged1
S+1.85%
S+1.50%
S+1.85%
S+1.85%
Fixed
S+1.25%
Period
rate fixed
2 years
2 years
4 years
4 years
17 years
None
Fair
value
2023
£m
9.6
9.6
22.7
22.7
34.7
(0.1)
99.2
Book
value
2023
£m
10.0
10.0
24.8
24.8
34.7
(0.1)
104.2
1 For variable rate loans, the interest rate payable is SONIA (S) plus the margin shown.
2 During the current period, the £50 million syndicated facility with NatWest and HSBC was extended by one year (the first of a two-year option to extend) to 19 May 2026.
3 £35.0 million private placement has a fixed rate of interest at 3.3%.
4 Fair value and book value represent unamortised arrangement fees only due to the balance of £nil drawn as at 3 April 2023.
The following table represents the carrying values and nominal amounts of the group’s interest rate swaps as at 3 April 2023:
Hedge
£10 million loan swapped into fixed rate
£10 million loan swapped into fixed rate
£30 million loan swapped into fixed rate
£30 million loan swapped into fixed rate
£25 million loan swapped into fixed rate
£25 million loan swapped into fixed rate
£25 million loan swapped into fixed rate
£25 million loan swapped into fixed rate
At
Gain/(loss)
Nominal
Amount
Maturity
£10m May 2024
£10m May 2024
£20m March 2023
£10m March 2023
£25m May 2025
£25m May 2026
£25m May 2025
£25m May 2026
28 March 2022
£m
0.1
0.2
(0.7)
(0.3)
1.3
–
1.3
–
1.9
OCI
£m
0.3
0.2
0.7
0.3
0.7
0.1
0.7
0.1
3.1
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Gain/(loss)
P&L
£m
–
–
–
–
–
–
–
–
–
At
3 April 2023
£m
0.4
0.4
–
–
2.0
0.1
2.0
0.1
5.0
As at 3 April 2023, the group had committed borrowing facilities of £205.0 million, of which £105.0 million was drawn down, net of
arrangement fees of £0.8 million.
Current borrowings
Non-current borrowings
Financial liabilities
Unsecured current lease liabilities
Unsecured non-current lease liabilities
Financial liabilities
2022
Secured
£30 million loan swapped into fixed rate
£10 million loan swapped into fixed rate
£10 million loan swapped into fixed rate
£25 million loan swapped into fixed rate
£25 million loan swapped into fixed rate
£35 million private placement at fixed rate2
£100 million revolving credit facility3
Financial liabilities
Group and company
Effective
interest
rate
5.97%
5.02%
3.71%
2.05%
2.05%
Fixed
Variable
Variable
interest
rate when
unhedged1
S+0.95%
S+3.60%
S+2.50%
S+1.85%
S+1.85%
Fixed
S+1.25%
Period
rate fixed
1 Year
3 years
3 years
4 years
4 years
18 years
None
Term or
expiry date
March 2023
May 2024
May 2024
May 2025
May 2025
July 2039
March 2025
Group
2023
£m
–
104.2
104.2
4.8
66.9
175.9
Fair
value
2022
£m
31.0
9.8
9.8
23.5
23.5
34.7
(0.3)
132.0
Company
2023
£m
–
104.2
104.2
4.0
61.9
170.1
Book
value
2022
£m
30.0
9.9
9.9
24.8
24.8
34.7
(0.3)
133.8
1 For variable rate loans, the interest rate payable is either 1-month or 3-month LIBOR (L) plus the margin shown.
2 £35.0 million private placement has a fixed rate of interest at 3.3%.
3 Fair value and book value represent unamortised arrangement fees only due to the balance of £nil drawn as at 28 March 2022.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
131
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
25. Capital management and financial instruments continued
As at 28 March 2022, the group had committed borrowing facilities of £235.0 million, of which £135.0 million was drawn down, net
of arrangement fees of £1.2 million.
Current borrowings
Non-current borrowings
Financial liabilities
Unsecured current lease liabilities
Unsecured non-current lease liabilities
Financial liabilities
Group
2022
£m
30.0
103.8
133.8
4.9
69.1
207.8
Company
2022
£m
30.0
103.8
133.8
4.1
63.6
201.5
The secured borrowings are secured on the freehold assets of the group (other than two pubs, broadly up to a value of £9.8 million,
which provide security to the Young & Co.’s Brewery, P.L.C. Pension Scheme).
The fair values of borrowings and interest rate derivatives are estimates based on prevailing market rates of interest and expected
future cash flows arising from those instruments. The group enters into interest rate derivatives with various banks; these counterparties
each have investment grade credit ratings. Interest rate swaps are valued using Level 2 valuation techniques, which employ the use
of market observable inputs. The valuation techniques include swap models using present value calculations. The models incorporate
various inputs, including the credit quality of counterparties, discount factors and interest rate curves. As at 3 April 2023, the marked-
to-market value of other derivative asset positions is net of a credit valuation adjustment attributable to derivative counterparty default
risk. The changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in
hedge relationships.
Bank overdrafts
Bank overdrafts are used for day-to-day cash management. The group has a £10.0 million overdraft facility with interest linked to the
Bank of England base rate. No amounts were drawn down at 3 April 2023 or 28 March 2022.
Bank loans
The group has a bilateral £10.0 million term loan with Barclays Bank plc and a bilateral £10.0 million term loan with HSBC Bank plc,
both repayable on 23 May 2024.
The group also has a £50.0 million syndicated facility with NatWest and HSBC. During the current period, the group exercised the
first of its two-year option to extend the term of the loan by 12 months. The syndicated loan is now repayable on 19 May 2026.
This extension did not meet the criteria to be classified as a substantial modification, and therefore was accounted for as a modification
to the existing liability, and not as a derecognition of the original loan facility. No gain or loss was recognised within the statement of
comprehensive income as a result of this modification. Interest rate swaps have been entered into in respect of these bank loans which
result in the effective interest charge being fixed at the rates disclosed on the previous page.
The group had a lateral £30.0 million term loan with NatWest which was repaid during the year upon maturity.
In July 2019, the group completed the addition of a private placement debt facility, raising £35.0 million at a fixed rate of 3.3%
repayable in July 2039.
Revolving credit facility
The group has a £100.0 million revolving credit facility, split evenly with Barclays and HSBC, which matures in March 2025.
At 3 April 2023, the facility was undrawn (2022: undrawn). Final repayment of the total drawn down balance is due as one payment
on 20 March 2025. This is a committed facility which permits drawings of different amounts and for different periods. These drawings
carry interest at a margin above SONIA with a commitment payment on the undrawn portions. Interest is payable at each loan
renewal date.
132 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
(c) Maturity of the group’s financial liabilities and expiry of facilities
The below maturity tables include contractual gross undiscounted cash flows of the borrowings, related interest, net derivatives, finance
leases, trade and other payables and contractual accruals.
2023
Borrowings
Derivative financial instruments
Lease liabilities
Trade and other payables
2023
Borrowings
Derivative financial instruments
Lease liabilities
Trade and other payables
Amounts due to subsidiaries
2022
Borrowings
Derivative financial instruments
Lease liabilities
Trade and other payables
2022
Borrowings
Derivative financial instruments
Lease liabilities
Trade and other payables
Amounts due to subsidiaries
Within
one year
£m
0.9
0.4
7.1
34.9
43.3
Within
one year
£m
0.9
0.3
6.1
33.2
11.3
51.8
Within
one year
£m
31.2
(1.9)
7.3
38.0
74.6
Within
one year
£m
31.2
(1.9)
6.3
36.9
13.2
85.7
Between
one and
two years
£m
21.0
0.1
6.8
–
27.9
Between
one and
two years
£m
20.9
0.1
5.9
–
–
26.9
Between
one and
two years
£m
1.3
0.3
6.7
–
8.3
Between
one and
two years
£m
1.3
0.3
5.8
–
–
7.4
Group
Between
two and
five years
£m
53.0
1.4
19.1
–
73.5
Company
Between
two and
five years
£m
53.0
1.4
16.8
–
–
71.2
Group
Between
two and
five years
£m
72.4
0.2
18.6
–
91.2
Company
Between
two and
five years
£m
72.4
0.2
16.2
–
–
88.8
After
five years
£m
48.9
–
66.8
–
115.7
After
five years
£m
48.9
–
64.4
–
–
113.3
After
five years
£m
51.2
–
71.5
–
122.7
After
five years
£m
51.2
–
68.6
–
–
119.8
(d) Fair value hierarchy for instruments measured at fair value
Interest rate swaps
Financial assets at fair value
Financial liabilities at fair value
Group and company
Fair value
2023
£m
Level 1
2023
£m
5.0
–
5.0
–
–
–
Level 2
2023
£m
5.0
–
5.0
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Total
£m
123.8
1.9
99.8
34.9
260.4
Total
£m
123.7
1.8
93.2
33.2
11.3
263.2
Total
£m
156.1
(1.4)
104.1
38.0
296.8
Total
£m
156.1
(1.4)
96.9
36.9
13.2
301.7
Level 3
2023
£m
–
–
–
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
133
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
25. Capital management and financial instruments continued
Fair value
2022
£m
Interest rate swaps
Financial assets at fair value
Financial liabilities at fair value
2.2
(0.3)
1.9
Level 1
2022
£m
–
–
–
Level 2
2022
£m
2.2
(0.3)
1.9
Level 3
2022
£m
–
–
–
Level 1
Fair values measured using quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2
Fair values measured using inputs, other than quoted prices included within Level 1, that are observable for the asset or liability either
directly or indirectly.
Interest rate swaps are accounted for at their fair value, calculated using a discounted cash flow method. Actual and estimated cash flows
are discounted by applying discount factors derived from observable market data and by considering the credit risk.
Level 3
Fair values measured using inputs for the asset or liability that are not based on observable market data.
(e) Financial assets and other financial liabilities
Financial assets and other financial liabilities of the group and the company are not included in this note because their fair value
approximates their carrying value.
(f) Changes in assets and liabilities arising from financing activities
Bank loans
Lease liabilities
Derivative financial instruments
Total net liabilities from financing activities
Bank loans
Lease liabilities
Derivative financial instruments
Total net liabilities from financing activities
Bank loans
Lease liabilities
Derivative financial instruments
Total net liabilities from financing activities
Bank loans
Lease liabilities
Derivative financial instruments
Total net liabilities from financing activities
134 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
At
28 March 2022
£m
133.8
74.0
(1.9)
205.9
At
28 March 2022
£m
133.8
67.7
(1.9)
199.6
At
29 March 2021
£m
173.2
80.2
1.8
255.2
At
29 March 2021
£m
173.2
73.2
1.8
248.2
Group
Cash flow
£m
(30.0)
(7.6)
–
(37.6)
Company
Cash flow
£m
(30.0)
(6.6)
–
(39.7)
Group
Cash flow
£m
(39.9)
(6.6)
–
(46.5)
Company
Cash flow
£m
(39.9)
(5.9)
–
(45.8)
Additions
£m
–
0.4
–
0.4
Additions
£m
–
0.4
–
0.4
Additions
£m
–
1.2
–
1.2
Additions
£m
–
1.2
–
1.2
Other
£m
0.4
4.9
(3.1)
5.3
Other
£m
0.4
4.4
(3.1)
4.8
Other
£m
0.5
(0.8)
(3.7)
(4.0)
Other
£m
0.5
(0.8)
(3.7)
(4.0)
At
3 April 2023
£m
104.2
71.7
(5.0)
170.9
At
3 April 2023
£m
104.2
65.9
(5.0)
165.1
At
28 March 2022
£m
133.8
74.0
(1.9)
205.9
At
28 March 2022
£m
133.8
67.7
(1.9)
199.6
26. Deferred tax
Deferred tax relates to the following:
Deferred tax assets
Decelerated capital allowances
Share based payments
Deferred tax assets
Deferred tax liabilities
Rolled over gains on property revaluations
Retirement benefit schemes
Interest rate swaps – cash flow hedge
Deferred tax liabilities
Group
Company
2023
£m
4.6
0.1
4.7
(107.2)
(0.9)
(1.2)
(109.3)
Restated
2022
£m
3.9
0.2
4.1
(104.8)
(3.0)
(0.5)
(108.3)
2023
£m
4.6
0.1
4.7
(107.0)
(0.9)
(1.2)
(109.1)
Restated
2022
£m
3.9
0.2
4.1
(104.6)
(3.0)
(0.5)
(108.1)
Net deferred tax liabilities
(104.6)
(104.2)
(104.4)
(104.0)
Reconciliation of net deferred tax liabilities:
Opening balance
Tax credit/(charge) in the income statement
Tax charge in the statement of comprehensive income
Adjustment in respect of deferred tax of prior periods
Closing balance
Movements in the deferred tax assets are shown below:
Deferred tax assets
Balance as at 29 March 2021
Charged to the income statement
Charged to other comprehensive income
Brought forward balance transferred out to DTL
Balance as at 28 March 2022
Charged to the income statement
Charged to other comprehensive income
Brought forward balance transferred out to DTL
Balance as at 3 April 2023
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Group
2023
£m
(104.2)
0.5
(2.0)
1.1
(104.6)
2022
£m
(65.0)
(13.6)
(26.4)
0.8
(104.2)
Company
2023
£m
(104.0)
0.5
(2.0)
1.1
(104.4)
2022
£m
(64.8)
(13.6)
(26.4)
0.8
(104.0)
Interest
rate swap
£m
0.6
–
(1.1)
0.5
–
–
–
–
–
Retirement
benefit
scheme
£m
1.2
–
–
(1.2)
–
–
–
–
–
Decelerated
capital
allowances
£m
4.8
(0.9)
–
–
3.9
–
–
(3.9)
–
Capital
losses
£m
0.7
(0.7)
–
–
–
–
–
–
–
Share based
payments
£m
0.3
(0.1)
–
–
0.2
–
–
(0.2)
–
Trade
losses
£m
1.0
(1.0)
–
–
–
–
–
–
–
Total
£m
8.6
(2.7)
(1.1)
(0.7)
4.1
–
–
(4.1)
–
On 3 March 2021, the Chancellor confirmed in his Budget statement that the UK rate of corporation tax would increase to 25% from
1 April 2023. This was substantively enacted on 24 May 2021. Accordingly, the deferred tax assets and liabilities at the balance sheet
date are calculated at the substantively enacted rate of 25%. This amount has been recognised as an adjusting item (see note 11).
The group has realised capital losses of £1.5 million (2022: £1.5 million), which are available indefinitely to offset against future capital
gains. A deferred tax asset has not been recognised in respect of £1.5 million (2022: £1.5 million) of these losses because at present it
is unclear whether suitable gains will arise in the foreseeable future to utilise them. The company utilised its realised capital losses in full
in the year and has no realised capital losses remaining. The group’s tax losses can be carried forward for an unlimited period.
The group has unrealised capital losses of £6.9 million (2022: £5.8 million). No deferred tax asset has been recognised in respect of
these losses (2022: £nil) because it is uncertain whether they will be utilised.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
135
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
27. Retirement benefit schemes
The company operates one defined benefit pension scheme, namely the Young & Co.’s Brewery, P.L.C. Pension Scheme, a defined
contribution pension scheme and a post-retirement health care scheme. The defined benefit scheme is closed to new entrants.
The aggregate contribution to the defined contribution scheme was £1.5 million (2022: £1.6 million) which is recognised as an expense
in the income statement.
Independent, professionally qualified actuarial advice is sought to determine the liabilities arising from the defined benefit scheme, using
the projected unit credit method. The scheme is formally valued every three years. The obligations under the scheme consist mainly of a
final salary scheme which provides members with benefits based on length of service and salary.
Through its defined benefit scheme and post-retirement health care scheme, the group is exposed to a number of risks. For details of
the principal risks and uncertainties, see page 44.
The employer contribution to the defined benefit scheme for the period ended 3 April 2023 was £1.4 million of which £1.2 million
were special contributions (2022: £1.4 million of which £1.2 million were special contributions) plus premiums of £0.2 million
(2022: £0.2 million) to the post-retirement health care scheme. The current arrangement as regards contribution rates specifies that
annual special contributions of £1.2 million will be payable until October 2034.
Future employee contribution rates are projected to be between 8% and 11% of pensionable earnings. Future employer contribution
rates are projected to be 18% of pensionable earnings. The total contributions to the defined benefit scheme in the 2024 financial
period are expected to be £1.4 million which includes a special contribution of £1.2 million. The total contributions to the post-
retirement health care scheme in the 2024 financial period are expected to be £0.2 million.
Financial assumptions
Discount rate
Inflation
Rate of increase in salaries
Discretionary pension increases
Rate of revaluation of deferred pensions
General medical expenses inflation
Mortality assumptions
The life expectancies underlying the valuation are as follows:
Current pensioners (at age 65) – males
Current pensioners (at age 65) – females
Future pensioners (at age 65) – males
Future pensioners (at age 65) – females
Pension
2023
%
4.70
3.20
2.50
3.20
2.70
N/A
2022
%
2.80
3.60
2.50
3.60
3.10
N/A
Health care
2023
%
4.70
N/A
N/A
N/A
N/A
6.00
2023
Years
21.9
24.1
23.2
25.5
2022
%
2.80
N/A
N/A
N/A
N/A
6.00
2022
Years
21.9
24.3
23.3
25.8
At the period end date, the average age of current pensioners was 76 years (2022: 75 years) and for future pensioners was 58 years
(2022: 57 years).
The weighted average duration of liabilities for the current period was 14 years (2022: 17 years).
A one percentage point change in the assumed rate of increase in health care costs would have the following effects:
Effect on the aggregate service cost and interest cost
Effect on the defined benefit obligation
Increase
£m
–
0.1
Decrease
£m
–
(0.1)
The sensitivities regarding the principal assumptions used to measure the schemes’ liabilities are set out below. The illustrations
consider the single change shown with the other assumptions assumed to be unchanged. In practice, changes in one assumption may
be accompanied by changes in another assumption. Changes in market values may also occur at the same time as the changes in
assumptions and may or may not offset them.
136 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Assumption
Discount rate
Rate of inflation
Rate of increase in salary
Discretionary pension increases
Rate of revaluation of deferred pensions
Life expectations
Change in assumption
Impact on scheme liabilities
Increase/decrease by 0.5% Decrease/increase by 7.2%
Increase/decrease by 0.5% Increase/decrease by 5.7%
Increase/decrease by nil
Increase/decrease by 0.5%
Increase/decrease by 0.5% Increase/decrease by 3.4%
Increase/decrease by 0.5% Increase/decrease by 0.9%
Increase by 4.7%
Increase by 1 year
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Pension scheme and health care scheme assets and liabilities
Equities
Diversified growth fund
Corporate bonds
Liability Driven Investment and Asset Backed Securities
Insured pensions
Other
Total fair value of assets
Present value of retirement benefit liabilities
Scheme surplus
Group and company
Assets and liabilities
2023
£m
18.9
9.2
–
55.2
6.3
0.4
90.0
(86.3)
3.7
2022
£m
40.4
19.9
–
56.4
7.7
4.7
129.1
(116.9)
12.2
The company has an unconditional right to the surplus on the scheme and therefore has recognised the pension surplus.
The pension scheme assets include some of the company’s A shares with a fair value of £3.6 million (2022: £4.9 million). There are no
property assets of the scheme occupied by the company.
Of the above assets, £28.1 million (2022: £60.2 million) are quoted securities.
Movement within the schemes in the period
(a) Changes in the present value of the schemes are as follows:
Opening surplus/(deficit)
Current service cost
Contributions
Other finance income/(charge)
Remeasurement through other
comprehensive income
Closing surplus/(deficit)
(b) Recognised in the income statement
Current service cost included
in operating costs
Net interest income/(charge)
Pension
scheme
£m
14.3
(0.3)
1.4
0.4
(10.4)
5.4
Pension
scheme
£m
(0.3)
0.4
2023
Health care
scheme
£m
(2.1)
–
0.2
(0.1)
0.3
(1.7)
2023
Health care
scheme
£m
–
(0.1)
Group and company
Total
£m
12.2
(0.3)
1.6
0.3
(10.1)
3.7
Group and company
Total
£m
(0.3)
0.3
Pension
scheme
£m
(2.2)
(0.4)
1.4
–
15.5
14.3
Pension
scheme
£m
(0.4)
–
2022
Health care
scheme
£m
(3.9)
–
0.2
(0.1)
1.7
(2.1)
2022
Health care
scheme
£m
–
(0.1)
Total
£m
(6.1)
(0.4)
1.6
(0.1)
17.2
12.2
Total
£m
(0.4)
(0.1)
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
137
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
27. Retirement benefit schemes continued
(c) Recognised in the statement of comprehensive income
Experience gains arising on the
schemes' liabilities
Changes in demographic assumptions
underlying the schemes' liabilities
Changes in financial assumptions underlying
the schemes' liabilities
Remeasurement of obligations
Return on schemes’ assets (less amounts
included in the net interest expense)
Net remeasurement recognised
Pension
scheme
£m
2023
Health care
scheme
£m
(1.4)
(0.1)
0.6
30.6
29.8
(40.1)
(10.3)
–
0.3
0.2
–
0.2
Group and company
Total
£m
(1.5)
0.6
30.9
30.0
(40.1)
(10.1)
Pension
scheme
£m
(0.8)
6.3
13.5
19.0
(3.5)
15.5
(d) Movements in the present value of schemes’ obligations during the period
Opening defined benefit obligations
Current service cost
Interest on obligations
Contributions by schemes' members
Remeasurement of obligations
Benefits paid
Present value of schemes' liabilities
Pension
scheme
£m
(114.8)
(0.3)
(3.2)
(0.1)
29.8
4.0
(84.6)
(e) Change in fair value of schemes’ assets
Opening fair value of schemes' assets
Interest on schemes' assets
Return on schemes’ assets (less amounts
included in the net interest expense)
Contributions by employer
Contributions by schemes' members
Benefits paid
Fair value of schemes' assets
Pension
scheme
£m
129.1
3.6
(40.1)
1.3
0.1
(4.0)
90.0
2023
Health care
scheme
£m
(2.1)
–
(0.1)
–
0.3
0.2
(1.7)
2023
Health care
scheme
£m
–
–
–
0.2
–
(0.2)
–
Group and company
Total
£m
(116.9)
(0.3)
(3.3)
(0.1)
30.1
4.2
(86.3)
Group and company
Total
£m
129.1
3.6
(40.1)
1.5
0.1
(4.2)
90.0
Pension
scheme
£m
(134.9)
(0.4)
(2.6)
(0.1)
19.0
4.2
(114.8)
Pension
scheme
£m
132.7
2.6
(3.5)
1.4
0.1
(4.2)
129.1
2022
Health care
scheme
£m
0.9
–
0.8
1.7
–
1.7
2022
Health care
scheme
£m
(3.9)
–
(0.1)
–
1.7
0.2
(2.1)
2022
Health care
scheme
£m
–
–
–
0.2
–
(0.2)
–
Total
£m
0.1
6.3
14.3
20.7
(3.5)
17.2
Total
£m
(138.8)
(0.4)
(2.7)
(0.1)
20.7
4.4
(116.9)
Total
£m
132.7
2.6
(3.5)
1.6
0.1
(4.4)
129.1
28. Lease liabilities
(a) Group as lessee
At inception, the group has lease contracts for various items of property and vehicles used in its operations. Leases of property generally
have lease terms between 20 and 999 years, while motor vehicles generally have lease terms between 3 and 5 years.
138 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
There are several lease contracts that include extension and termination options and variable lease payments, which are further
discussed below.
Set out below are the carrying amounts of lease liabilities and the movements during the period:
At 29 March 2021
Additions
Business combinations
Lease amendments
Accretions of interest
Payments
Lease disposals
At 28 March 2022
Current
Non-current
At 28 March 2022
Additions
Lease amendments
Accretions of interest
Payments
At 3 April 2023
Current
Non-current
Group
£m
80.2
1.0
0.2
0.1
2.5
(6.6)
(3.4)
74.0
4.9
69.1
74.0
0.4
2.4
2.5
(7.6)
71.7
4.8
66.9
Company
£m
73.2
1.0
0.2
0.3
2.3
(5.9)
(3.4)
67.7
4.1
63.6
67.7
0.4
2.0
2.4
(6.6)
65.9
4.0
61.9
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Group cash flow benefits arising from rent concessions totalled £nil in the period (2022: £0.2 million), this includes £nil of rent
deferrals. In the prior period, this also included £0.1 million of rent holidays which were offset against £0.1 million of rent amendments.
There were no rent holidays recognised in the current period.
Under the practical expedient introduced by the amendments to IFRS 16, the lease liability was remeasured using the remeasured
consideration arising out of the rent concession, with a corresponding adjustment to the right-of-use asset. The discount rate was
not updated.
Note 25(c) summarises the maturity profile of the group’s lease liability based on contractual undiscounted payments.
The following amounts have been recognised in the income statement:
Depreciation expense of right-of-use assets (note 20)
Interest expense on lease liabilities (note 13)
Expense relating to short-term leases and low-value assets
Variable lease payments
Total amount recognised in the income statement
Depreciation expense of right-of-use assets (note 20)
Interest expense on lease liabilities (note 13)
Expense relating to short-term leases and low-value assets
Variable lease payments
Total amount recognised in the income statement
Group
2023
53 weeks
£m
6.9
2.5
0.9
0.3
10.6
Group
2022
52 weeks
£m
7.1
2.5
0.6
0.1
10.3
Company
2023
53 weeks
£m
6.0
2.4
0.9
0.2
9.5
Company
2022
52 weeks
£m
6.1
2.3
0.6
0.1
9.1
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
139
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
28. Lease liabilities continued
During the current period the group had total cash outflows for leases of £7.6 million (2022: £6.6 million). The group also had non-
cash additions to right-of-use assets and lease liabilities of £0.4 million (2022: £1.2 million).
The group has lease contracts for properties that contain variable payments based on turnover levels achieved. The following provides
information on the group’s variable lease payments, including the magnitude in relation to fixed payments:
2023
Fixed rent
Variable rent with minimum payment
Variable rent only
2022
Fixed rent
Variable rent with minimum payment
Variable rent only
Fixed payments
53 weeks
£m
6.2
1.4
–
7.6
Fixed payments
52 weeks
£m
5.6
1.0
–
6.6
Group
Variable
payments
53 weeks
£m
–
–
0.3
0.3
Group
Variable
payments
52 weeks
£m
–
–
0.1
0.1
Total payments
53 weeks
£m
6.2
1.4
0.3
7.9
Fixed payments
53 weeks
£m
5.8
0.8
–
6.6
Total payments
52 weeks
£m
5.6
1.0
0.1
6.7
Fixed payments
52 weeks
£m
5.2
0.7
–
5.9
Company
Variable
payments
53 weeks
£m
–
–
0.2
0.2
Total payments
53 weeks
£m
5.8
0.8
0.2
6.8
Company
Variable
payments
52 weeks
£m
–
–
0.1
0.1
Total payments
52 weeks
£m
5.2
0.7
0.1
6.0
The group has several lease contracts that include termination options. These options are negotiated by management to provide
flexibility in managing the leased-asset portfolio and align with the group’s business needs. As at 3 April 2023 the group was not
expecting to exercise any lease termination options.
(b) Group as lessor
During the period, the group received lease income from tenants outside of the managed segment, which were designated as
operating leases. Most of these pubs were disposed of in the prior period and were classified as a discontinued operation (see note 5).
The following amounts have been recognised in the income statement in the current and prior period:
Lease income
Sublease income
Total lease income
2023
53 weeks
Group and company
Discontinued
operations
–
–
–
Continuing
operations
0.3
–
0.3
2022
52 weeks
Group and company
Discontinued
operations
0.4
–
0.4
Continuing
operations
0.6
0.1
0.7
Total
0.3
–
0.3
Total
1.0
0.1
1.1
All lease income is fixed rent. Other revenue received within the tenanted houses operating segment was generated from sales of drink
and accounted for under IFRS 15 Revenue from contracts with customers.
In the prior period, the group offered a rent concession to the majority of the tenanted estate. It was communicated to the tenants that
any rent concessions would be treated as variable rent payments, under which the variable element of rent is taken directly to the profit
and loss statement in the period that it relates to. For the prior period, the rent concessions granted to tenants resulted in foregone
rental income of £0.4 million.
2023
Undiscounted lease income
2022
Undiscounted lease income
Within one
year
£m
0.2
One to two
years
£m
0.2
Two to three
years
£m
0.2
Three to four
years
£m
0.2
Four to five
years
£m
0.1
More than five
years
£m
–
Within one
year
£m
0.4
One to two
years
£m
0.4
Two to three
years
£m
0.3
Three to four
years
£m
0.3
Four to five
years
£m
0.3
More than five
years
£m
0.2
Total
£m
0.9
Total
£m
1.9
140 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
29. Share capital and reserves
Issued and fully paid shares – 12.5p each
Opening balance
Issued under employee share schemes
Closing balance
2023
53 weeks
Shares
2023
53 weeks
£000
2022
52 weeks
Shares
58,476,641
7,961
58,484,602
7,310
1
7,311
58,475,560
1,081
58,476,641
2022
52 weeks
£000
7,310
–
7,310
Of the opening balance, 34,405,886 are A shares and 24,070,755 are non-voting shares (2022: 34,404,805 A shares, 24,070,755
non-voting shares). Of the closing balance, 34,413,847 are A shares and 24,070,755 are non-voting shares (2022: 34,405,886
A shares, 24,070,755 non-voting shares).
For details of the shares issued in the current period under employee share schemes, see share awards (note 30).
The two classes of shares are equal in all respects except that the non-voting shares do not carry the right to receive notices of,
or to attend, speak or vote at general meetings.
Share premium account
The share premium account represents the excess of proceeds received over the nominal value of new shares issued.
Capital redemption reserve
The capital redemption reserve arose from the repurchase and subsequent cancellation of ordinary share capital. The balance represents
the nominal amount of the share capital cancelled.
Hedging reserve
Hedging reserve adjustments arise from the movement in fair value of the group’s derivative instruments used as an effective hedge.
Revaluation reserve
The revaluation reserve represents unrealised gains generated on the property estate from annual property valuations. It arises from
the surplus of fair value over the original cost, net of any associated deferred taxation.
Retained earnings
Retained earnings consists of cumulative historic realised gains and losses net of dividends paid. It also includes a non-distributable
reserve of £17.1 million (2022: £16.4 million) arising on the transfer of assets from subsidiaries to the parent at consolidated book
value, and a non-distributable reserve of £33.6 million (2022: £33.6 million) arising from the transfer of revaluation reserves relating
to leasehold assets following the adoption of IFRS 16.
F
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30. Share awards
The group operated three types of share based payment arrangements during the period ended 3 April 2023: an executive director/
senior management employee deferred annual bonus (‘DAB’) scheme; a long term incentive plan (‘LTIP’); and a Save-As-You-Earn
(‘SAYE’) scheme.
(a) DAB scheme
This scheme is designed to incentivise the executive directors to deliver long-term superior shareholder returns.
During the period ended 3 April 2023, the remuneration committee decided that in view of the introduction of the LTIP (see (b) LTIP)
the operation of the DAB scheme would change for that period and for future awards. The DAB scheme operated as an annual bonus
scheme, which requires executive directors to defer up to 25% of their annual bonus (net of tax, duties, or social security contributions)
subject to certain thresholds being met. During the prior period, Mike Owen, Simon Dodd and Tracy Dodd were required to defer
25% of their annual bonus (net of tax, duties or social security contributions) into shares which are subject to a holding period of three
years. Patrick Dardis, who retired as an executive director on 30 September 2022, received his annual bonus in cash. Matching shares
will no longer be awarded under the DAB scheme.
The following table summarises, at 28 March 2022 and at 3 April 2023, the outstanding entitlements to A shares under the DAB
scheme of the directors who served during the period ended 3 April 2023 and other senior management employees. All shares listed
in the table are registered in the relevant individual’s name and, save for those shares which were transferred during the period, are fully
vested. In total, 7,961 A shares were awarded during the period, and the weighted fair value of the A shares awarded during the period
was 1,304 pence per share.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
141
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
30. Share awards continued
Patrick Dardis
Torquil Sligo-Young
Tracy Dodd
Simon Dodd
Mike Owen
Senior management3
Date
of award
June 2019
June 2019
June 2019
June 2019
June 2019
June 2019
May 2022
May 2022
May 2022
June 2019
June 2019
Matching
shares
(Y/N)
At
28 March
2022
N 21,671
10,835
Y
6,371
N
3,185
Y
4,682
N
780
Y
–
N
–
N
–
N
3,586
N
5,143
Y
Awarded
during
the period
–
–
–
–
–
–
2,080
2,276
3,605
–
–
Restrictions
ceased to
apply during
the period
(21,671)
(5,417)
(6,371)
(1,592)
(4,682)
(390)
–
–
–
(3,586)
(2,569)
Transferred
during
period1
–
(5,418)
–
(1,593)
–
(390)
–
–
–
–
(2,574)
At
3 April
2023
–
–
–
–
–
–
2,080
2,276
3,605
–
–
Issue
price
(pence
per share)2
1,765.0
12.5
1,765.0
12.5
1,765.0
12.5
1,304.0
1,304.0
1,304.0
1,765.0
12.5
1 These shares were transferred to the Ram Brewery Trust II, an employee benefit trust designated by the company.
2 For ‘matching’ shares, the price shown is the nominal value.
3 Mark Loughborough was appointed to the board on 30 September 2022, which was after the date of any transfers.
(b) LTIP
In order to incentivise and retain executive directors and other senior management employees, the company adopted the LTIP during
the period ended 3 April 2023. The LTIP is designed to align remuneration with both the company’s long-term financial performance
and the interests of shareholders, and has replaced the DAB scheme.
The LTIP enables the company to make awards of shares to selected employees which then vest at a later date, subject to the
achievement of specified performance or other conditions determined by the remuneration committee at the time of grant, with the
performance conditions to be satisfied over a specified performance period. Any employee (including an executive director) of the
group may be selected to participate in the LTIP. Awards may be granted under the LTIP in the form of nil cost options over the
company’s ordinary shares. Participants are not required to make any payment in exchange for the grant of an award under the LTIP.
The first and only grant of awards under the LTIP during the period ended 3 April 2023 took place on 29 June 2022. In total, 122,719
A shares were granted in the form of nil cost options and no monetary consideration was paid for the awards. The awards are subject to
performance conditions which are based: (1) two-thirds on the extent to which the company’s adjusted earnings per share in respect of
the financial year ended on or around 31 March 2025 exceed the same measure for the financial period ended 28 March 2022; and
(2) one-third on total shareholder return (TSR) relative to a comparator group of the company’s peers. The awards will vest and become
exercisable subject to continued employment with the company and the extent to which performance conditions are met. Ordinarily,
the awards will vest on 29 June 2025.
The awards granted to the executive directors were equivalent to 100% of basic salary for Patrick Dardis and Mike Owen, and 75%
of basic salary for Simon Dodd and Tracy Dodd. Mark Loughborough’s award was granted when he was a member of the senior
management team, prior to him being appointed as an executive director. His award was equivalent to 50% of his basic salary at
the time.
Simon Dodd
Mike Owen
Tracy Dodd
Mark Loughborough
Patrick Dardis1
Date
of award
29.06.22
29.06.22
29.06.22
29.06.22
29.06.22
At
28 March
2022
–
–
–
–
–
Granted
during
the period
15,127
25,548
13,823
3,118
39,241
Lapsed
during
the period
–
–
–
–
–
At
3 April
2023
15,127
25,548
13,823
3,118
39,241
Share price
on date
of award
1,172p
1,172p
1,172p
1,172p
1,172p
Exercise
price
0p
0p
0p
0p
0p
Date from
which
exercisable
29.06.25
29.06.25
29.06.25
29.06.25
29.06.25
Expiry
date
29.06.32
29.06.32
29.06.32
29.06.32
29.06.32
1 The committee determined at its meeting on 17 May 2023 that the award granted to Patrick Dardis be pro-rated to 31 March 2023, the date he retired from the company as a good leaver. His 2022
LTIP award has been pro-rated and reduced from 39,241 A shares to 13,139 A shares, and 26,102 A shares have lapsed. His award will ordinarily be exercisable from 29 June 2025, subject to the
extent to which the performance conditions are met..
142 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
The following table summarises, at 28 March 2022 and at 3 April 2023, the outstanding entitlements to A shares under the LTIP:
At 28 March 2022
Granted
Exercised
Lapsed
At 3 April 2023
LTIP
Number
–
122,719
–
–
122,719
The fair value of the share options was estimated at the grant date based on the performance conditions in place. One-third of the
award is subject to a market based performance condition, and the probability of meeting this performance condition has been
incorporated into the calculation of the estimated fair value at the grant date using a Monte Carlo valuation model. Two-thirds of the
award are subject to a non-market based performance condition. This portion of the award has been valued at the market price of
shares at the grant date of 1,140 pence per share. The company has made an estimate of the likelihood of meeting this performance
condition and incorporated this into the number of awards expected to vest. This estimate will be updated at each reporting date.
The following information is relevant in the determination of the fair value of share options granted during the year under the equity-
settled LTIP scheme operated by the group:
Valuation model used
Fair values at the measurement date (pence)
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of share options (years)
Weighted average share price (pence)
2023
LTIP – TSR portion
Monte Carlo
860.0
nil
43.6
2.1
3
1,047.0
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The expected volatility reflects the assumption that the company’s daily historical volatility over a three year period prior to the date of
grant is indicative of expected future volatility.
The share based payment expense recognised during the year is shown in the following table:
Expense arising from equity-settled share based payment transactions
There were no cancellations or modifications to the awards during the period.
2023
£m
0.4
2022
£m
–
(c) SAYE scheme
This scheme enables eligible directors and employees to acquire options over the company’s A shares. The options can be granted
at a discount of up to 20% of the market price of an A share at the time invitations to join the scheme for the relevant year are issued,
with the proceeds of a related SAYE savings contract then being used to acquire shares at a later date, if the option holders choose
to do so. All employees who have worked for the minimum qualifying period on an invitation date are eligible to join the scheme.
Options granted under the scheme are not subject to performance conditions other than continued employment. These options are
all equity-settled. During the period ended 3 April 2023, the company adopted a new set of rules for its SAYE scheme, to bring it
into line with the latest legislation. The adoption of the new set of rules has not materially altered the operation of the SAYE.
In the current period, 119,284 options over A shares (2022: 130,746 A shares) were granted under the scheme at an exercise price
of 931 pence per share.
Options over 143,429 A shares were outstanding at the beginning of the period. During the period, options over 86,587 A shares
lapsed, options over 263 A shares were exercised at 1,412p per share. The weighted average share price of options exercised during
the period was 1,412 pence (2022: 1,526 pence). The options that were exercised (and in respect of which new shares were issued)
resulted in an increase in share capital of £nil (2022: £135.125) and an increase in share premium of £nil (2022: £14,728.995).
A charge of £0.1 million (2022: £0.1 million), valued using the Black-Scholes option pricing model, was made to the group and
company income statements in respect of these options in the period. The cumulative fair value of the share options outstanding
at 3 April 2023 was £0.5 million (2022: £0.1 million). Options over 175,863 A shares were outstanding at the end of the period.
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
143
Financial Statements
Notes to the financial statements continued
For the 53 weeks ended 3 April 2023
30. Share awards continued
Valuation assumptions
Assumptions used in the Black-Scholes model to determine the fair value of share options at grant date for the period ending 3 April
2023 were as follows:
Share price at grant date (pence)
Exercise price (pence)
Expected volatility (%)
Option life (years)
Expected dividends (expressed as dividend yield %)
Risk-free interest rate (%)
Probability of forfeiture (%)
2023 plan
1,164.0
931.0
53.3
3
1.9
3.1
7.0
Group and company
2022 plan
1,470.0
1,176.0
51
3
1.3
1.7
47.9
2019 plan
1,765.0
1,412.0
24.9
3
0.9
0.3
72.8
2018 plan
1,705.0
1,364.0
21.0
3
1.3
0.7
64.0
Volatility is based on the standard deviation of an A share of Young & Co.’s Brewery, P.L.C. over the three years prior to the grant date,
adjusted for management’s view of future volatility of share price. The assumed volatility may not necessarily be the actual outcome.
31. Related party transactions
Directors
Directors’ emoluments and retirement benefits are disclosed in notes 9(b) and (c). Directors’ interests in the company’s share capital are
disclosed or referred to on page 82 and in notes 9(e) and 30. No other transactions requiring disclosure have been entered into with
the directors.
Pension scheme and other trust
The Young & Co.’s Brewery, P.L.C. Pension Scheme provides pensions and other benefits to employees of the group and certain other
individuals. It is managed by a corporate trustee, Young’s Pension Trustees Limited. Torquil Sligo-Young, a non-executive director of the
company, and two other individuals, neither of whom are a director of the company, are the directors of the pension trustee company.
At 3 April 2023, the scheme held 337,067 A shares (2022: 337,067), being 0.98% of the class. In March 2018, the company granted
a charge over two of its pubs as security for its obligation to make payments to the scheme: the company felt it was appropriate to
agree to this so as to demonstrate its commitment to the scheme and to provide the pension trustee company with greater comfort
as to the security of the scheme. The charge was based on a standard form document issued by the Pension Protection Fund.
The Ram Brewery Trust II holds assets for the benefit of employees and former employees. It is managed by a corporate trustee,
RBT II Trustees Limited. During the period, three individuals, neither of whom were a director of the company, were the directors
of the employee benefit trustee company. At 3 April 2023, the trust held 14,479 A shares (2022: 5,819), being 0.02% of the class.
During the period:
• 3,429 A shares (2022: 18,486) were transferred from the trust in connection with the company’s savings-related share option
scheme (see note 9(d));
• 12,089 A shares (2022: 15,639) were transferred to the trust in connection with the company’s deferred annual bonus scheme
(see note 30(a)).
Neither the pension trustee company nor the employee benefit trustee company is a related party of the company for the purposes
of the AIM Rules for Companies.
Key management
The group considers key management personnel to be solely the directors of the company as they are the only ones with authority and
responsibility for planning, directing and controlling the activities of the group. The compensation provided to the directors is detailed
in note 9; in addition, the group made employers’ national insurance contributions of £0.5 million (2022: £0.2 million) and incurred
a share based payment charge of £0.5 million (2022: £0.1 million).
144 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
32. Net cash generated from operations and analysis of net debt
Profit before tax from continuing operations
Profit before tax from discontinued operations
Profit before tax
Net finance cost
Finance charge for pension obligations
Operating profit
Depreciation of property and equipment (note 19)
Depreciation of right-of-use assets (note 20)
Movement on revaluation of properties (note 19)
Net profit on disposal of property
Difference between pension service cost and cash contributions paid
Share based payments
Movements in working capital
– Inventories
– Receivables
– Payables
Net cash generated from operations
Analysis of net debt
Cash
Current borrowings and loan capital
Current lease liability
Non-current borrowings and loan capital
Non-current lease liability
Net debt
Group
2023
53 weeks
£m
36.2
–
36.2
7.5
(0.3)
43.4
26.2
6.9
7.0
–
(1.3)
(0.5)
(0.7)
(0.6)
3.4
83.8
Group
2023
£m
10.7
–
(4.8)
(104.2)
(66.9)
(165.2)
2022
52 weeks
£m
42.1
9.8
51.9
9.5
0.1
61.5
24.4
7.1
(0.8)
(11.4)
(1.2)
(0.1)
(2.0)
1.5
28.0
107.0
2022
£m
34.0
(30.0)
(4.9)
(103.8)
(69.1)
(173.8)
Company
2023
53 weeks
£m
38.2
–
38.2
7.3
(0.3)
45.2
26.0
6.0
7.0
–
(1.3)
(0.5)
(0.7)
0.2
0.7
82.6
Company
2023
£m
10.7
–
(4.0)
(104.2)
(61.9)
(159.4)
2022
52 weeks
£m
42.0
9.8
51.8
9.6
0.1
61.5
24.2
6.1
(0.8)
(11.4)
(1.2)
(0.1)
(2.0)
1.6
28.4
106.3
2022
£m
34.0
(30.0)
(4.1)
(103.8)
(63.6)
(167.5)
F
i
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s
33. Post balance sheet events
There were two post balance sheet events: the exchange of contracts and completion of the Stag (Belsize Park) for a total cash
consideration of £3.3 million, and the final extension of the £50.0 million syndicated facility with NatWest and HSBC by a further
year (the second year of a two-year option to extend) to 19 May 2027.
34. Contingent liabilities
There were no contingent liabilities at the current or prior period balance sheet date.
Young & Co.’s Brewery, P.L.C.
Copper House, 5 Garratt Lane
Wandsworth, London SW18 4AQ
Telephone: 020 8875 7000
Fax: 020 8875 7100
www.youngs.co.uk
Registered in England number 00032762
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
145
Shareholder Information
Notice of meeting
If you hold any A shares this notice is important and requires your immediate attention. If you are in any doubt as to the action
you should take, you should immediately consult your stockbroker, solicitor, accountant or other duly authorised professional
adviser. If you have sold or otherwise transferred all your shares, please forward this annual report and any accompanying
documents (except any personalised proxy form, if applicable) to the purchaser or transferee, or to the person through whom
the sale or transfer was arranged, so they can forward this to the person who now holds the shares.
If you hold any A shares, you should have received a proxy form for use in respect of the meeting. Guidance notes on how to complete
it, and on other matters, are given on the form itself and in the notes to this notice. Whether or not you propose to attend the meeting,
please complete and submit the proxy form; it must be received by Computershare Investor Services PLC by 11.30am on Tuesday,
4 July 2023. Appointing a proxy does not stop you from attending the meeting and voting. An attendance and poll card is attached
to the proxy form; please bring this with you to the meeting.
If you do not hold any A shares, this notice is for information purposes only.
Notice is hereby given that the 134th annual general meeting (‘AGM’) of Young & Co.’s Brewery, P.L.C. (the ‘Company’) will be held
in the Civic Suite in Wandsworth Town Hall, Wandsworth High Street, Wandsworth, London SW18 2PU on Thursday, 6 July 2023 at
11.30am. Resolutions 1 to 13 will be proposed as ordinary resolutions, and resolutions 14 to 16 will be proposed as special resolutions.
All A shareholders are asked to vote on these resolutions in advance of the AGM by filling in the accompanying proxy form.
The directors consider that all the resolutions to be put to the meeting are in the best interests of the Company and its shareholders as a whole
and unanimously recommend that all A shareholders vote in favour of them as they intend to do in respect of their beneficial holdings.
Annual accounts and reports
1. To receive the Company’s annual
accounts for the financial year ended
3 April 2023, together with the
strategic report, directors’ report and
the auditor’s report on those accounts
and reports.
Final dividend
6. To resolve that Mike Owen be, and is
hereby, re-appointed as a director.
7. To resolve that Tracy Dodd be, and is
hereby, re-appointed as a director.
8. To resolve that Nick Miller be, and is
hereby, re-appointed as a director.
9. To resolve that Mark Loughborough
be, and is hereby, re-appointed as
a director.
2. To declare a final dividend of 10.26p
per share for the financial year ended
3 April 2023.
10. To resolve that Sarah Sergeant
be, and is hereby, re-appointed as
a director.
Auditor appointment
3. To resolve that Ernst & Young LLP
Political donations
and expenditure
be, and is hereby, re-appointed as the
Company’s auditor to hold office until
the conclusion of the next general
meeting of the Company at which
the Company’s annual accounts
and reports are laid in accordance
with section 437 of the Companies
Act 2006.
Auditor remuneration
4. To resolve that the directors be,
and are hereby, authorised to
determine the remuneration of the
Company’s auditor.
Re-appointment of directors
5. To resolve that Simon Dodd be, and is
hereby, re-appointed as a director.
11. To resolve that the Company and
all companies that are subsidiaries
of the Company at any time during
the period for which this resolution
has effect be, and are hereby,
authorised to:
(a) make political donations to political
parties, not exceeding £50,000
in total;
(b) make political donations to political
organisations other than political
parties, not exceeding £50,000 in
total; and
(c) incur political expenditure, not
exceeding £50,000 in total;
in each case at any time during the
period starting with the date this
resolution is passed and ending at
the end of next year’s annual general
meeting (or, if earlier, at 11.59pm on
30 September 2024) but the aggregate
amount of political donations and
political expenditure that may be made
and incurred by the Company and its
subsidiaries pursuant to this authority
must not exceed £50,000.
Note: for the purposes of this resolution,
‘political donation’ has the meaning
given in section 364 of the Companies
Act 2006, ‘political expenditure’ has the
meaning given in section 365 of the
Companies Act 2006, and reference
to a ‘political party’ or to a ‘political
organisation’ is to a party or to an
organisation to which Part 14 of the
Companies Act 2006 applies.
Increased limit on the
amount payable in respect
of directors’ fees
12. That, for the purposes of article
52(A) of the Company’s articles of
association, a higher sum of £500,000
be, and is hereby, decided.
Directors’ authority
to allot shares etc.
13. To resolve that the directors be,
and are hereby, generally and
unconditionally authorised to allot
shares in the Company and to grant
rights to subscribe for or convert any
security into shares in the Company:
146 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
(a) up to a nominal amount of
£2,436,858 (such amount to be
reduced by any allotments or
grants made under paragraph (b)
below in excess of such sum); and
(b) comprising equity securities (as
defined in section 560(1) of the
Companies Act 2006) up to a
nominal amount of £4,873,716
(such amount to be reduced by
any allotments or grants made
under paragraph (a) above) in
connection with an offer by way of
a rights issue:
(i) to ordinary shareholders in
proportion (as nearly as may
be practicable) to their existing
holdings; and
(ii) to holders of other equity
securities as required by the
rights of those securities or
as the directors otherwise
consider necessary,
and so that the directors may
impose any limits or restrictions and
make any arrangements which they
consider necessary or appropriate
to deal with treasury shares,
fractional entitlements, record
dates, legal, regulatory or practical
problems in, or under the laws of,
any territory or any other matter,
such authority to apply until the
end of next year’s annual general
meeting (or, if earlier, until 11.59pm on
30 September 2024) but, in each case,
during this period the Company may
make offers and enter into agreements
which would, or might, require shares
to be allotted or rights to subscribe
for or convert securities into shares to
be granted after the authority ends
and the directors may allot shares or
grant rights to subscribe for or convert
securities into shares under any such
offer or agreement as if the authority
had not ended.
Disapplication of
pre-emption rights
14. To resolve that, if resolution 13 is
passed, the directors be, and are
hereby, given power to allot equity
securities (as defined in the Companies
Act 2006) for cash under the authority
given by that resolution and/or to
sell shares held by the Company as
treasury shares for cash as if section
561 of the Companies Act 2006 did
not apply to any such allotment or
sale, such power to be limited:
(a) to the allotment of equity securities
and sale of treasury shares in
connection with an offer of, or
invitation to apply for, equity
securities (but in the case of the
authority granted under paragraph
(b) of resolution 13, by way of a
rights issue only):
(i) to ordinary shareholders in
proportion (as nearly as may
be practicable) to their existing
holdings; and
(ii) to holders of other equity
securities, as required by the
rights of those securities, or
as the directors otherwise
consider necessary,
and so that the directors may
impose any limits or restrictions
and make any arrangements
which they consider necessary or
appropriate to deal with treasury
shares, fractional entitlements,
record dates, legal, regulatory or
practical problems in, or under the
laws of, any territory or any other
matter; and
(b) in the case of the authority granted
under paragraph (a) of resolution
13 and/or in the case of any sale
of treasury shares, to the allotment
of equity securities or sale of
treasury shares (otherwise than
under paragraph (a) above of this
resolution 14) up to a nominal
amount of £731,057; and
(c) to the allotment of equity securities
or sale of treasury shares (otherwise
than under paragraph (a) or (b)
above of this resolution 14) up to
a nominal amount equal to 20 per
cent. of any allotment of equity
securities or sale of treasury shares
from time to time under paragraph
(b) above of this resolution 14, such
authority to be used only for the
purposes of making a ‘follow-on
offer’ which the directors determine
to be of a kind contemplated by
paragraph 3 of Section 2B of
the Statement of Principles on
Disapplying Pre-Emption Rights
most recently published by the Pre-
Emption Group prior to the date of
this notice,
such power to apply until the end
of the next annual general meeting
(or, if earlier, until 11.59pm on
30 September 2024) but, in each case,
during this period the Company may
make offers and enter into agreements
which would, or might, require equity
securities to be allotted (and treasury
shares to be sold) after the power ends
and the directors may allot equity
securities (and sell treasury shares)
under any such offer or agreement as
if the power had not ended.
15. To resolve that, if resolution 13 is
passed, the directors be, and are
hereby, given the power in addition to
any power granted by resolution 14, to
allot equity securities (as defined in the
Companies Act 2006) for cash under
the authority given by paragraph (a)
of resolution 13 and/or to sell shares
held by the Company as treasury
shares for cash as if section 561 of the
Companies Act 2006 did not apply to
any such allotment or sale, such power
to be:
(a) limited to the allotment of equity
securities or sale of treasury
shares up to a nominal amount of
£731,057, such power to be used
only for the purposes of financing
(or refinancing, if the authority is to
be used within 12 months after the
original transaction) a transaction
which the directors determine to be
an acquisition or a specified capital
investment of a kind contemplated
by the Statement of Principles on
Disapplying Pre-Emption Rights
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
147
Shareholder Information
Notice of meeting continued
most recently published by the Pre-
Emption Group prior to the date of
this notice; and
(b) limited to the allotment of equity
securities or sale of treasury shares
(otherwise than under paragraph
(a) above) up to a nominal amount
equal to 20 per cent. of any
allotment of equity securities or sale
of treasury shares from time to time
under paragraph (a) above, such
authority to be used only for the
purposes of making a ‘follow-on
offer’ which the directors determine
to be of a kind contemplated by
paragraph 3 of Section 2B of
the Statement of Principles on
Disapplying Pre-Emption Rights
most recently published by the Pre-
Emption Group prior to the date of
this notice,
such power to apply until the end of
next year’s annual general meeting
(or, if earlier, until 11.59pm on
30 September 2024) but, in each case,
during this period the Company may
make offers and enter into agreements
which would, or might, require equity
securities to be allotted (and treasury
shares to be sold) after the power ends
and the directors may allot equity
securities (and sell treasury shares)
under any such offer or agreement as
if the power had not ended.
Authority to purchase
own shares
16. To resolve that the Company be, and
is hereby, authorised for the purposes
of section 701 of the Companies Act
2006 to make one or more market
purchases (as defined in section 693(4)
of the Companies Act 2006) of its
shares of 12.5p each, provided that:
(a) the maximum number of shares
hereby authorised to be purchased
(which may be all A shares, all
Non-Voting shares or a mix) is
5,858,460;
(b) the minimum price, exclusive of
expenses, which may be paid for
a share is 12.5p; and
(c) the maximum price, exclusive of
expenses, which may be paid for
a share is the highest of:
(i) an amount equal to 5% above
the average of the middle
market quotations for a share
of that class as derived from
the AIM appendix to the Daily
Official List of the London Stock
Exchange for the five business
days immediately preceding
the day on which that share is
contracted to be purchased; and
(ii) the higher of the price of the
last independent trade and the
highest current independent bid
on the trading venues where the
purchase is carried out at the
relevant time,
such authority to apply until the
end of next year’s annual general
meeting (or, if earlier, until 11.59pm
on 30 September 2024) but during
this period the Company may enter
into a contract to purchase shares
which would, or might, be completed
or executed wholly or partly after
the authority ends and the Company
may purchase shares pursuant to any
such contract as if the authority had
not ended.
By order of the board
Chris Taylor
Company Secretary
24 May 2023
Registered office:
Copper House
5 Garratt Lane
Wandsworth
London
SW18 4AQ
Registered in England and Wales
No. 32762
Important notes regarding your general
rights as a shareholder and your right to
appoint a proxy and voting can be found
in the next column and on pages 149 to
150 of this document.
Notes
Entitlement to attend, speak
and vote at the meeting
To be entitled to attend, speak and vote
at the meeting (and for the purpose of
determining the number of votes you
may cast), your name must be entered
in that part of the register of members
relating to holders of A shares at close of
business on Tuesday, 4 July 2023 (or, in
the event of any adjournment, at close of
business on the day before the day of the
adjourned meeting).
What you need to bring
If you come to the meeting, please bring
with you the attendance card attached to
the proxy form.
Appointment of proxies
If you hold any A shares, you may appoint
a proxy to exercise all or any of your
rights to attend and to speak and vote
on your behalf at the meeting. You can
do this by completing the proxy form
which came with this document. If you
did not receive a proxy form and believe
that you should have one, or if you
require additional forms, please contact
the Company or its registrar. To be valid,
your proxy form must be received by the
Company’s registrar no later than 11.30
am on Tuesday, 4 July 2023.
Who to appoint as a proxy
A proxy does not have to be a member
of the Company but must attend the
meeting to represent you and for your
vote to be counted. Your proxy could be
the chair of the meeting, a director of the
Company or another person who has
agreed to attend the meeting to represent
you. If you appoint a proxy, you may still
attend the meeting and vote in person,
but in that case your proxy appointment
will automatically terminate.
148 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Multiple proxies
You may appoint more than one proxy
in relation to the meeting provided each
proxy is appointed to exercise the rights
attached to a different A share or different
A shares held by you. A space has been
included in the proxy form to allow you to
specify the number of A shares in respect
of which that proxy is appointed. If you
return the proxy form duly executed but
leave this space blank, you will be deemed
to have appointed the proxy in respect of
all of your holding of A shares. If you wish
to appoint more than one proxy in respect
of your A shares, you should contact the
Company or its registrar for further proxy
forms or photocopy the form as required;
you should also read the notes on the
proxy form relating to the appointment of
multiple proxies.
The following principles apply in relation
to the appointment of multiple proxies:
(a) The Company will give effect to your
intentions and include votes wherever
and to the fullest extent possible.
(b) Where a proxy does not state the
number of A shares to which it applies
(a ‘blank proxy’) then, subject to the
following principles where more than
one proxy is appointed, that proxy
is deemed to have been appointed
in relation to the total number of A
shares registered in your name (‘your
entire holding’). If there is a conflict
between a blank proxy and a proxy
which does state the number of A
shares to which it applies (a ‘specific
proxy’), the specific proxy will be
counted first, regardless of the time
it was sent or received (on the basis
that as far as possible the conflicting
forms of proxy should be judged to
be in respect of different A shares)
and remaining A shares will be
apportioned to the blank proxy (pro
rata if there is more than one).
(c) Where there is more than one proxy
appointed and the total number of
A shares in respect of which proxies
are appointed is no greater than your
entire holding, it is assumed that
proxies are appointed in relation to
different A shares, rather than
conflicting appointments being made
in relation to the same A shares;
that is, there is only assumed to be a
conflict where the aggregate number
of A shares in respect of which proxies
have been appointed exceeds your
entire holding.
(d) When considering conflicting proxies,
later proxies will prevail over earlier
proxies, and which proxy is later will
be determined on the basis of which
proxy is last sent (or, if the Company
is unable to determine which is last
sent, last received). Proxies in the same
envelope will be treated as sent and
received at the same time to minimise
the number of conflicting proxies.
(e) If conflicting proxies are sent or
received at the same time in respect of
(or deemed to be in respect of) your
entire holding, none of them
will be treated as valid.
(f) Where the aggregate number of A
shares in respect of which proxies are
appointed exceeds your entire holding
and it is not possible to determine
the order in which they were sent
or received (or they were all sent
or received at the same time), the
Company’s registrar or the Company
will take steps to try to clarify the
situation with you should time permit.
If this is not possible, none of your
proxies will be treated as valid.
(g) If you appoint a proxy or proxies and
then decide to attend the meeting
in person and vote in person, then
the vote in person will override any
proxy vote. If the vote in person is on
a poll and is in respect of your entire
holding then all proxy votes will be
disregarded. If, however, you vote at
the meeting on a poll in respect of
less than your entire holding, then if
you indicate on your poll card that all
proxies are to be disregarded, that
shall be the case; but if you do not
specifically revoke proxies, then the
vote in person will be treated in the
same way as if it were the last received
proxy and earlier proxies will only be
disregarded to the extent that to count
them would result in the number
of votes being cast exceeding your
entire holding.
(h) In relation to paragraph (g), if you
do not specifically revoke proxies, it
will not be possible for the Company
to determine your intentions in this
regard. However, in light of the aim
to include votes wherever and to
the fullest extent possible, it will be
assumed that earlier proxies should
continue to apply to the fullest
extent possible.
Changing proxy instructions
To change your proxy instructions, you
need to submit a new proxy appointment
– further copies can be obtained from
the Company or its registrar. However,
in doing so, you should be aware of the
principles that apply to multiple proxies –
see the note headed Multiple proxies.
If you are in any doubt as to what to do
where you wish to change your proxy
instruction, please contact the Company’s
registrar or your stockbroker, solicitor,
accountant or other duly authorised
professional adviser.
Termination of proxy
appointments
If you wish to revoke your proxy
instruction, you must send to the
Company’s registrar a signed hard copy
notice clearly stating your intention to
revoke your proxy appointment. If you
are a corporation, the revocation notice
must be executed under your common
seal or signed on your behalf by an officer
of you or an attorney for you. Any power
of attorney or any other authority under
which the revocation notice is signed (or
a notarially certified copy of such power
or authority) must be included with the
revocation notice. The revocation notice
must be received by the Company’s
registrar before the start of the meeting.
If you attempt to revoke your proxy
appointment but the revocation is received
after the time specified then, subject as
follows, your proxy appointment will
remain valid. Appointing a proxy does not
stop you from attending the meeting and
voting. If you appoint a proxy and attend
the meeting, your proxy appointment will
automatically be terminated.
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
149
Total voting rights
As at 19 May 2023, the Company’s
issued share capital comprised
34,413,847 A shares with voting rights
and 24,070,755 non-voting shares with
no voting rights. The Company holds no
shares in treasury. The total number of
voting rights in the Company is therefore
34,413,847.
Communication
Any address or number used for
the purpose of sending or receiving
documents or information by electronic
means that is referred to in the Company’s
2023 annual report or any proxy form
for the Company’s 134th annual general
meeting may not be used to communicate
with the Company for any purpose other
than any expressly stated.
Shareholder Information
Notice of meeting continued
CREST electronic proxy
appointments
CREST members who wish to appoint
a proxy or proxies through the CREST
electronic proxy appointment service
may do so by using the procedures
described in the CREST Manual (available
via www.euroclear.com). CREST personal
members or other CREST sponsored
members, and those CREST members
who have appointed (a) voting service
provider(s), should refer to their CREST
sponsor or voting service provider(s), who
will be able to take the appropriate action
on their behalf.
In order for a proxy appointment or
instruction made using the CREST service
to be valid, the appropriate CREST
message (a ‘CREST Proxy Instruction’)
must be properly authenticated in
accordance with the specifications of
Euroclear UK & International Limited
(‘Euroclear’) and must contain the
information required for such instructions,
as described in the CREST Manual.
The message, regardless of whether it
constitutes the appointment of a proxy
or is an amendment to the instruction
given to a previously appointed proxy
must, in order to be valid, be transmitted
so as to be received by the issuer’s agent
(ID 3RA50) by no later than 11:30 am
on Tuesday, 4 July 2023 or, in the event
of an adjournment, 48 hours before the
adjourned time. For this purpose, the time
of receipt will be taken to be the time (as
determined by the timestamp applied to
the message by the CREST Applications
Host) from which the issuer’s agent is able
to retrieve the message by enquiry to
CREST in the manner required by CREST.
After this time, any change of instructions
to proxies appointed through CREST
should be communicated to the appointee
through other means.
CREST members and, where applicable,
their CREST sponsors or voting service
providers should note that Euroclear does
not make available special procedures
in CREST for any particular message.
Normal system timings and limitations
will therefore apply in relation to the
input of CREST Proxy Instructions. It is
the responsibility of the CREST member
concerned to take (or, if the CREST
member is a CREST personal member
or sponsored member or has appointed
a voting service provider(s), to procure
that his CREST sponsor or voting service
provider(s) take(s)) such action as shall
be necessary to ensure that a message
is transmitted by means of the CREST
system by any particular time. In this
connection, CREST members and, where
applicable, their CREST sponsors or voting
service providers are referred, in particular,
to those sections of the CREST Manual
concerning practical limitations of the
CREST system and timings.
The Company may treat as invalid
a CREST Proxy Instruction in the
circumstances set out in Regulation
35(5)(a) of the Uncertificated Securities
Regulations 2001 (as amended).
Corporate representatives
If you are a corporation, you may appoint
one or more corporate representatives
who may exercise on your behalf all your
powers as a member provided they do
not do so in relation to the same A shares.
Name and address of the
Company’s registrar
The Company’s registrar is
Computershare Investor Services PLC.
They can be contacted via post at
the following address: The Pavilions,
Bridgwater Road, Bristol, BS99 6ZZ.
Their telephone number is 0370
707 1420.
Display documents
The following will be available for
inspection at the Company’s registered
office during normal business hours
(Saturdays, Sundays and public holidays
excepted) from the date of this notice until
10.00 am on the day of the meeting:
• copies of the executive directors’ service
contracts; and
• copies of the letters of appointment
of the non-executive directors.
After 10.00 am on the day of the
meeting, these documents will be available
for inspection at the meeting venue until
the end of the meeting.
150 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Explanatory notes to the notice of meeting
Notice of the 134th annual
general meeting of Young
& Co.’s Brewery, P.L.C. (the
‘Company’) to be held on
Thursday, 6 July 2023 is set
out on pages 146 to 150.
Resolutions 1 to 13 are
ordinary resolutions; this
means that for each of those
resolutions to be passed,
more than half of the votes
cast must be in favour.
Resolution 1: annual
accounts and reports
The directors have to lay copies of the
Company’s annual accounts, the strategic
report, directors’ report and the auditor’s
report on those accounts and reports
before you at a general meeting; this is a
legal requirement.
Resolution 2: final dividend
An interim dividend of 10.26 pence per
share was paid on 2 December 2022.
The directors are recommending a final
dividend of 10.26 pence per share for the
year ended 3 April 2023, bringing the
total dividend for the year to 20.52 pence
per share. Subject to approval being
given, the final dividend is expected to
be paid on 13 July 2023 to shareholders
on the register at the close of business on
9 June 2023.
Resolution 3: auditor
appointment
An auditor is required to be appointed
for each financial year of the Company.
Ernst & Young LLP, the Company’s
current auditor, has agreed to serve for
the current financial year and their re-
appointment is therefore being proposed.
Resolution 4: auditor
remuneration
In accordance with normal practice, the
directors are asking for your authority to
determine the auditor’s remuneration.
Resolutions 5 to 10:
re-appointment of directors
Simon Dodd, Mike Owen, Tracy Dodd
and Nick Miller are retiring as directors
at this meeting; this is because they were
directors at the last two annual general
meetings and did not retire at either of
them. Mark Loughborough and Sarah
Sergeant will also each be retiring from
the office of director at the meeting; this
is because each of them was appointed
by the board since the last annual
general meeting. All of these individuals
are seeking re-appointment; their brief
biographical and other details are on
pages 58 and 60.
Resolution 11: political
donations and expenditure
This resolution seeks renewal of the
existing authority for the Company
and its subsidiaries to make or incur
certain political donations and political
expenditure. Although there is no
intention to make or incur such
donations or expenditure, the legislation
is very broadly drafted and may catch
activities such as funding seminars and
other functions to which politicians are
invited and supporting certain bodies
involved in policy review and law reform.
The authority given by this resolution will
be capped at £50,000 in total.
Resolution 12: increased
limit on the amount payable
in respect of directors’ fees
Broadly, article 52(A) of the Company’s
articles of association provides that the
total fees to be paid to all the directors
must not exceed £375,000 a year
or any higher sum decided on by an
ordinary resolution at a general meeting
– a fee payable to a director pursuant
to this article is distinct from any salary,
remuneration or other amount payable to
him or her pursuant to any other provision
of the articles. Following the appointment
of two additional independent non-
executive directors since the last ordinary
resolution was put to shareholders in
2021, the board would like to ensure
that the Company is able to continue
to recruit and retain suitable candidates.
It is proposed that the higher sum
authority for article 52(A) be increased to
£500,000. The directors may consider
making further board appointments and
the increased amount provides the board
with the flexibility to allow it to do so
should it be considered appropriate.
Resolution 13: directors’
authority to allot shares etc.
Paragraph (a) of this resolution would
give the directors the authority to allot
shares or grant rights to subscribe for or
convert any securities into shares up to
an aggregate nominal amount equal to
£2,436,858 (representing 19,494,864
shares of 12.5p each). This amount
represents approximately one-third of
the Company’s issued share capital as
at 19 May 2023. In line with guidance
issued by the Investment Association,
paragraph (b) of this resolution would
give the directors authority to allot
shares or grant rights to subscribe for
or convert any securities into shares in
connection with a rights issue in favour of
ordinary shareholders up to an aggregate
nominal amount equal to £4,873,716
(representing 38,989,728 shares), as
reduced by the nominal amount of any
shares issued under paragraph (a) of
this resolution). This amount (before
any reduction) represents approximately
two-thirds of the Company’s issued share
capital as at 19 May 2023. The directors
are aware of the latest Investment
Association Share Capital Management
Guidelines published in February 2023,
which update the previous guidance to
incorporate all pre-emptive offers, not just
rights issues. The directors have decided
that they will limit the relevant limb of
the allotment authority to rights issues
in line with past practice but will keep
emerging market practice under review.
The authority sought under this resolution
will expire at the end of next year’s annual
general meeting (or, if earlier, at 11.59pm
on 30 September 2024). The directors
have no present intention to exercise the
authority sought under this resolution.
As at the date of the notice, no shares are
held by the Company in treasury.
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Young & Co.’s Brewery, P.L.C. | Annual Report 2023
151
Shareholder Information
Explanatory notes to the notice of meeting continued
Resolutions 14, 15 and 16
are special resolutions; this
means that for each of those
resolutions to be passed, at
least three-quarters of the
votes cast must be in favour.
Resolution 14 and 15:
disapplication of pre-
emption rights
If the directors wish to allot new shares
or other equity securities for cash, the
Companies Act 2006 requires that such
shares or other equity securities are
offered first to existing shareholders in
proportion to their existing holdings.
Resolutions 14 and 15 would give the
directors the power to allot shares for
cash without first offering them to existing
shareholders in proportion to their existing
holdings. The allotment of equity securities
as referred to in Resolutions 14 and 15
includes the sale of any shares which the
Company holds in treasury following a
purchase of its own shares.
The power set out in resolution 14 would
be limited to:
(a) rights issues and offers to holders of
other equity securities if required by
the rights of those securities, or as the
directors otherwise consider necessary;
(b) otherwise, allotments or sales up to an
aggregate nominal value of £731,057
(representing 5,848,456 shares and
approximately 10 per cent. of the
nominal value of the issued share
capital of the Company as at 19 May
2023); and
(c) allotments or sales up to an additional
aggregate nominal amount equal to
20 per cent. of any allotments or sales
made under (b) above (so a maximum
of 2 per cent. of the Company’s
issued ordinary share capital, up to an
aggregate of £146,211 as at 19 May
2023), such power to be used only
for the purposes of making a follow-
on offer of a kind contemplated by
Section 2B of the Pre-Emption Group’s
Statement of Principles 2022 (‘PEG’s
Statement of Principles’).
Resolution 15 is intended to give the
Company flexibility to make non-pre-
emptive issues of ordinary shares in
connection with acquisitions and specified
capital investments as contemplated by
PEG’s Statement of Principles. The power
under resolution 15 is in addition to that
proposed by resolution 14 and would be
limited to:
(i) allotments or sales of up to an
aggregate nominal amount of
£731,057 (representing 5,848,456
shares and approximately an
additional 10 per cent. of the issued
share capital of the Company as at
19 May 2023); and
(ii) allotments or sales up to an
additional aggregate nominal
amount equal to 20 per cent.
of any allotments or sales made
under (i) above (so a maximum
of 2 per cent.), such power to
be used only for the purposes of
making a follow-on offer of a kind
contemplated by Section 2B of
PEG’s Statement of Principles.
The limits in resolutions 14 and 15
are in line with those set out in PEG’s
Statement of Principles. The directors
have no present intention to exercise
the powers sought by resolutions 14 or
15. If the powers sought by resolutions
14 or 15 are used in relation to a non-
pre-emptive offer, the directors confirm
their intention to follow the shareholder
protections in paragraph 1 of Part 2B of
PEG’s Statement of Principles and, where
relevant, follow the expected features of
a follow-on offer as set out in paragraph
3 of Part 2B of PEG’s Statement
of Principles.
The powers sought under these resolutions
will expire at the end of next year’s annual
general meeting (or, if earlier, at 11.59pm
on 30 September 2024).
Resolution 16: authority
to purchase own shares
This resolution would give the Company
the authority to purchase up to 10% of
the Company’s issued shares (excluding
any treasury shares). The directors have no
present intention to exercise the authority
to make market purchases, however the
authority provides the flexibility to allow
them to do so in the future. The directors
will exercise this authority only when to
do so would be in the best interests of
the Company, and of its shareholders
generally, and could be expected to be
earnings enhancing.
Shares purchased by the Company
pursuant to this authority may be
held in treasury or may be cancelled.
The Company currently has no shares in
treasury. The minimum price, exclusive of
expenses, which may be paid for a share
is 12.5p. The maximum price, exclusive
of expenses, which may be paid for a
share is the highest of (i) an amount equal
to 5% above the average of the middle
market quotations for a share of that
class as derived from the AIM appendix
to the Daily Official List of the London
Stock Exchange for the five business days
immediately preceding the date of the
purchase and (ii) the higher of the price of
the last independent trade and the highest
current independent bid on the trading
venues where the purchase is carried out
at the relevant time.
As at 1 May 2023, the Company had
options outstanding over 292,749
A shares, representing 0.5% of the
Company’s issued share capital at that
date. If the Company were to purchase
(and cancel) its own shares to the fullest
possible extent of its existing authority
and of the authority sought by this
resolution, these options would then
represent 0.63% of the Company’s issued
share capital. No warrants to subscribe
for shares are outstanding. The authority
sought under this resolution will expire
at the end of next year’s annual general
meeting (or, if earlier, at 11.59pm on
30 September 2024).
152 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Senior personnel, committees, banks, advisers and others
Directors
Stephen Goodyear
Non-Executive Chairman
Simon Dodd
Chief Executive
Mike Owen
Chief Financial Officer
Tracy Dodd
People Director
Mark Loughborough
Retail Director
Nick Miller
Senior Independent Non-
Executive Director
Ian McHoul
Independent Non-Executive Director
Torquil Sligo-Young
Non-Executive Director
Aisling Meany
Independent Non-Executive Director
Sarah Sergeant
Independent Non-Executive Director
Company Secretary
Chris Taylor
Audit committee
Ian McHoul (Chair)
Nick Miller
Aisling Meany
Sarah Sergeant
Remuneration committee
Nick Miller (Chair)
Ian McHoul
Aisling Meany
Sarah Sergeant
Banks
HSBC Bank plc
8 Canada Square
London E14 5HQ
NatWest Bank plc
250 Bishopsgate
London EC2M 4RB
Barclays Bank plc
1 Churchill Place
London E14 5HP
Auditor
Ernst & Young LLP
1 More London Place
London SE1 2AF
Nominated adviser
J.P. Morgan Securities plc
25 Bank Street
Canary Wharf
London E14 5JP
Stockbrokers
J.P. Morgan Securities plc
25 Bank Street
Canary Wharf
London E14 5JP
Panmure Gordon (UK) Limited
One New Change
London EC4M 9AF
Solicitors
Gowling WLG (UK) LLP
Two Snowhill
Birmingham
B4 6WR
Slaughter and May
One Bunhill Row
London EC1Y 8YY
S
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I
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f
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Shareholder information
Registrar
The company’s registrar is Computershare
Investor Services PLC (‘Computershare’).
They can be contacted at The Pavilions,
Bridgwater Road, Bristol BS13 8AE.
Their telephone number is 0370 707 1420.
Managing your
shareholding online
Computershare operates an
online service, Investor Centre, for
holders of shares in the company.
Investor Centre allows shareholders
to manage their shareholding online,
enabling shareholders to:
• update personal details and provide
address changes;
• update dividend bank mandate
instructions and review dividend
payment history;
• register to receive company
communications electronically; and
• international shareholders can register
payment instructions to benefit from
payments directly into a local bank
account. This service is not available
in all counties.
Shareholders with any queries regarding
their holding should contact Computershare
using the above contact details.
descendants or any other named
beneficiary, to help reunite shareholders
with their unclaimed entitlements.
Further information is available on the
company’s website at: www.youngs.co.uk/
investors under shareholder information.
Shareholder fraud
Fraud is on the increase and many
shareholders are targeted every year.
If you suspect that you have been
approached by fraudsters, please inform
the FCA using the share fraud reporting
form at www.fca.org.uk/scams, where
you can find out more about investment
scams. You can also call the FCA
Consumer Helpline on 0800 111 6768.
If you have lost money to investment
fraud, you should report it to Action
Fraud on 0300 123 2040 or online at
www.actionfraud.police.uk.
Lost Shareholders
The Company has recently appointed
Georgeson, to help find ‘lost’ or ‘gone
away’ shareholders, their dependents,
Shareholder offers
Details of shareholder discounts and offers
are mailed to shareholders from time to
time. Any shareholder who does not wish
to receive details of such offers should
write to the Company Secretary at the
registered office shown below.
Registered office and
company number
Copper House
5 Garratt Lane
Wandsworth
London SW18 4AQ
Registered number: 32762
Further information
Please visit: www.youngs.co.uk
Young & Co.’s Brewery, P.L.C. | Annual Report 2023
153
Shareholder Information
Young’s pubs and hotels
How many have you visited?
Adam and Eve, Fitzrovia
Carnarvon Arms, Newbury
Duchess of Kent, Islington
Albans Well, St Albans
Carpenter’s Arms, Tonbridge
Duke of Cambridge, Battersea
Albert, Kingston-upon-Thames
Albion, City of London
Castle, Islington
Castle, Tooting
Duke of Clarence, Kensington
Duke of Wellington, Notting Hill
Alexander Pope, Twickenham
Chelsea Ram, Chelsea
Duke on the Green, Parsons Green
Alexandra, Wimbledon
Chequers Inn, Hanham Mills
Duke’s Head, Putney
Alma, Wandsworth
Chequers, Walton-on-the-Hill
Duke’s Head, Wallington
Angel & Greyhound, Oxford
Cherry Tree, Dulwich
Dunstan House Inn, Burnham-on-Sea
Bear Inn Hotel, Esher
City Gate, Exeter
Eagle, Shepherd’s Bush
Bear, Cobham
Bear, Oxshott
Beaufort, Hendon
Clapham North, Clapham
East Hill, Wandsworth
Clarence, Westminster
Elgin, Notting Hill
Clock House, East Dulwich
Enderby House, Greenwich
Bedford Arms, Chenies
Coach & Horses, Barnes
Fellow, King’s Cross
Bell Hotel, Stow-on-the-Wold
Coach & Horses, Greenwich
Fentiman Arms, Oval
Bell, Fetcham
Coach & Horses, Isleworth
Finch’s, Moorgate
Betjeman Arms, St Pancras
Coach & Horses, Kew
Fire Stables, Wimbledon
Bickley, Chislehurst
Coat and Badge, Putney
Bishop, Kingston-upon-Thames
Coborn, Mile End
Flask, Hampstead
Foley, Claygate
Bishop’s Vaults, Bishopsgate
Cock Tavern, Fulham
Founders Arms, Southbank
Blue Boar, Chipping Norton
Boathouse, Instow
Boathouse, Putney
Brewers Inn, Wandsworth
Bridge Hotel, Chertsey
Britannia, Kensington
Brook Green Hotel, Hammersmith
Buckingham Arms, Westminster
Bull and Gate, Kentish Town
Bull, Bracknell
Bull, Ditchling
Bull, Streatham
Bull, Westfield, Shepherd’s Bush
Bulls Head, Chislehurst
Bulls Head, Barnes
Bunch of Grapes, London Bridge
Canbury Arms,
Kingston-upon-Thames
Constitution, Camden
(closed – not trading)
Coopers Arms, Chelsea
County Arms, Wandsworth
Cow, Westfield, Stratford
Crooked Billet, Wimbledon
Crown & Anchor, Chichester
Crown Hotel, Chertsey
Crown Inn, Minchampton
Crown, Bow
Crown, Lee
Crown, Twickenham
Curtains Up, West Kensington
Cutty Sark, Greenwich
Defector’s Weld, Shepherd’s Bush
Devonshire, Balham
Dial Arch, Woolwich
Dirty Dicks, Bishopsgate
Candlemaker, City of London
Dog & Fox, Wimbledon
Canford Hotel, Poole
Canonbury, Islington
Dolphin, Betchworth
Double Locks, Exeter
154 Young & Co.’s Brewery, P.L.C. | Annual Report 2023
Fox & Anchor, Smithfield Market
George Hotel, Cheltenham
Grand Junction Arms, Harlesden
Grange, Ealing
Grantley Arms, Wonersh
Green Man, Putney
Greyhound, Carshalton
Griffin Inn, Fletching
Grocer, Spitalfields
Grove, Balham
Grove, Exmouth
Guard House, Woolwich
Guinea, Mayfair
Half Moon, Putney
Half Moon, Windlesham
Halfway House, Earlsfield
Hammersmith Ram, Hammersmith
Hand and Spear, Weybridge
Hand in Hand, Wimbledon
Hare & Hounds, East Sheen
Highbury Vaults, Bristol
No 38 Park Hotel, Cheltenham
Ship, Wandsworth
Hollow Bottom, Guiting Power
Northcote, Battersea
Hollywood Arms, Chelsea
Old Brewery, Greenwich
Home Cottage, Redhill
Old Manor, Potters Bar
Hope and Anchor, Brixton
Old Shades, Westminster
Hort’s Townhouse, Bristol
Old Ship, Hammersmith
Kings Arms, Oxford
Kings Arms, Chelsea
Old Ship, Richmond
One Tun, Fitzrovia
Kings Arms, Wandsworth
Onslow Arms, West Clandon
Kings Head, Islington
Orange Tree, Richmond
Kings Head, Roehampton
Owl & Pussycat, Shoreditch
Kings Head, Winchmore Hill
Oyster Shed, Bank
Lamb Tavern, Leadenhall Market
Park Hotel, Teddington
Lamb, Bloomsbury
Lamb, Hindon
Paternoster, St Paul’s
Penny Black, Leatherhead
Lass O’Richmond Hill, Richmond
Pheasant Inn, Lambourn
Leather Bottle, Earlsfield
Leman Street Tavern, Aldgate
Phoenix, Chelsea
Phoenix, Victoria
Lion and Unicorn, Kentish Town
Plough, Beddington
Lock Keeper, Keynsham
Lockhouse, Paddington
Plough, Clapham Junction
Porchester, Westbourne Grove
Lord Palmerston, Tufnell Park
Prince Albert, Battersea
Lounge at The Salt Room, Islington
(closed – not trading)
Manor Arms, Streatham
Marlborough, Richmond
Marquess of Anglesey,
Covent Garden
Merlin’s Cave, Chalfont St Giles
Mitre, Lancaster Gate
Mitre, Shaftesbury
Morpeth Arms, Westminster
Mulberry Bush, Southwark
Narrowboat, Islington
Naturalist, Hackney
New Inn, Ealing
Nightingale, Balham
Nine Elms Tavern, Battersea
Prince Alfred, Maida Vale
Princess of Wales, Clapton
Queen Adelaide, Wandsworth
Queens, Primrose Hill
Red Barn, Lingfield
Red Lion, Radlett
Richard the First, Greenwich
Riverside, Vauxhall
Riverstation, Bristol
Roebuck, Hampstead
Rose and Crown, Wimbledon
Royal Oak, Bethnal Green
Seagate Hotel, Appledore
Shaftesbury, Richmond
Ship Inn, East Grinstead
Smiths of Smithfield,
Smithfield Market
Spotted Horse, Putney
Spread Eagle, Camden
Spread Eagle, Wandsworth
Spring Grove, Kingston-upon-Thames
Station Hotel, Hither Green
Station Tavern, Cambridge
Swan, Walton-on-Thames
Tavern, Cheltenham
The Depot, Kidbrooke Village
Theodore Bullfrog, Charing Cross
Trafalgar Arms, Tooting
Trinity Arms, Brixton
Victoria, Kingston-upon-Thames
Village Inn, Ealing
Waterfront, Wandsworth
Waterside, Fulham
Weyside, Guildford
Wheatsheaf Hotel, Northleach
Wheatsheaf, Borough Market
Wheatsheaf, Esher
White Bear, Kennington
White Bear, Tunbridge Wells
White Cross, Richmond
White Hart, Barnes
White Hart, Littleton-on-Severn
White Hart, Sherfield On Loddon
White Horse, Broadgate
White Horse, Hascombe
Wild Duck, near Cirencester (closed –
not trading)
Windmill, Clapham
Windmill, Mayfair
Wood House, Dulwich
Woolpack, Bermondsey
Worplesdon Place, Guildford
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Young & Co.’s Brewery, P.L.C.
Copper House, 5 Garratt Lane,
Wandsworth, London SW18 4AQ
Telephone: 020 8875 7000
Fax: 020 8875 7100
www.youngs.co.uk
Registered in England number 32762