Annual report 2016

Key performance indicators


To maintain focus on our five strategic priorities, we have a set of overall financial and non-financial KPIs, which are also used to help to align remuneration to performance.

KPI PROGRESS IN FY16
Pub Company like-for-like sales (%)
The sales this year compared to those in the previous year for all Pub Company sites that were trading throughout the two periods being compared, expressed as a percentage. In Pub Company, on a combined basis, LFL sales grew by 1.5%, ahead of the market, which grew by 1.3% over a broadly comparable period1. LFL sales growth in the original Greene King estate of 1.9% (2015: 0.4%2).
EBITDA per pub: Pub Company
EBITDA (operating profit before depreciation, amortisation and exceptionals) divided by the average number of trading pubs in the period. In FY16, EBITDA per pub in Pub Company was impacted by synergies and fair value adjustments offset by the higher proportion of leasehold properties in Spirit – as a result EBITDA per pub fell by -3.6%. However, in the original Greene King managed estate average EBITDA per pub grew by 2.3% (2015: -0.2%2), which excludes synergy contribution.
Pub Partners LFL net income
Net income is EBITDA in our leased, tenanted and free-of-tie pubs, stated before property costs and administrative expenses – the change in net income is on a same estate basis (i.e. adjusting for disposals). The tenanted and leased businesses were successfully integrated at the end of the first half and the combined Pub Partners business grew net income by 2.7% in the year (2015: +3.5%2).
EBITDA per pub: Pub Partners
EBITDA (operating profit before depreciation, amortisation and exceptionals) divided by the average number of trading pubs in the period. Average EBITDA per pub increased by 14.3% (2015: +15.5%1) reflecting the contribution of the Spirit sites, ongoing improvements in the quality of the estate (such as the disposal of 48 pubs from the combined estate) and synergy contribution.
Brewing & Brands OBV growth (%)
Year-on-year growth in the sold volume of our own-brewed ales. Brewing & Brands achieved 2.9% OBV growth (2015: +4.2%2), and helped us to extend our share of the UK ale market by 40bps to 10.5%.
Return on investment (%)
The incremental EBITDA delivered as a result of our developments, divided by the value of the capital investment. Annualised return on development capex improved to 27.8% (2015: 22%2).
Return on capital employed (ROCE) (%)
Pre-exceptional operating profit divided by the average capital employed throughout the year. Capital employed is defined as total net assets excluding deferred tax balances, derivatives, post-employment liabilities and net debt. The business achieved another year of robust returns, generating a ten basis point increase in ROCE to 9.4% (2015: 9.3%) which remains comfortably ahead of our cost of capital.
Adjusted basic earnings per share (pence)
Profit for the period attributable to equity holders, excluding the effect of exceptional items, divided by the weighted average number of shares in issue during the period excluding own shares held. Earnings per share before exceptional items was 69.9p (2015: 61.0p), up by 14.6%.
Pub Company net promoter score (NPS) (%)
The percentage of responses where we score 9 or 10 (out of 10) less the percentage of responses where we score 0 to 6 (out of 10) to the statement ‘I am likely to recommend this pub to a friend and/or relative’. Record customer satisfaction scores; NPS +7.9%pts (2015: +12.3%pts).
Team turnover (%)
The percentage of leavers against the average headcount over a rolling annual period, excluding any student leavers. We saw an improved trend in team turnover. The improvements indicate the success of our teams in continuing with business as usual during the integration process.
Team engagement (%)
The proportion of respondents who agreed with the following statement: ‘I would recommend Greene King as a great place to work to others’. Team engagement currently stands at 73% across the combined group. Investing more in the recruitment, retention and development of our people will lead to a better trained and more motivated team working across our business, which will be reflected in ongoing improvements in team engagement, team retention and the service we give to guests.
  1. Coffer Peach Business Tracker.
  2. Greene King: excludes synergies arising in the Greene King business.