NewRiver REIT plc (NRR) Earnings Call Transcript & Summary

Good afternoon, everybody. Before we start today's presentation, I'd like us all to reflect on the sad loss of our Co-Founder, David Lockhart, a special man and special adviser to NewRiver and Chairman of our pub company. Many of you on this call this afternoon have met David, have known him a long time. David was a great friend, an inspirational leader, a true gentleman, and will be remembered for his warmth, generosity, loving and fun character and his enormous intellect. David and I did hundreds, in fact, thousands of investor meetings together, he will be with us today in spirit. David, you have helped us create a great company, a great culture, and thank you for everything you've done for us all. And on behalf of the team at NewRiver and Hawthorn, we will all miss you dearly. Now thank you, everybody. Just taking you on to the presentation this afternoon. I'm Mark Davies, CEO of Hawthorn and CFO of NewRiver. And I'd like to thank you all for dialing in this afternoon to our capital markets event. For reasons that we all know, this year's event is being held virtually. Whilst I would have loved to invite you to come and see some of our brilliant community pubs, holding the event virtually does, of course, bring us some advantages. It allows us to reach a far larger audience. I believe there's close to 150 people on the call this afternoon, a large group of investors, analysts and advisers. And of course, we're able to give you a tour across our portfolio from the comfort of your desk. So thank you very much for -- to all of you for attending this afternoon. Today, we'll cover the following. We'll give a trading update that we released this morning, demonstrating yet again the continued resilience of the NewRiver business, the strength of our balance sheet and our cash position. Then we are very grateful to being joined by Emma McClarkin. Emma is the Chief Executive of the British Beer and Pub Association. Emma will provide her reflections on the U.K. pub sector today, some of the interesting issues that we are currently facing. And I have the fortune of working very closely with Emma on the Board of the BBPA and I've experienced firsthand the great work ethic and the great work that she has been doing on behalf of the sector. She has very, very strong political nose and political connections, and that makes her a formidable force and a strong ambassador for Hawthorn and the other major pub-owning companies. So thank you, Emma. Now Matt and I, Matt's here in the room with me today, will run through our financial and performance update. After that, we'll delve into a bit more detail. Our operations and property colleagues will provide more information about our future plans for the business and the continued value-creating opportunities that we see in our portfolio. You will be able to see and clearly identify the benefits of owning a community pub portfolio and the resilience of that model, our model, in a COVID environment. We will also provide a people update and an overview of the market. So to today's presentation team. Most of you on the call today will know me. But for those of you who don't, I'm Mark Davies. I'm a sort of Co-Founder of NewRiver, CFO, and since 2017 have been running our highly successful community pub business, Hawthorn, for which I am the CEO. It's a role I thoroughly enjoy. And I'm sure my enthusiasm and confidence in Hawthorn and its future will come across this afternoon in the presentation to you today. In the room to my left is Matt Ward, Hawthorn's CFO. Matt's been with the business since early 2016. You will meet Matt shortly, and he and I will present the financial and performance update together. Dialing in from the British Beer and Pub Association is Emma McClarkin, who I mentioned is the CEO, I'm very lucky to have Emma today. Emma is a political communications expert and was formally an MEP. Andy Parker, who leads our operations team for Leased & Tenanted portfolio has been with Hawthorn since 2014, having previously had an extensive career in food retail and in the pub sector with EI. Mark Brooke, who leads our operations team for our operator managed business. Mark actually joined the business pre-lockdown from EI where he was a Divisional Director, running their Beacon division, which is a highly successful portfolio for EI with over 350 pubs, delivering consistent positive like-for-like growth. Technology permitting, Andy and Mark are actually at one of our pubs today, so will be dialing into the meeting later this afternoon. Also in the room with me today, Ed Little, our Property Director; and Edith Monfries, who's our COO, Head of HR and people champion, who's really helped us create such a great culture at Hawthorn, and no doubt, one of the key ingredients and secrets to our success. Finally, before we get into the presentation, this is our agenda for today. The plan is to finish at 5:00 p.m. sharp, so we will be efficient with our time. But we would like you to help us make the session as interactive as possible. So please do submit your questions through the webcast page. We will try to go through them all, of course, and we will stop for Q&A sessions at the end of each presentation. If your question is not read out, please don't worry. We'll do our very best to get that asked at a later session. And if we're not able to do that, we will have a wrap-up session at the end of the afternoon. So now on to our trading update that we released to the market this morning. The REIT is clear. It's precise about the strong financial position that NewRiver is in today and of course, the key priorities that we are working. And if I may just sort of extract what I think are some of the key highlights. Firstly, rent collection in our retail portfolio, you can see on the slide that our rent collection actually has been remarkably robust in a clearly challenging environment. We're now close to 90% rent collected in both our first and second quarters, which is March '20 and June 2020. In fact, the early signs are for our third quarter, which is September, our rent collection is already at 66%, and that's just 7 days since we started to demand rent. And the signs to us are pretty clear, that the rent collection for Q3, at this point, is in a better position than we've seen in Q1 and Q2 previously. So I think that's worth pointing out. And also worth pointing out that we do actually collect our rent in advance. So we have plenty of time to see continued improvement of the rent that we expect to collect. Cash flow and liquidity in this market is obviously extremely important. And our cash and liquidity position is now stronger than ever. We have around GBP 140 million of cash in the bank. Previously, that was GBP 82 million. We have an investment-grade credit rating. All of our debt is unsecured. All of our assets are unencumbered. What a great place to be, actually, in a COVID environment. Our total liquidity now is GBP 235 million. That has improved by an excess of GBP 100 million since our financial year-end back in March 2020. We're also ahead of plan on our retail disposals. We successfully sold a 90% stake in a retail park in Sprucefield, Northern Ireland, last week to our Bravo joint venture, very close to book value. That's generated GBP 34.7 million of cash proceeds. So we're very pleased about the progress that we're making there. And finally, our pub company performance, we have the theme of today, this presentation is about our community pub business. But we did point out to the market this morning, rightfully so that both our leased and tenanted and our operator-managed estates are outperforming the market. And this is a reflection, we feel, of the quality of the portfolio and the bias towards community and suburban locations. We will, of course, be going through all of this in great detail later on. Next, I'd like to just focus in on our excellent track record in this sector, which is recognized, we think, by the market. We first started investing in community pubs over 7 years ago. Our first portfolio deal was with Marston's, where we acquired 202 pubs for GBP 90 million. That was actually a great deal for us at a yield of 12.5% with a guaranteed rent of 12.5% yield. We're also extremely quick, out of the blocks, identifying value-creating opportunities and more on that from Ed later on. We've done some highly accretive deals since, including acquisitions from Punch, Heineken and again from Marston's. Now an important milestone for us was the acquisition of Hawthorn in 2018. Not only do we acquire a really good portfolio of assets, well-managed and well invested. We also acquired a pub-operating platform. This is proving to be a good strategic decision, delivering many of the benefits you will see in the presentation today, including the quality of our people, the scale benefits, the relationships with the brewery companies and a best-in-class operating platform. We have gone from strength to strength by adding to the portfolio, albeit we were slightly less active in 2019 as the market was a little more heated and a bit more competitive, with portfolios trading at up to 13x of EBITDA. We did, however, take this opportunity to dispose of what we believe are noncore assets by right-shaping the portfolio and exiting from a fully managed sector. With hindsight, this was a really smart thing to do because now we have lower employment costs. It simplified our business model, raised cash from the sale of around 100 pubs in total that don't fit our community pub model. Our stock selection has always been very disciplined and we have acquired portfolios at multiples of between 5 and 8x of EBITDA equating to a purchase yield well in excess of 10%. Recently, we did acquire a business called Bravo Inns, and I will talk more about that later because it's an excellent addition to our portfolio, bang in line with our strategy to create a highly profitable operator-managed business with scale benefits. Now to the main focus of our presentation to you this afternoon. Our mission at Hawthorn is to create the #1 community pub company in the U.K. And Hawthorn is now firmly established as one of the top 7 U.K. pub companies by size, and there are 8 clear and compelling reasons that support a strong investment case. Firstly, our assets are in great locations. We are strong believers in the community pub model, and this is definitely the right time to be owning a community pub portfolio where the majority of our estate is located in neighborhood and suburban locations. In a post-lockdown world, we have witnessed firsthand the benefit of owning assets in these locations, which are natural neighborhoods and always surrounded by housing or chimney pubs. Now Emma will cover this in a moment, but there's no doubt that a community pub estate is highly sustainable and we feel set to continue outperforming the market. Our portfolio is high income and is asset backed. What we mean by this is the income yield on the assets we own and acquire is typically between 10% and 17% and our assets are almost all freehold. We own a high-quality portfolio of assets, and this is a clear driver of our strong performance, and you will see this later in the presentation. Thirdly, we can deliver earnings growth. And up until March this year, our like-for-like EBITDA growth was plus 5.9%. We're able to do this through our active asset management, our synergies and the ability to create earnings through investment. Fourthly, the scalability of our business model. We have a proven track record of profitable and accretive transactions and the synergies and scale benefits that we have delivered on previous transactions can be repeated over and again to the benefit of our shareholders. Next, as an extremely compelling point with our track record is the ability to create value through other uses. As a management team, we have a proven track record of being able to do this and it's highly profitable. We do, of course, benefit from the fact our assets have good roadside visibility, they're in convenient locations and often have surplus land. We are very, very good at seeing and creating value that is sometimes overlooked by others. Great relationships. We have a great people culture at Hawthorn. We put people at the heart of everything that we do. These relationships create value through trust commitment, goodwill and partnerships. We have a lot of brilliant people and experienced people in our business, and this is a real competitive advantage. One of the intangible synergies of the Hawthorn acquisition has been the enhancement of those relationships, particularly with some of the brewery companies. We have a best-in-class operating platform. We have assembled a first-class team who are highly focused, motivated, committed and results driven. We have invested in our systems and our infrastructure, and this foundation will enable us to build a bigger, more profitable business. And finally, and by no means least, a strong balance sheet with a clean and unencumbered capital structure. Matt and the team have done a brilliant job for us to be cash flow positive during lockdown, returning to profit so quickly after reopening, and this has strengthened our position further. Our mission is to create the #1 U.K. community pub company. We are well on track to delivering this. And on that note, I'd like to pause for questions before passing on to Emma. So I think we'll begin by going to the phone lines.

[Operator Instructions] Our first question comes in from the line of Tom Musson calling from Liberum.

It sounds like from the sort of trading update this morning, the sort of pub like-for-like since lockdown restrictions eased have maybe been a little bit better than expected. But sort of news today, looks like the government is drawing up new restrictions on pubs and restaurants in the North of England. And obviously, sort of, it's happened in Scotland announced yesterday. I think we might hear more on that over the weekend, I mean, the North of Broughton. But can you give us an idea of how many of pubs maybe at risk of falling into that net, if more restrictions sort of come down in the north? And maybe sort of how many pubs you've got exposed up in Scotland there as well?

Thanks, Tom. But clearly, we're dealing with a fast-moving situation. Since we opened the estate on the 4th of July, we've had to deal with a number of hurdles and localized issues. We've seen lockdowns in Leicester. We've seen lockdowns in Aberdeen, Bolton and other parts of the Northwest. We've seen curfews in the Northeast of England. Of course, all of this is reflected in the performance that you will see in the presentation today. In the last couple of weeks, clearly, those restrictions and lockdowns have moved in Scotland, the announcements of yesterday, in spite of what we think is the unfairness of those restrictions, we will react and have a plan accordingly. The benefit of having a diversified portfolio is that we are -- our income streams and the profits that we generate are diversified all around the U.K. We've got a couple of slides on that specifically later. Tom will talk to you about the estate in Scotland because we've got a very good portfolio up there. And yes, the news of yesterday is going to hurt us a little bit. But we've got a plan to deal with it, and we'll be talking about that later in the presentation. As far as the North is concerned, there's been restrictions, local knockdowns, et cetera, in large parts North of England now for quite some time, and the team have done a terrific job in reacting to those changes and challenges quickly. And in spite of that, you'll see later, our like-for-like performance has been incredibly strong. All we can do is focus on running this business to the best of our ability, comply with all the rules and regulations that are put upon us, conduct our business in a safe and socially responsible way and keep delivering outperformance. That's all we can do really, Tom. We've done it since we opened on the 4th of July. And we want that to continue. And myself and the team are totally focused on being able to do that.

We have another question coming through via the audio lines from the line of Clive Black calling from Shore Capital.

I'm very sorry for the loss of your Co-Founder. I just wondered if you could give us an indication of the nature. I know you'll maybe come on to it in the presentation, but just given the prior question about the coronavirus environment. The nature of your pub estate to accommodate people on a more spacious basis and particularly the outsides of your business -- sorry, the areas of your business.

Thanks, Clive. That's a really good question because one of the clear signs that we've seen coming through lockdown is a willingness of customers to spend more time in outdoor space. We're actually quite fortunate that a lot of our pubs do have outdoor space. Over 70% of our portfolio has good quality outdoor space. Now we'll be talking about that a little later on in the presentation. Also during lockdown, from the 20th of March to the 4th of July, 86% of our portfolio was invested in. Now the majority of that investment went in from the pub partners and the operators themselves using government support and grants, amongst other things, to invest into their pubs and the pubs that we own. And a lot of that has gone into outdoor space. We also bought a business that I mentioned in my opening remarks called Bravo Inns at the back end of last year. One of the appealing factors of that acquisition was the quality of the outdoor space, sizable, covered outdoor space that can extend the capacity of a pub to trade greater sales, but also to trade into the autumn and winter months. Now clearly, when we bought Bravo last year, we perhaps did not see what was coming, but we could see our little al fresco economy for one of a better term, and people enjoying spending time outdoors, socializing with their friends and family. And since we reopened on the 4th of July, that has been a recurring theme. And there's no doubt the pubs that we have got, and we have many with outdoor space, have outperformed pubs in our portfolio that don't. And we'll be talking about that later, Clive. So I'm glad that you asked the question because it is a topical issue as we try to extend our trading environment for as long as we can into the autumn and winter months, and then bounce back strongly in the spring of next year.

And if you're covering this later on then, don't repeat it. But just in terms of if you gave us some indication of, and the sales performance of Hawthorn through the recent months, did you say them at all now about what people were drinking, to the extent -- the nature of the mix of -- your gross margin mix, the nature of your trade. As I said, if you'll cover it later on, fine, but if not, maybe give us some color now.

No, I could do that, Clive. I won't spend too long on it. Because okay just because Emma's going to cover that in a moment, because she obviously sees the entire industry. Andy and Mark will make reference to it as well later on in some of their presentations because they see the day-to-day performance. Certainly, since we opened on the fourth of July, we definitely saw a move towards premiumization. What we mean by that is customers were clearly prepared to pay a little more for a better quality product. Now there's a number of reasons why that might have happened, not least people might be wanting to treat themselves and perhaps have more disposable income at the time given that savings ratios were going up, amongst other things. But clearly, that is a trend that we've been tracking and seems to have been extended until recent times and we expect that to continue. So Emma will be talking about that in a moment. But definitely, people are prepared to pay more for a premium product. And yes, that is good for us because clearly, there's more profitability in that segment.

And the final question comes in from the line of Andrew Gill calling from Jefferies.

I've just got a couple maybe on retail before we move on to pubs. I see, obviously, you've got some -- you've had some leasing activity there, particularly B&M. Was this leasing broadly in line with what you would have expected pre-COVID? And maybe just a second brief question, obviously, on the rent collection numbers. There are a couple of large well-known retailers that weren't necessarily paying their rent during lockdown. Has that landscape changed more recently as the kind of the larger tenants began to pay in a more timely fashion?

Thank you, Andrew. I'll address both questions. I'm glad you mentioned B&M because they're a great tenant, great occupier and we have a good relationship with them. We continue to be able to undertake new leasing events with them, very sensible rents in line with previous passing rents and our own budgeted projections. They're a great retailer. They're very disciplined about what they do and what they are prepared to pay and we respect that and of course, benefit from that because they are prepared to take longer leases. So very aligned with everything that we're having to do and trying to do on the asset management side. In terms of the payment of rents, I made the point earlier that we are way ahead of where we were this time in June and this time in March, in my opening remarks, and I did that for good reason. The key driver behind that is linked to the question that you raised. Earlier in the year, there were -- there were several, at one point, many national and multinational retailers, open and trading, who were not paying rent, and that was reflected, obviously, in the numbers that we presented to the market. We've always been very open and transparent with our rent collection data. I forget how many times we've released this to the market since March, but it must be 3 or 4 times that we put these figures into the market. And the reason why we are announcing ratios to you this morning, better than we've seen previously is because most, in fact, almost all of those national and multinational retailers have now paid. And if they've not paid, we've agreed a payment plan with them, which is legally binding. So progress, good progress and long may continue. And of course, that's reflected in our cash balances that we've announced to the market this morning, which are way ahead of where we were only 6 months ago. Of course, half of that time was lockdown. So yes, good news on the rent collection point. Andrew, I think that's addressed your questions. But forgive me if I've missed anything.

No, that's great. That's very helpful color.

Well, thank you. That concludes the first session, the questions and answers. And on that point, I will be passing on to Emma McClarkin, who's the CEO of the British Beer and Pub Association, who is dialing in on Zoom this afternoon. Thank you, Emma. Over to you.

Well, good afternoon, everybody, and thank you, Mark, for inviting me to take part in your presentation today and Investors Day. My name is Emma McClarkin. I'm the Chief Executive of the British Beer and Pub Association, but I also represent the Scottish Beer and Pub Association as well. So it's been a busy day for me. I started in this role in November, and it was always going to be a great challenge, and this is definitely a period of challenge for us. But one I hope that we will work into strongly and we will come out strongly from as well. So if we could move on to the first slide, unfortunately, I cannot see them from where I am. So if you can bear with me, I just hope that you're on the right slides where you are. In terms of the BBPA, if I could just outline a little bit about our vision. This is to deliver a world-class growth sector for British beer and pub hospitality. And is an enormously proud role for me to do as a beer and pub lover myself. And of course, our members are 90% of brewers in the United Kingdom, but also we represent around 20,000 of pubs that we have as well. And on this slide, you can see just a range of some of our members there that we have, of course, including Hawthorn Leisure. Our aims and objectives are to campaign, to unite the voice of industry, but also to provide support to our members, but also to the steps up particularly through the pandemic that we're going through. Forgive me for this. I'm having some issues with seeing the slides on the screen. But if you could just bear with me, there's a board here at the BBPA. And of course, I'm very proud to be supported by such a phenomenal board. We have the Chairman, of course, who's Phil Whitehead is the MD for Western Europe for Molson Coors. And then, of course, we do also have on that Board, Ralph Findlay of Marston's; William Lees-Jones from the Lees-Jones family up in the Northwest; Kevin Georgel from St Austell's Brewery down in Cromwell. And we were joined by Nick Mackenzie and of course Mark Davies, who is CEO of Hawthorn Leisure, who is also taking on board our Chair of the Finance Committee as well. So I am ably supported by my team at the BBPA. And we cover many of those impacts. Thank you for bringing these up on the screen, from public affair statistics to member engagement as well. So it is my job to lead the sector through the crisis. And it is a daily challenge, I have to tell you, but one that I am ably supported on by the BBPA Board. We have, throughout the crisis, had high-level strategic meetings on a weekly basis and really stepped up the engagement that we have in order to make sure that we can navigate our way through this. As I mentioned, Mark Davies and Nick Mackenzie from Greene King did join the Board at the start of this crisis. And they both provided me really with invaluable insight, not only on the fiscal and the trading insight, but in terms of how we can see a way through this and also reporting back on how we're doing with our trading throughout the opening, which is all we have in terms of the conversations that I need to have with government. We do have a core stakeholder group that we've convened throughout the crisis as well, that really gives us that broader view of what's happening across the whole of the sector in all regions of the country as well. So I provide daily updates from members. I'm sure they absolutely love hearing from me on a daily basis. But it provides them with the latest intel that we have, and that is enormously important to get us through this. So pub has played a vital role throughout the lockdown. The doors may have been closed to normal trading, but many of them have adapted their businesses. They have opened up as the only convenience in some of our towns and rural villages. And this is also where we see people becoming takeaway providers, but also making sure that they're still playing a vital, pivotal role within their communities as well. So it's been enormously proud for me to see the contribution that the pubs sector is still making. But of course, getting the pubs reopened was a monumental task. We managed to secure that date on the 4th of July. And we have to say, had a very steady start as we saw that when we opened the pubs that the demand was there, we had to win the confidence back, that we did that, and we're doing quite well over the summer time as well. And we created an incredibly safe and responsible environment, all that in order to give them that confidence and also to stay within the government guidelines. So how, again, have the BBPA been supporting our pubs during lockdown? All of what I said before. But of course, we also provide briefings to our pub companies on a range of issues, depending on what's happened on that day, but particularly in and around the government's guidance, instruction from how to implement that guidance has been there, making sure that we are pushing ahead for getting the relaxation on planning and licensing to also help us adapt with those capacity restrictions that we have, but also to make sure we're actively maximizing the space that we do have. But of course, we also push to make sure that people could adapt their businesses and do that quickly. For example, not having to fight the planning commission in order to turn into a takeaway. So things like this we've really helped businesses adapt and adapt quickly. We've also been helping our pub companies across the U.K. access government support. And we have outlined here on the slide, you'll see many of the ones that we have in rather large numbers. So business rates relief with GBP 800 million. Business grants for pubs was GBP 600 million. Job retention scheme, GBP 1.6 billion on its own. But access to finance was enormously important, so making sure we had facilities and access to CBILs and bounce back loans has been very, very helpful to some of the sector. But 5% reduction rate on food and soft drinks in our pubs was GBP 430 million, and that has now been extended, and that was before the extension. So hopefully the value would be greater for that as well. Also making sure we can support our tenants in terms of their overheads in terms of the subscriptions that they have, be it for music, the PPL and PRS, we're looking at Sky and BT Sport in terms of arranging how we can actually reduce those overheads. And of course, there was the Eat Out to Help Out Scheme, which is an enormous move for our food-led venues, and that was worth GBP 120 million to the sector. So an enormous part [indiscernible] food sector. So we've been working with our industry partners, other trade associations to make sure that we secure these support packages. And the value of their support we have secured to date is equivalent to GBP 3.7 billion for savings for brewers and for their pubs as well. So you can see that we've really managed to get together quite a package for the sector. So we really do need to keep that lobbying up and we are doing that and having daily dialogues with the government, I have to say, particularly at this moment right now, the current focus was on the 10 p.m. curfew, and of course, will now be on further restrictions yet to be announced for Northern England and perhaps next week as well. During the lockdown, we already had to deal with a roadblock coming our way, but big distraction was a really big one. That actually, we had to find a safe and environmentally friendly way to dispose of 70 million pints of beer and the mix we were required to. But actually, the cost that we managed to save people by getting fees waived by water companies was GBP 25 million. So we're trying to cost cut for our sector to help them get through this crisis significantly. And of course, we actually guided as the hospitality sector, with first draft and the original guidance that you open up the workplace within our pubs and restaurants. So we continue to work with the government and their hospitality unit to make sure that the implications of any implementations for measures to create that COVID-safe, secure environment are actually, practically implementable. So there is a really big breadth of issues that we cover, and here is just a flavor of what we do. And of course, there are those step outside of the crisis zone, like our climate change agreement, also making sure that we're participating in voluntary and to tertiary pub codes. They're looking at other issues such as gaming, but also coffee right, and of course, the health and environmental as well. But we're very, very much part of our communities, and we're very much part of the future of our high streets. In many cases, we are the destination that people are coming into those towns for. So it is important for us to be part of the future going to that as well. So I think this is probably the most important part in my discussion and presentation today, to be able to give a bit of a sense of where we are and the trends that we are seeing in the pub sector as we are emerging from these crisis and perhaps looking before that as well. We have absolutely seen that the community pubs have outperformed our city center venues. This has been consistent picture, of course, really, in the United Kingdom since lockdown. And of course, many of our city center pubs are currently remaining closed, and that's whether they're in a restriction or outside of it. And particularly, London has been badly hit. But our community pubs have really led that recovery to date, and I think that we can really seen the value of our community-led pubs. Mark touched on it earlier, but we do have premiumization. This was definitely a trend that we saw ahead of the crisis, but it's something that we expect to continue. We have seen continued offloads as well. And that is very much this trend towards maybe perhaps drinking less but drinking better quality, but certainly being able to pay for that and being prepared to pay a premium for all those brands. And that premiumization is absolutely, definitely, the most popular within the beer brands. And we're still seeing beer as 7 out of the 10 drinks that's sold in pubs today. So that's a bit of a picture on the -- of the drink spend and the premiumization trend that we see. Now wet-led pubs have been through, perhaps a bit of a shaky state in the last 20 years. But absolutely, we are seeing that change. And they are absolutely sustainable businesses now, very much in demand. And as I say, they are outperforming, and they are leading the recovery. And that is great to see. We have [ close to ] 47,000 pubs in the United Kingdom now. So we've taken out a lot of their supply there. And so what we need to see now is that growth investment. And actually our community-wet-led pubs are very well managed, and they are very robust pubs that now I can see. So we can definitely see a trend towards that now and a much, much stronger than it has been perhaps over the last 20 years. When we were looking ahead at what the trends may be in the future and certainly even throughout the crisis, we're seeing that shift towards low and no alcohol. And people are prepared to pay a premium for that. They are prepared to pay for quality, and we have much tastier beers, I have to say, in that low or no alcohol category. And it is something that we excel at as beer is as well because we have much greater flavor that we can introduce. So that is certainly a trend that we're seeing and definitely more health conscious generations are coming in, wanting to have that consumer choice and make those low to no alcohol choices as well. So that's really, really important to see. And I think that what we need to also consider is the trends, the social and economic trends that we're seeing accelerated by COVID-19, definitely staying local, staying local, working from home, preferring to stay closer to their home environment and locally with their local communities rather than going into towns and city centers. And that mode of working is also leading to people populating pubs in their local communities in the quieter parts of the week. We previously wouldn't have seen that, but it's giving them confidence to feel that they can go out to the pub on a week night. And so that is helping to also spread the trade throughout the week, which is really important to see. But there's no doubt about it. Technology and innovation has definitely come through the crisis as well. We've seen the introduction of pools of technology in order to do our track-and-trace with many of our pubs developing apps and using QR codes, but we're also going to be seeing a trend that will stay with us most definitely in terms of ordering online. And also ways that we can engage with our consumers between our consumers and our pubs, so we definitely see that trend sustaining. So leading the sector through the crisis is my daily job, and I hope that we are getting to the people that we need to get to. It is making sure that we're communicating with the government at the most highest of levels. And I do have very regular meetings with the Business Minister, Paul Scully. Also with Tourism Minister, Nigel Huddleston, who has responsibility for hospitality. I'm frequently in contact with Number 10 and also with the business unit as well as those who are leading business liaison. And they did set up a hospitality support unit, specifically because as we were hit the first and hardest throughout this to help us with our recovery. It has now become a permanent unit, and I think that is enormously important for us to have in order to make sure that we can get through this crisis and into a very strong recovery. But we do have a direct line into the cabinet. And of course, we do have that with the regional teams. We have a devoted administrations across the board. Some days it doesn't feel like it. But believe me, the conversations and dialogue is there. Now we have regular contact with our MPs as well, and that will really make a significant difference, particularly about ventures. And so we do encourage also that constituency relationship between our pubs and the constituency MPs, and that will really also have to split in the pressure on the political -- from the political side to get changes that we want. But we have had actually a member embedded in that hospitality unit that I mentioned earlier, that has given us a direct line at the BBPA into that. They reached out to us for our expertise in the hospitality sector. So I'm very proud that, that 3 months our contract has now been extended again, and we have seen Eric remaining there over the last 6 months. It's been a really, really valuable relationship and one I hope will continue for us afterwards. And of course, we're part of all the task force that are linked towards hospitality, but also the bistro economy as well. So we do have a very powerful campaign called Long Live the Local, and this have been up and running for many years now as part of our reducing beer duty campaign. But it is a consumer-backed campaign and an industry-backed to the consumer-focused campaign to make sure that we connect with our communities and help save our local pubs. They were under significant tax burden going into this crisis, but of course we hope that we will be able to reduce that tax burden on them. The campaign has been enormously successful, has resulted in 2 beer duty freezes. And we are also already campaigning for the next budget that we have now -- we're now expecting to be in February or March next year. But of course, the strat plan, Long Live the Local, very much taps into the mood of the moment, making sure we're supporting our pubs. We have an awful lot support for this, not only our owners, our consumers, but also from the politicians. And as you can see, we've already received 62,000 signatures to our petitions along with the local that has generated 47,000 letters to MPs. We are firmly on their agenda, and it will keep communicating that message to just how important the pub is to our communities up and down the country. So as a way of conclusion, the BBPA has played an active and a productive and hopefully in engagement with government and definitely has achieved this great value of support for the sector. So we hope that this will help sustain them through the crisis and into a strong recovery. We work very, very closely together. I say we have a very strong board. And having that insight at the very top level is really helping us all get through this crisis together as best that we possibly can. And of course, we have a challenge for the beer and the pub sector as part of the nighttime economy as well. And the curfew has definitely been something that has impacted on our trade. But we are working very hard on hearing very positive noises, also from the politicians and back ventures about never seeing some change to that, but of course that maybe able to take them by some announcements in the coming days. But the reality is that we have a strong group of supporters there. And that we are definitely connecting our message with them. And hopefully, that will then allow us to see regular reviews of those restrictions and also make sure we get the support we need to see us into a strong recovery. Without a shadow of a doubt, our community pubs are absolutely unique. And I think this will help them stand out in terms of receiving further support and political attention as we move ahead. This is something that is definitely universally recognized by the government. So this is something that we need to play out. And we have so much more venture first at the economy, as a boon to the economy. We add a great social value, and that will be missing. That is something that we echo in our campaigns and throughout all of our messaging. So I hope that we'll be able to make the difference in the time in between. As I say, when we went into this crisis as a thriving sector, and I hope that we will emerge from it strongly. We know that when we do demand is there, and that we can recover and recover quickly. And we can create [ 9-to-6 jobs ]. So there is a lot of incentives there for the government to keep investing in us. We contribute so much more than just economically, but also socially to our communities. And we've played our part in the fight against coronavirus. And I think that will stand [indiscernible] comment this way. That's the end of my presentation. I'm really sorry for the confusion. I couldn't see the slides there to know what you could see. But I'm very open to answering any of your questions that you may have, and I hope that you have a great day.

Thank you, Emma. That was great. Really, really great presentation. There's some questions coming in through the web box. But I think if we go, maybe, to the audio lines first, take questions from the line.

We have currently no questions coming through. [Operator Instructions]

There's a couple of questions come through. The first one, Emma, is probably addressed to both of us. So let's try and do this together. So the question is coming from Greg Johnson at Shore Capital. Greg's an analyst there. What industry-wide policies do you think the government should seek to implement and enable the pub industry to survive and thrive?

Well an immediate ask for the sector at the moment to the support that we need. Our biggest bill that we have, of course, is our labor. So the furthest team coming to an end and the introduction of the job support scheme we need to have on this tailored towards the sector. So we definitely need to do that, but we need to review the tax burden that we find ourselves under. So business rates reform is long overdue. We need to see an expansion of business rates so we've been lobbying hard to get that for the sector to support us through 2021, and that would make a huge difference as well. I mean you saw a very successful campaign to get a cut in VAT. We'd love to see an extension of that to alcohol, so it also have an impact again for pubs but also with the brewers as well. But we really do need to be tackling that beer duty. We pay 11x more tax than they do in Germany and Spain. We've also seen support packages in Germany being extended throughout the whole of 2021 and also with further restrictions being announced in France, but also seeing pledges of support come through. So we're very hopeful that we'll be able to get someone that will support the sector in the medium term, but have a long term objective such as duty, such as business weights, looking again at VAT.

Yes. I would just endorse Andy's remarks. Business rates makes a big, big difference in a pub portfolio. So we will campaign and lobby hard, with Emma leading the charge on behalf of us and the industry to extend business rates relief recurring paying no business rates up until March of next year that would make an enormous difference. Some has referred to the VAT and beer duty. If we continue to see lockdowns, whether that's localized or other -- the other thing that we will be making noise about and lobbying hard is support grants. The support grants actually were extremely important in our portfolio, particularly because we own wet-led community pub estate. A lot of the pub partners and tenants in our portfolio are small businesses, sole traders and partnerships. And those support grants were extremely important to enable them to keep going. And of course, as I referred to earlier, invest in their pubs. So when we got to reopen, they have extended trading space. And outdoors was the key there to a lot of that success. So absolutely, all of that Emma, and we will be there alongside you campaigning hard, lobbying firm to get the best support that we can from government. And you've done a really, really brilliant job. I'm not just speaking on behalf of Hawthorn, speaking on behalf of the industry that you represent. You've done a brilliant job right through lockdown to get us reopened, to obtain all the support packages that you've managed to deliver and hospitality through lockdown and beyond has had more identified support than any other sector that I can think of. So well done to you and the BBPA for that. I think we've got some questions coming in down the line.

We have a question coming through from the line of Tom Musson calling from Liberum.

My question was just answered there, actually, but maybe I'll ask a different one, while I'm on the line. And that's just thinking about Brexit. I mean, I wonder what the key considerations and maybe challenges are if the U.K. comes out the EU with a no deal, maybe particularly in relation to suppliers. I'd be interested to hear your thoughts.

Yes. Thanks, Tom. Happy to comment on this one, Mark. Yes, we have a team working on it, and I have one of my team members that focuses on Brexit and the preparations for that. We have a dialogue we've got on about the FTA that's been negotiated between the EU and the U.K. But we are continually having the conversations with them around 2 sticking points: the one on supply chain that you mentioned there, absolutely essential that we see as little change to that as possible, that it is as streamlined as it is today. We recognize the EU rating, that we can keep maintaining that in terms of the supply chain being able to get product not only in, but also out is enormously important. And I'm hearing positive noises about the negotiations in the last couple of days, which is a good thing, particularly in and around the immigration, and also making sure that we have access to skilled workforce that we need and acquire as well. So we're having proper and positive conversations, I have to say, in terms with the home office about making that workable for us, to make sure that our companies can still have access to those skills that they need. Because we don't need to have any more disruptions to that right now.

Yes. Just to add to that -- sorry, Tom. It's a good question. Thank you. Just to add to Emma's very comprehensive response. Over 90%, I think, of beer is brewed within the U.K. And I think about 99% of the supply chain is within the U.K. borders. So Brexit is not a complicated issue for our supply and distribution chain. And Emma and the team, as you can tell, and my team as well, have a very detailed plan to accommodate whatever's thrown at us on the 31st of December. Thank you, Tom. That was a good question. I don't think there are any more questions coming through the -- through the telephone. So there are a few -- quite a few, actually. We're not going to get through all of these, but there's a few questions coming through the text box. A couple are very good, actually, because we're actually going to deal with them later. We'll talk later about our pub sales. Specific question is from Yusuf, one of our shareholders at Belfield Capital, about the level of sales in our estate after 10:00 p.m. We've got a specific slide on that. So I'll be talking about that later on. Your second question is about the number of pubs we have in Scotland. We've also got a slide on that later on. So we will cover that and restrictions and what we think that means for our business. [Ottman] from M&G, thank you for asking a question. You've asked what percentage of the NewRiver portfolio would we like to take our community pub business. We're currently around 23% today of the total NewRiver estate portfolio in community pubs. We have said publicly in all the guidance on our policy, we'd be quite happy to see that increase to 30% or possibly more. We are, of course, a REIT, real estate investment trust. So there are certain rules and guidance that we have to operate within from an investment and from a tax perspective, that does provide certain restrictions. But I'm sure one of the key themes that you will take away from today, that Hawthorn as part of the NewRiver group is an ambitious company. There will be great opportunities for us to develop, to grow earnings and create value. And there is capacity within the business to do that. We'll also talk to you today about some of the ideas that we've got to fund acquisitions should they come our way because I think it's quite inevitable that there will be some opportunities if not this year, certainly early part of next year. So thanks for that question, [ Ottman ]. And I think that's probably all we've got time for now. There are some more questions. Is there one coming through the line? No. We're going to call that session to an end. We're bang on time, which is good. I did tell you we were going to be efficient with our time today. So we've got off to the best possible start. Thanks again, Emma. That was a great presentation. And on that note, we're going to move on to the financial and performance update. I'm going to pass on to Matt, who's our CFO at Hawthorn. Over to you, Matt.

Thank you, Mark. Good afternoon, everybody. I'm Matt Ward, CFO of Horton Leisure. I also want to thank Emma for a very insightful interest in presentation this afternoon. Now it has provided a good backdrop for the next few slides, which will cover Hawthorn's performance and its recovery. This afternoon, I will begin by giving an overview of the financial position of the business for the last financial year and the activity we took as a team to protect the business during the lockdown. I will then pass over to Mark to provide an update on the current performance and set out the key priorities as we navigate through the current pandemic. Firstly, I would like to share with you an overview of the Hawthorn business. The slide outlines the position of the business as of the 30th of March, our year-end closing position just after the national lockdown on the 20th of March. At the end of March, we had 720 pubs, with 80% operating as leased and tenanted and the remainder being operator managed. The team will explain the key differences between the 2 operating models later on in the presentation. We added 70 new sites during the year through 2 acquisitions, 1 from Bravo Inns in December 2019, and a small package from Marston's in January 2020. Our estate is over 97% freehold. And as you can see from the regional breakdown, we have pubs located across Scotland, England and Wales, with the highest conurbation sites currently located within the Midlands and the northwest of England. The value of our property assets was GBP 281 million at the year-end, which represents around 23% of NewRiver's total portfolio, as Mark said. And this equates to an average value per pub of around GBP 373,000. As Mark said, last year, we had a good performance with our like-for-likes growing by plus 5.9%, and this was immediately proceeding the lockdown period. Due to the trade disruption caused by the pandemic and the resulting lockdown on the 20th of March, we ended the year reporting growth of 2.2% after taking account of provisions and trade impacts in that final month. Overall, our outlets' EBITDA before admin costs was GBP 24.3 million. However, when adding back the financial impact of COVID-19 in the final month, this increases to GBP 26.7 million, as you can see on screen. I will run through how this was achieved in the next slide. The KPI performance to March was very healthy. We have good levels of occupancy cost -- occupancy levels across the estate at 97%. We also continue to build our beer sales within our pubs, annualizing at around 115,000 barrels. And this led to further supply chain synergies being achieved during our negotiations from -- with key suppliers. The business also continues to generate good levels of return on capital, achieving an ROI of 16.9% on the 131 projects completed since the Hawthorn acquisition since May 2018. Our acquisition returns were also very strong, generating unlevered IRRs of between 11% and 25% as shown in the final box, this underlying our ability to buy well, integrate and improve profitability from our acquisitions. So overall, a strong set of KPIs going into the lockdown. The next slide is a recap of the key movements in outlet EBITDA achieved last year to the end of March '20. The left-hand side of the waterfall may be familiar to a number of you already. It shows the component parts of Hawthorn's EBITDA and that which has grown during the year. In terms of growth steps, you can see the strong levels of like-for-like income, GBP 2.2 million or 5.9%. This was primarily driven by scale-based synergies achieved through the integration of Hawthorn Leisure in January 2019. The next 3 growth steps give a combined increase of GBP 3.6 million and include the full year benefit of the Hawthorn acquisition of GBP 2.3 million, GBP 0.6 million from a portfolio of pubs acquired from Heineken and finally, 3 months of Bravo Inns, which was acquired in December 2019. The downward steps primarily relate to reduced EBITDA from sold assets, with 30 pub sales completing during the year at an 11% premium to book and 14 C-stores being disposed off of GBP 16 million at a net initial yield of 5.2%. You can then see how COVID-19 impacted the business in the final month, taking the EBITDA down to GBP 24.3 million, the impacts being GBP 1.6 million of rent and stock provisions relating to rent unlikely to be collected and stopped wastage due to closure and GBP 0.8 million related to the direct trade disruption and closure impacts leading up to, following the close on the 20th of March. Finally, I thought it would be helpful to share some thoughts on the growth drivers that are still evident in the Hawthorn business even after the pandemic has hit. As you'll be aware, NewRiver has suspended all future guidance so the following shouldn't be interpreted as guidance, but more as a direction of travel. The first being the reversal of the ongoing COVID impacts. You will naturally want to make your own assessment in terms of timing and amount for these. But as you've heard me talk about, these costs, by their very nature, are one-off and exceptional. The second driver is the annualized benefit of the 2 acquisitions we've recently made, 1 from Bravo Inns acquired in December; and the second from Marston's acquired in January, which between them generate around GBP 3.5 million of EBITDA. With the business being closed during the first quarter, we are now only seeing the benefits of these acquisitions. The third is our ability to continue to generate healthy returns on investment from our capital investment program, our active asset management program and our other operational initiatives. You will hear more on how we do this in practice from the team later on in the presentation. So overall, the business was in very good shape going into lockdown. So what was our experience during the lockdown? I'd like to talk you through some of the measures we undertook during the period to protect our business. Our overriding priority was -- during the closure period, was threefold: one, to protect our people second; second, to protect our business; and third, to protect our property. We did this through a series of measures focused on protecting the P&L and balance sheet and supporting our partners and operators. It was important that we protected our cash position and put ourselves in the best possible position to bounce back strongly and gain market share when pubs finally reopened on the 4th of July. We accessed all available grant support packages this included furloughing around 79% of the team and applying for retail and hospitality grants, and we also directly benefited from over GBP 1 million with the rates relief in our operator managed business. On rent collection, we work proactively with our pub partners to help them access grants at the appropriate time. And then at the appropriate time, we collected rent. Our rent collection during the closure period was 40%. In return, we provided support credits to partners equivalent to 2 months of rent-free for July and August. This was designed to help partners recover fast and build their cash reserves soon after reopening. On cost control, we took sensible measures to reduce discretionary spend, cutting back our capital plan from GBP 15 million to GBP 2 million, negotiating contract freezes and targeted reductions in our operating expenses. To date, we have secured reoccurring cost savings of around GBP 750,000 through our renegotiations. Finally, we focused on our asset recycling, disposing of 14 sites, which generated GBP 5.1 million of cash proceeds during the lockdown. Another key priority during lockdown was to support our partners and our tenants. Through the communication and support of our operations team, partners were able to access around GBP 9 million worth of government support, vital cash for them to continue to pay their bills and survive. Using this money, we actually saw a significant amount of investment going to our estate with partners using a proportion of their grant to improve the customer proposition. Whether that be simple decorations or invest in outside space to increase capacity for when customers returned. Around 86% of partners invested during lockdown which has improved the overall condition of our estate. We firmly believe by supporting and retaining partners during the pandemic, the business will recover quickly and the feedback from our surveys tells us that 97% of partners said they were either satisfied or very satisfied with the support they received from Hawthorn. Finally, the combination of all these measures actually resulted in Hawthorn being cash positive during the lockdown, with our cash position improving by GBP 1.4 million between March and the 4th of July. An important part of how we protect our business was the dialogue we maintained with our key suppliers. As Emma said earlier, the way the industry pulled together joined lockdown was excellent and Hawthorn played an active role in working through the challenges that the industry faced. Hawthorn has very good relationships with its suppliers. And this was an important factor during the closure period, not least around working together to manage our respective cash flows, but also managing complex areas such as beer disruption and restocking ahead of the property opening. You can see from the chart with our -- who our key relationships are with and the mix of their products within our estate. We have good relationships with all 4 suppliers for the purchase of product. And Marston's and tenants also carry out the distribution for our pubs. Marston's in England and Wales and tenants in Scotland. By working closely with our suppliers during lockdown, we extended our term to carefully manage our credit payments. This was done in partnership, and in some instances, we actually brought forward payments to them. We believe by investing in strategic relationships with key suppliers who have well-developed product portfolios, it does unlock and add significant value to the business over time. The strength of these relationships allows us to deliver synergy benefits as the business grows. And we have a solid track record of delivering on this. And last year alone, we unlocked GBP 2 million of the margin improvements through these negotiations. Before passing on to Mark, I just wanted to share with you the balance sheet and cash flow for the Hawthorn business. The balance sheet shows the picture as at the 31st of March 2020. And you can see the business has an extremely robust balance sheet. We have no debt, and all our assets are fully unencumbered. Our property assets were valued at GBP 281 million, and are independently valued every 6 months in mark-to-market by Colliers International. Given the nature of our business, we do not carry high levels of inventory, and our active debt management means that our trade and other receivables are relatively low. The business is highly cash generative. And as you can see, we held cash reserves of GBP 9.3 million at year-end. This has since improved, and I'll talk you through the key movements on this on the next slide. We have a clean and prudent capital structure with no borrowings. This has meant that the team have been fully focused on managing through the pandemic and focused on business recovery during the recent months. We believe our balance sheet puts us in a unique position coming out of the lockdown, unlike many other businesses in the sector, we haven't had to take on any more debt to fund ourselves during this period. This could naturally lead to opportunities for Hawthorn as other pub companies have no choice but to sell good assets to help their ongoing liquidity. Moving on to cash flow. Also, this slide, we're very proud of, actually. The cash flow shows the movement in cash from the end of March to September, which has increased by GBP 9.3 million. As you can see, we have generated cash inflow from our operating activities with our trading profit already back in positive territory. We have seen our working capital improve, this driven by our cash receipts coming in at a much faster rate than our creditor payments, which on average are 45 days. You can also see the government support many received through the combination of job retention and the retail and hospitality support moneys. Whilst we've cut back on discretionary spend, we haven't completely battened down the hatches. We have continued to spend on capital projects focused on the completion of the development project, accretive developments and health and safety-related schemes. We have also upgraded our financial ERP system. During the lockdown, spending GBP 300,000 on this upgrade. Our asset recycling program has also continued with 19 pubs being sold and 2 C-stores being sold in the first half, generating proceeds of over GBP 7 million in that first 6-month period. So the business is highly cash generative. During the first half, we were able to increase our cash position by GBP 9.3 million, and we haven't taken on any further debt. This has highlighted our ability to recover quickly and adapt to the ever-changing market conditions being caused by the pandemic. Our cash position puts us in a great position to navigate through the next phases of the pandemic and recovery quickly moving into next year. I'd like to thank you for your time, and I'd now like to pass back to Mark to cover our current performance.

Thank you, Matt. That was highly comprehensive. I think actually, it's a great achievement, to being cash flow positive during a lock down and to improve our cash position even further since we were open by returning to profit so quickly. So well done to Matt and the team. I'd just like to take a moment just looking back actually and focusing on -- briefly on lockdown and our bounce back plan. Lockdown was a challenging time for me and our senior leadership team, though I feel have done a terrific job at maintaining our focus and delivering strong results. We've kept our people highly motivated. We've improved the property condition and outdoor space capacity during lockdown and bounced back to profitability very quickly. We were very well positioned for the reopening of the estate on the 4th of July and our bounce back performance clearly demonstrates this. You can see from this slide, we have a 4 stage plan to recover, and both Andy Parker and Mark Brooke, our operations directors, will be talking us through this in detail later. We have successfully executed the first 2 stages of this plan, and our focus now is to navigate our way through the new restrictions, the winter period and continue our recovery into the spring of next year. I've been hugely impressed by how quickly our performance has bounced back. You will see this on the next slide. Now clear -- this is a reflection of the great team effort and the detailed planning work that was done, but also an endorsement of the community pub business model and the robustness of a local and suburban community pub portfolio. Now the next slide is a brilliant slide for me and my team. It demonstrates the great job that we have done and the quality of our portfolio and our asset management capabilities. The chart shows the weekly like-for-like performance for our portfolio since reopening, compared to the same week in the previous year. For our lease and tenanted portfolio, the dark blue line on the chart and our operator managed portfolio, the light blue line on the chart and also the market average for pubs and restaurants, which is measured by the copper peach tracker, that's the pink line on the chart in front of us. The first point I'd like to make is how quickly we bounced back from lockdown on the 4th of July. Within 4 weeks of reopening, we were trading at 91% of prior year sales in leasing tenanted and 85% in operator managed. We outperformed the market by some way in July, then Eat Out to Help Out came along, which provided a big boost, of course, to the hospitality industry as a whole. We don't do food in our operator managed business. However, you can see that we held firm around about the 90% level of last year. In our leased and tenanted state, where we do have food, improved to the -- be trading ahead of last year, almost through all of August, in fact, peaking at 103% of last year in the third week. I think that's a formidable achievement by the team. The other pleasing factor about this slide is the consistency and sustainability of our performance and the cumulative effect of our portfolio, which for us is in leased and tenanted, 92%. That's our average like-for-like performance since we opened on the fourth of July up until the end of September, 84% for operator managed like-for-like average since we reopened on the 4th of July. And this, of course, compares favorably, as you can see from the chart on the right-hand side, the pink circle, 82%, and on average, according to the copper peach tracker, which does, of course, include city center pubs and bars, some of which have struggled to bounce back from lockdown, as Emma referred to earlier on. But because our portfolio is community and suburban, and people are working at home and staying local, our performance is ahead of the market and I'm sure you'd all agree that our reopening performance has been very strong. So the previous slide is all about sales and strong performance. This slide clearly demonstrates the importance of profitability. Now we've performed way beyond our initial projections. We've performed ahead of the market and, therefore, well-placed to tackle challenges that lie ahead. Sales are important, of course, but so is profit. The purpose of this slide is to show the reward of our efforts. We have returned to profit quickly, as you can see in the bottom left. And you can see for last month, our group EBITDA of GBP 1.9 million was actually within 10% of the previous year. Now given the local lockdowns that we've had to respond to and a range of guidelines that we continue to face, I think this is a great team effort and a highly profitable performance. Before I finish up on this part of the presentation, I'd just like to take a moment just to talk about are we are tackling some of these ongoing restrictions and hurdles that have been put upon us recently. Now I've already described in detail on the previous slide, how strong our performance has been and how consistent that performance has been since we reopened. But 2 weeks ago, the government announced a curfew of 10:00 p.m. and a range of new measures were yesterday announced. Pretty harsh guidelines and lockdowns were introduced in Scotland. By the BPPA, we have been alert to such changes and been able to quickly react. We've had many of these local issues to deal with since we opened in Lester, Aberdeen, Bolton, many, many parts of the north of England have had localized issues for some time. But we do own a diversified portfolio across the U.K., and this has enabled us to mitigate our exposure to some or all of these localized issues. However, when we look at the curfew, and we can see from the slide in the -- on the left-hand side, this is a slide which sets out according to Cantor Research, the percentage of volume sales in pubs and other hospitality units, the level of sales after 9:00 p.m. each day. Now you can see from this that community pumps, which averaged 17% after 9:00 p.m., the reason we put 9:00 p.m. in here, not 10:00 p.m., is even though the curve is at 10, depending on where you are in the country, that last orders rules are working differently. So typically, 10 p.m. is a hard close. In our portfolio, that's the Hawthorn portfolio, we are actually at 15%. So quite close to where the community pub average sits. So you can see quite clearly that the impact of the curfew is and will continue to have less impact on the owner of the community pub portfolio business such as ourselves. On to Scotland, following the announcement yesterday, we'll do everything we can, of course, to maximize revenue and reduce costs during this time. Our Scottish portfolio has been high performing, actually, and It was trading at 88% of last year prior to yesterday. There have been a number of restrictions in Scotland for some time. When we first opened in Scotland, actually, we could only trade from outdoor space. Our pubs are principally located in suburban locations in and around the major conurbations of Glasgow and Edinburgh that you can see from the map on the right-hand side. Now the team are already working on the bounce back plan for the 25th of October. And we've proven before, we bounce back strongly, and we will do it again. In spite of these conditions, new conditions, the team remained upbeat and positive. The speed of response has been excellent. I've seen firsthand following yesterday's announcement that a full lockdown pack was distributed to our team last night. All of our partners and operators received that pack before 10:00 p.m. last night. So we're ready to respond to that at 6:00 p.m. on Friday. I'm sure there'll be more questions on this. It's a topical issue. It's a live issue and one that we're dealing with. And that brings an end to the financial and performance update. On that note, I'll be really delighted to take any further questions to myself or Matt. Before we pass on to our operational colleagues, who are at the Eagle and Child pub, near Manchester, which is one of our high-performing operator managed community pubs. So if we can go to questions, please.

There currently are no questions in the queue. [Operator Instructions] And we do have a question coming through from the line of Andrew Gill, calling from Jefferies.

Thanks, Mark. I assume the last valuation, the value has sort of assumed a certain near term earnings. It obviously, you and the team have demonstrated that you've performed very strongly. So I mean, obviously, it's a big question against the uncertainty over the next few months. But is it fair to assume a certain amount of that earnings base devaluation that we saw in March could start to reverse in the second half of the year?

Thank you, Andrew. Really good question. We're obviously at a close period currently, going through a valuation process. So we haven't given a detailed update on valuation today. Of course, we'll do that next month with our half year release. But what I can say to you today that when we undertook our year-end valuation for 31st March 2020. You rightly pointed out, Andrew, that there were some adjustments made, reflecting the fact that we were in a lockdown at the time of that valuation. We saw a decline in value of 8%, which related absolutely specifically to COVID. The delinquency assumptions that the value is made -- all of our estate, by the way, is valued independently every 6 months, that we've outperformed. So on paper, and in theory, we will start to get some of that valuation movement back at some point. Now I don't know for sure whether that will be at the half year review or it's going to take us a little bit more time to be able to do that. All I can say is we've outperformed those assumptions that Colliers has made around how long it would take to get back to the current trading level. There are clearly some hurdles that have just been put in front of us, particularly in Scotland, where we have a really, really good estate. And all of that, of course, will be factored in, in due course. But our portfolio valuation is stable, in my opinion. And when we get to the property section, later on, you'll see there's a lot of embedded value not reflected in today's valuation, and Ed's going to talk about that value creation piece later. So I think that addresses the question, Andrew, that you asked. Time will tell whether I'm proven right on that or not. But I don't think I'm going to be far off because, well, you've seen the performance numbers. They clearly demonstrate profitability and sustainability. And I think that will get reflected in the valuation when that's released audited in about 5 weeks time.

There were no further questions in the queue.

Thank you. We have some questions that have come through the web. First question is from Greg Johnson, again, at Shore Capital. Greg is asking the pandemic is likely to lead to more attractive pub assets coming on to the market. Where I need to provide -- suitable to Hawthorn, how would you envisage funding such potential acquisitions? Would you be able to continue to benefit from the REIT structure? Well, I could answer that, but you could answer that as well, Matt. Do you -- why don't you have a go at that?

Yes. Sure.

You can see this on screen.

All right. Okay. Yes. I think, as Mark has said earlier, the balance sheet of NewRiver, our parent is extremely strong, and we've got access to the cash reserves within that. And Hawthorn as well is fully unencumbered and has no debt. One of the things that I've always admired in NewRiver actually is their ability to think differently around raising capital. So I know there's a number of JVs, particularly the one with Pimco which has resulted in their ability to grow and scale under that joint venture format. So that could be something that we look at. But we will obviously have access to the new group and our own cash, but we want to grow, and I think we'll carefully look to raise capital. And what we've proven in the past is we can buy well. We will buy well. We're quickly integrating the assets, and we deliver synergies. And on every transaction we've done recently, we've managed to unlock the synergies. So it's certainly something that we'll be looking at going into the new financial year. We've got our priorities now in terms of navigating through the winter. But certainly, our eye is on 2021 and how we can go about that.

Thanks, Matt. I think that Greg answers the question spot on. I'm not sure I can add any more to that. So with one further question that's come, we're slightly over on time. Again, from use of -- I'll deal with it because it's a short one. Our pub's cash -- your pub's cash position benefited from disposals in the first half. Do you expect this to continue in the second half? Absolutely. We will continue to recycle assets that we feel are not in line with our strategy. I made reference to that earlier. Sometimes we've taken the value and feel it's best to generate cash. Heads here view in the room with us today. We'll talk about disposals in a moment. But I was so pleasantly surprised that during lockdown, we seem to be selling 1 or 2 pubs a week. These are pubs that we don't see as core. And therefore, that's why we're seeking to sell them. So even in a lockdown environment, there's always somebody out there that seems to be willing to pay good money to buy their local pub. I don't think that's ever going to change actually. So we'll continue to recycle. It's what we've always done. I think I made to reference to this earlier, we've sold in excess of 100 pubs. And if it doesn't fit our model, then we will sell. We're nearly out of fully managed now, which we've got 1 to go, and that will take us out of that segment completely. Strategically, that was definitely a smart thing to do. And took a lot of employment costs out of the business coming into lockdown. So we're always looking at our portfolio. We do the 6 monthly estates review. We have the next 1 coming up in a few weeks. And we look at every asset line by line, if it doesn't a fit model, we'll sell. And that will continue. And of course, as you rightly pointed out, you saw it generates a very good cash flow for us. On that note, we're only a couple of minutes behind. We're going to move now onto the operations section of the presentation. I introduced earlier on the team's slide, Andy Parker, our Director in charge of lease and tenanted operations; and Mark Brooke, our Director in charge of operator managed. They're dialing in from the Eagle & Child. It's a brilliant pub just outside of Manchester. It's wet-led. So I'm hoping they're dialing in from the meeting room, not the bar. And on that note, I'll pass over to you, Andy, and to you, Mark.

Thank you, Mark. It would appear not only all the clubs in the Northwest being subject to restrictions but the Wi-Fi has too today. So apologies, if you can't see me on screen. Good afternoon, everybody. My name is Andy Parker, and I, together with my amazing team, am responsible for the strategy and performance of our leased and tenanted business, which comprises almost 550 mostly community-focused pubs from Inverness down to [10 Downes] I would like to provide you with a brief operational update about our lease and tenanted portfolio. I have worked for Hawthorn Leisure since the beginning, and I am incredibly proud of way in which we have grown and developed this business over the last 6 years. In our lease business, we rent out our community folks to entrepreneurial business people, who we call partners, for them to operate their own independent business based on a plan that they create and implement. In the leased and tenanted bottle, Hawthorn earn income by charging a rent for the premises based on the theoretical trading potential of that pub in that location with the right retail offer and in the right condition. This is called a fair maintainable trade. In most instances, our partners have tied to purchase all of their beer, cider and packaged products from Hawthorn, and we also make a margin on each of these sales. In addition to this, we share a split of the income from our free machines, pool tables and juice boxes from each pub with our partners and suppliers. Additionally, in this sector, the relationship between landlord and tenant is very transactional. However, at Hawthorn, we've worked exceptionally hard to change that perception. Our business development managers have one of the lowest pubs-to-BDM ratios in the least in tenanted market at an average of just 35 pubs each. This allows them to forge brilliant relationships with our partners, which in turn allows them to provide increased support and advice to help them get the most on their business opportunity. Over the next 10 minutes, I'll explain how we bounced back from lockdown exceptionally well and how we plan to capitalize on this for the future. No business has ever had to plan for a full-scale lockdown across all parts of the economy and all the challenges that this brings with it. The 4 stage plan that Mark touched on earlier, was key to navigating the crisis and bouncing back as strong as possible. Our #1 priority was to retain as many partners as possible during the lockdown and to be in the strongest possible position when we were able to reopen once again. To achieve this, we needed to do something different in order to support our partners from the direction of travel that our competitors are taking. We were able to use the financial strength of the business that Matt and Mark spoke about earlier to minimize the impact of the lockdown in partnership with our pubs. The key message we quickly instilled to our partners was that we were all in this together. By focusing on each pub individually, we were able to understand the levels of support required on a pub by pub basis, and this strategy allowed us to collect almost 40% of the rent due during the closed period, a quite remarkable achievement. It was also during lockdown that the relationship between our BDMs and partners grew even stronger. Being locked down in your pub with no customers day after day was challenging for our partners. Our BDMs were in touch each and every week to check in their mental well-being and put them in touch with one another to share experiences and plan for a brighter future together. As we move towards reopening our business, we bought our BDMs back and furlough as soon as it became clear that we will be opening up looks towards the end of June or in early July. This allowed them to visit every single pub and to be able to work with the partners to put COVID secure measures in place and to prepare fully for reopening. Our marketing team provided point-of-sale to help guide our customers around the pubs and we delivered PPE to help keep staff and customers safe. We also agreed that where pubs have paid the rents due during lockdown, that we would not ask for any rent payments during July or August. This allowed the pubs to focus fully on reopening their businesses and delivering the best customer experience without having to worry about where the rent money would come from. This, along with practical how to guides, has undoubtedly driven our performance since reopening, which I'll share with you later on. As we've moved into the phase of more recent restrictions, we quickly communicated with our pubs to reassure them about how we would treat the potential local and professional lockdowns being carted across the press and social media. This, along with our continued strategy providing financial support on a case by case and pub by pub basis has given our partners the comfort of being able to drive their businesses as hard as they can. Further to this, we launched an innovative joint investment scheme, the Pub Partner Investment Fund at the end of September, where we have encouraged our partners to invest hand-in-hand with us to increase capacity in their pubs and to maximize income opportunities under the current restrictions. We will match investment from our partners to a maximum level of GBP 5,000 each to improve the pub for the future. Applications to date have included outdoor seating, heating and lighting solutions, long-term marquee hire and plastic barriers to allow more customers to sit within 1 meter of 1 another internally. This is a great example of thinking differently and whilst many businesses look to pull back spending, it will give our partners an opportunity to future-proof their businesses whilst we both share the financial costs and the rewards together. As we plan to come out of these restrictions in a post COVID world, we are looking to attain and further these building relationships and to move the business back on track with our future growth drivers that Matt shared earlier as quickly as possible. We will achieve this by delivering a strong growth agenda, which is based on retaining great partners running our pubs, embedding in the assets where appropriate in order to drive further sales opportunities and by providing great initiatives and training to help our partners deliver the best business plans possible. With a marketplace that has been in a state of constant flux over the last 6 months, it has been vital that the operations team has been fleet of foot and able to adapt and evolve for the circumstances in place at any time. By sticking to our 4 stage plan, we've been able to ensure that all activity has underpinned our key areas of focus, which were as follows. As stated earlier, our #1 priority was to ensure that we retain our great partners in our pubs. We have achieved this by being better than our peers in the marketplace, and this has been validated with our 97% approval rating that Matt shared with you earlier. We have been sincere and transparent throughout the crisis, letting our partners know where they stood at all times. We've demonstrated that we are in this together with our partners, resulting in their investment and commitment to their pubs in a time of great uncertainty. We've not been appraised innovate to do things differently to ensure that we are best placed to emerge stronger from this pandemic. Secondly, we have built confidence in our partners to overcome the challenges that they have faced with a can-do attitude which has been passed on from the entire team across the business. This has been achieved through constant communication and creating a culture of sharing best practice between all areas. Thirdly, we encouraged and rewarded investment by our partners to drive capacity and trade opportunities in their pubs against the backdrop of tightening belts across the sector. I'm especially proud in the way we have implemented the rent support tailored to the individual needs of each pub and launched innovative programs such as our Partner Investment Fund. Our fourth priority has been to work with our property team to quickly identify and prepare capital investment opportunities to ensure that in a post-COVID world and with a new normal, that our community pubs are best placed to take advantage of changes in consumer behavior. This is specifically sensitive towards developing outside space opportunities, bringing on new space back into play, and the evolution of the retail offer, including the introduction of food offers and creating community assets such as village shops or tea rings in unused parts of the building. As Emma McClarkin stated earlier, providing community resources and making pubs relevant to their environment is crucial to our long-term success. Finally, we will actively look to capitalize on the goodwill generated by the support given to our pubs during lockdown. Specifically, we will look to lock in great partners on longer-term deals and to convert those who have joined on temporary agreements on to substantive terms. The entire business has a clear can do attitude. We will emerge from this situation stronger as we continue to adapt, evolve and overcome the challenges laid down to us. The following slides demonstrate just some of the amazing things our pubs have delivered during lockdown. The pub on the left-hand side is at Turf Hotel, which is the only probe in the U.K. connected to a football stadium, in this case, the Wrexham Football Club. Those of you who follow social media will be aware that we may well see Ryan Reynolds buying a pint of the bar any day now. Wayne, the partner, has run the pub for 7 years. In September 2019, we completed a GBP 47,000 investment in the site to modernize the inside and improve the bar servery area to allow more customers to be served on much days. In terms of this, we were able to lock Wayne into a new 5-year agreement where we rebased his deal to allow him to be more competitive on his pricing versus his local marketplace. During lockdown, Wayne had the confidence to invest GBP 25,000 of his own money, creating 2 outside seated areas on the front and rear with the pub, featuring heat, lights and TV to stay up-to-date with the latest football. Result of this has seen Wayne selling 50% more beer than during the same period in August 2019, and he's quickly seeing a return on his investment. The hearty good fellow on the right, [indiscernible] was closed at the start of lockdown. The previous partner had moved on, and we were talking to stake in a new partner about taking the pub on just as the virus hit. Despite the uncertainty, she left a full-time job as a manager of our competitor's pub down the road and take the plunge to work in partnership with Hawthorn. Poised by the relationship she had built with our BDM, Ali, she decided to invest in the entire pub during lockdown, decorating throughout and making the garden a place to really enjoy a nice refreshing pint in the sun. She invested GBP 16,000 in total, all of which we contributed a further GBP 5,000 to get the pub fully stocked and ready to open. Engagement with the community and excellent retail standards and service have seen sales reach 200% of those seen in the same period in 2019, a great partner, running a great community pub. The pub on the left in level arms in the village of Kinoulton in Nottinghamshire has been another success story. Trish, the partner, moved into the pub in January 2019 and took on the challenge of reengaging the community pub, which had fallen out of love with its local. With her great suit, unmistakable service, and her local celebrity dog, Remy, she quickly established the pub back at the heart of the community. During lockdown, she brought the horse back as you can see. And at first, ran it as a local takeaway and shop offerings, fresh and baked bread and homemade food from the above kitchen to the local community. Since the opening, she's remodeled it with gym bar and the car park for extra tables, and small marquees provide shelter for the customers. Sales are up 35% on the same period in 2019, and Trish is about to sign a 5-year tenancy to keep her in the pub until 2025. The pub on the right is the red line in the [indiscernible] mid-Wales. This is part of the Humber from Marston's in January 2020, just 2 months prior to lock down. Sam and his wife Aga moved across to a Hawthorn agreement, which gave them the freedom and flexibility to run their pubs to the local community. There was a fantastic secret courtyard and unused space in the rear of the property, which was just crying out for investment. Relationships with Alex, the BDM and build for Sam and Aga, along with a commitment from Hawthorn to invest in the external periods of the pub gave Sam the confidence to invest GBP 12,000 himself, creating a spinning rear garden and courtyard with a new outside bar. Even not local artists to help paint it, keeping the community-focused on the pub. Sam tells that the sales are up 1/3 on the same time last year and he is preparing this business plan to allow him to convert to a new 5-year tenancy. Having an ethos and a philosophy is all well and good, but it has to translate into tangible performance. I'm incredibly proud of the results we have delivered since [indiscernible] and I'm clear that these are down to the way in which we have navigated these unprecedented times as a management team. As you can see from the graph on-screen, that as we opened the various parts of this leased business across the U.K., we saw performance quickly increase as confidence from our partners to operate their businesses safely and securely was passed on to their customers in their local communities. We have seen cumulative sales at 92% of the previous year's performance since reopening has been exceptional. On the 16th of August, when the last part of our estate was legally allowed to trade, which was the inside space in our Welsh pubs, we have 95% of our pubs open and trading. That number is now 98%. Despite the further recent interventions by government across the hospitality industry, including those announced in Scotland yesterday and those as reported in the news today to the remainder of the U.K., performance of the leased part of the business continues to be incredibly resilient and robust. We have benefited from the hard work that we have all put in during lockdown and whatever is thrown at us from the developed -- governments, we have shown that we can overcome it. To give some clarity to this, our industry standard flow monitoring system, which is provided by Vianet and which is implemented across the leased businesses in the U.K., has allowed us to quickly measure the performance of our business versus the peer group, which contained a further 9,000 leased and tentative pubs across the U.K. This data shows us that we have outperformed that marketplace for 11 out of 13 weeks since reopening, including the last 6 weeks in a row, quite outstanding results. And to want to pin a comment from them earlier, we are seeing premiumization across the estate with brands such as Birra Moretti and Estrella being delivered to our leased pubs and double-digit growth for our customers to enjoy. We have achieved our goal to retain great partners with 89% of those who are running their pubs on the 20th of March, the infamous lockdown night, still in situ in their business. This is testament to the excellent relationships we have built, and the fair treatment of our partners throughout this challenging period. We have managed to balance the need to keep our partners businesses running whilst allowing them to be able to pay their fair share of rentals and in September, we collected 86% of the rent due, a great performance. We have continued to see the benefits of the investments our partners made in their pubs during lockdown, but are now looking to further that opportunity with our launch of our partner investment fund I spoke about earlier. This will encourage further hand-in-hand growth to maximize internal and external trade areas, so we are well placed to navigate the difficult months ahead before restrictions are finally lifted. Myself and my team are extremely positive about the position we are in and are well set for the challenges that lie ahead. Thank you. If you have any questions relating to this, please type it into the webcast box, and we will answer them after we've heard from Matt Brooke, Adviser, Operator Managed Business.

Thanks, Andy, and good afternoon, everyone. I'm Mark Brooke and I have the pleasure of leading the operator and managed part of our business. And as our CEO mentioned earlier, I'm a new addition to Hawthorn team, so I thought I would take the opportunity to share with you why I joined Hawthorn. It's pretty simple. I wanted to be part of the #1 community pub company in the U.K., and I firmly believe that Hawthorn is the platform to achieve this. Hopefully, over the next few slides, we'll be able to share with you how we set ourselves up to recover quickly and safely, but at the same time, share the exciting journey that we're on. Moving on to the first slide. The operator managed estate is an integral part of the Hawthorn business. And as you can see, at the end of March 2020, the estate had 126 pubs. This has grown in recent months by a further 26, taking it to a total of 152, which represents 21% of the total Hawthorne state. We have managed pubs in England, Wales, Scotland, although the majority of the pubs are now in the Northwest. We have a dedicated team that service these pubs, which comprises of an operations director and 6 business development managers who, on average, are responsible for 25 pubs each. We convert L&T pubs into our operator managed pubs because if done correctly, it will improve our EBITDA, which, in turn, will improve our book values. Another important reason is we control the range, pricing and marketing, and this allows us to be more competitive in the marketplace at all times. And for the benefit of everyone on the call, the key difference between our L&T and operator managed model is in operator managed, we are responsible for all property matters, pay all the associated bills to trade the pub, and we pay the operators, on average, 20% of the net turnover as a service fee. The operator is set up to trade as a limited company, is then responsible for all the employees and any associated costs. We do not employ any of the staff in operator managed. As Andy said earlier, going into full lock down was unchartered waters, and the speed of recovery would depend on how good our reopening plan was and how well we executed it. Operator managed followed a similar 4 phase approach that was applied to L&T pubs. Phase 1 during lockdown with our operators, we discussed on keeping engagement levels high through regular contacts and providing updates and guidance. We kept our operators motivated and busy by supporting on a pub by pub basis with a number of improvements so that when reopened, up pubs, they look their best. We also put in place a weekly support team to support our operators during lockdown. This support was kept in place for the full 15 weeks. It is important to note that we've had incredibly positive feedback on how we've supported our operators during this difficult time, and that is reflected in great retention levels. We have managed to retain all but 3 of our operators, which is a remarkable achievement. With our customers, we ensured that our customers are kept up-to-date via social media and word of mouth. Wherever possible, our pubs engage in community activities such as food banks, taking deliveries to people who are shielding and raising funds for people who have been affected by the lockdown. During the 15 weeks of lockdown, communities have been brought together more than ever, and pubs, especially community ones, have played a major part in this. Phase 2, when we are reopening, our priorities was to ensure that we were able to open safely and provide a safe environment for both our operators and our customers. We provided comprehensive guidance, a relaunch kit, plenty of good quality PPE, a QR code track-and-trace process, risk assessment and BDMs personally made sure that every pub is COVID-safe before they reopened. We've had some really great feedback too from our customers on how we've improved their pubs during lockdown and on also how we've made them feel safe when they've returned. Phase 3 and 4 split into 2 key focus areas: investment and growth. Starting with investment, I will now provide more detail on what these key focuses are. We start with people as we always do in Hawthorn, we will be investing in our BDM operators in 2021. We will be making sure that every BDM is equipped to support our operators brilliantly and that our operators are able to deliver a great customer experience. In July this year, we launched an online training platform for both our BDMs and operators, and we'll be supporting this with a range of classroom and in-the-pub training sessions. To deliver targeted CapEx brilliantly, we have created an investment template for all our operator-managed conversion and growth investments. This will ensure that when we invest the right amount of money into the right areas, it will allow us to unlock existing income opportunities. During lockdown, we've seen how important outside space is, and we have prioritized identifying where we have outdoor space opportunities. Even though we have a well-invested estate, we still have identified 88 investment opportunities within the existing operator-managed estate. We're excited about this as they present real growth opportunities. As we grow, it was important to make sure we have an electronic point-of-sale system that could grow with us. Following a rigorous tender process, we have partnered with an industry-leading EPOS provider to roll out a newer EPOS solution to all of our operator-managed estate. This system will support the growth of the operator-managed estate by enabling real-time data and reporting in important areas such as sales, stock control and cash management. The EPOS system also allows us to take advantage of new technology as it's released. We are currently installing our new EPOS systems into our pubs, and we aim to have this completed by April '21. Now moving on to growth. Getting products and pricing right is absolutely vital in a wet-led drink portfolio. Integrating the recent Bravo acquisition has presented us with an opportunity to review our products and pricing. We're in the final stages of this review, and it should go early, and it should go live early next year. Once it's live, it should unlock some additional income. We are currently converting pubs from our L&T estate into our operator-managed estate. And alongside this, as part of the final destination exercise, myself and Andy are working closely together to identify further operator-managed pubs within the current L&T estate. We are particularly keen to grow the operator-managed estate in the Northwest, Scotland and the Northeast. We are ready to grow. We have the team, we have the infrastructure, and we definitely have the appetite. Given the solid foundation, we are already enabled to accommodate future conversions and future acquisitions. I will now run through a couple of operator-managed investments. We will start with The Church Inn in Swinton, which is run by the highly energetic and experienced duo, Steph and Mike. We are particularly proud of The Church Inn for a couple of reasons. One, we've been able to give a new lease of life to a community pub that has been closed over a couple of years; and two, it is a great example of getting great returns on our investments. The Church Inn has delivered an ROI of 74%. And as you can see from the financials, since completing the investment, we have been able to generate a fantastic EBITDA. And equally as important, we are confident that this investment has set the pub up to deliver a strong ongoing EBITDA. Another point worth mentioning is we've been quick to act on customer demand and revisited the pub to invest in an outside area, which will increase the capacity of the pub even further. The second investment I would like to share with you is The Queens Park Cafe in Glasgow. The Queens Park Cafe is run by Annie, who is a Glasgow legend, and this is a pub that is a great example of a targeted investment. We already had a great quality pub but have been able to make it even better. Again, we converted the pub to operator-managed, but this time with a modest spend. And as you can see, we improved the EBITDA by GBP 57,000. This can be attributed to investing in the right areas, having greater control over day-to-day operational matters, such as retail standards, marketing and products and pricing. Another important benefit of the operator-managed model is that the number of pubs per BDM is low. This enables a higher frequency of BDM visit, which in turn means the operators are given moral support and guidance. By investing in the right areas and converting this pub into operator-managed, we have also increased the book value from GBP 493,000 to GBP 750,000. And like we did at The Church Inn, we've been able to create an outside space for our customers by securing the pavement license for the outside area at the front of the pub. We've already seen a benefit from doing this. As you can see on this slide, we have managed to recover quickly. Since reopening on the 4th of July, we have managed to deliver an 83% cumulative like-for-like performance and have only dropped below 80% like-for-like in 1 week. The week where we dropped below 80% was where the government introduced some additional restrictions at short notice. These restrictions did affect sales, but we have acted quickly to overcome this challenge, and I'm pleased to say that we're already seeing the positive effect of these actions. We believe that we were able to recover quickly due to ensuring that our pubs are set up to provide a COVID-secure environment and that our BDMs and operators had industry-leading support and guidance. The government's recent Eat Out to Help Out Scheme did attract some of our customers away from our wet-led pubs and into restaurants and pubs that serve food. Although this was a short-term boost for pubs that serve food, it has meant that many are now having to continue with their own heavily discounted offers, which are funded by themselves. This will no doubt be having a big impact on their profitability. As you can see, our sales have been consistent since we've reopened, and we've achieved this without requiring any promotions to stimulate sales. It is fair to say that we have had to overcome and adapt many challenges in recent months. And we have only achieved this in many different ways. Not only have we been focusing on sales, we have been negotiating better deals and mitigating costs wherever possible. We've been able to achieve this because we have control over the operating costs in operator-managed and also our best-in-class commercial team have been able to secure great deals. My final point I would like to make today, which is an important one, is that because we are able to control the cost, the way we can in operator-managed, this has meant that we are still able to deliver impressive profitability. If I consolidate the total performance in July, August and September, we were only 2% down like-for-like and if I take the current trend using just August and September's performance, then we are an impressive 19% up like-for-like. I'm sure you will agree that this shows the operator-managed model is not only profitable but also, when required, very resilient. I hope you've enjoyed what you've heard today, and thank you for listening. I would be delighted to take any questions you may have through the webcast facility. I am now going to hand over to our CEO, Mark Davies, who is going to provide an overview of our recent Bravo acquisition.

Thank you, Mark, and thank you, Andy, as well from The Eagle and Child. It's a very comprehensive update, very much appreciated. Earlier in the presentation, Slide 6 ran through our track record on acquisitions, how we built this business and how we've created a market-leading community pub company. We're highlighting the Bravo acquisition this afternoon for a number of reasons. Firstly, it's our most recent acquisition. But I just wanted to set out, just briefly, the reasons why we undertook this transaction. We were clearly attracted to the initial yield. Acquisition price yield at 14%, which is definitely sustainable. In fact, we think we can grow the income from here in a normalized environment. Now the quality of the estate is very good, very well managed, very well invested by Bravo prior to our acquisition. But the other key reason was strategic, Mark has talked to us this afternoon about the operator-managed business, what that means and how we make money. Bravo Inns is a portfolio of 44 wet-led community pubs, all operator-managed. So it was a real opportunity and quite a unique one actually for us to be able to develop scale in the operator-managed segment, which we think will deliver superior returns going forward. The fourth reason, and I've already mentioned this, and I'm not glad to repeat is outdoor space. We could see that Bravo was absolutely ahead of the market on investing into outdoor space. And clearly, that has benefited us to have that expertise within the business coming into a COVID lockdown period. All of our acquisitions have delivered for us, and Matt highlighted earlier the strong IRRs that we've delivered to date. And one of the key ingredients to our success has been our disciplined approach to stock selection, our ability to acquire quality assets at a sustainable and often higher income yield. Marston's here got us off to a great start, and we've done several highly accretive, complementary acquisitions since at purchase yields while in excess of 10%. One of the other sort of clear defining factors of acquisitions for us is the ability to deliver synergies and scale benefits, which will be coming through absolutely in due course. And I think Matt made good reference to that earlier on in his presentation. So we're well placed to benefit, as I mentioned, from the expertise in outdoor space, which we will, I believe, will generate higher returns and higher returns on investment. Ken Buckley, who's Chairman of Bravo, joined the Board of Hawthorn as a Nonexecutive Director, and the company benefits highly from Ken's wise counsel and more than 40 years in the U.K. pub industry. So myself and my ExCo colleagues are delighted that Ken stayed on after the integration on the Hawthorn Board. Now to help demonstrate the market-leading expertise in outdoor space development in the Bravo portfolio. There's probably no better example than The Eagle and Child, where Mark and Andy, coincidentally, are this afternoon. We have a great operator in place here. Derek and Joe, absolutely fantastic couple doing a brilliant job for us. Totally committed to this pub, heavily invested personally, emotionally and financially. And they're doing an amazing job. We're doing weekly sales of over GBP 10,000 a week, and that is set to grow, certainly when we are operating in a normalized environment. EBITDA now in excess of GBP 100,000. And as you can see from the slide, the original purchase price on this was GBP 200,000. So the returns are extremely strong. It's all about people, getting the proposition right, sorting the property, which in this case was outdoor space. It's a shame actually, but we can't see all of the outdoor space on the screen because it's quite comprehensive. In fact, it's pretty amazing. And it's a great case study of what we can do and roll out across this portfolio in the future. The second Bravo pub that I've picked is just up the road actually from The Eagle and Child, it's The Boars Head in Saint Helens. It's a classic wet-led community pub surrounded by housing, new housing developments going in, in the area, new population for more people. Prior to our acquisition, Bravo invested about GBP 200,000 into the pub, done a very good job on the interior proposition and layout. And the EBITDA is good. It's GBP 83,000, but it could be better and it will be better. The pub is a large car park, an unused land. So if you look at the red line land registry title report, you can see that's a big piece of land all around the pub, some of which we will keep for an outdoor space beer garden and extend the trading capacity. But before we do that, we will get planning for houses on surplus land and a giant car park that's just not required. And then we will release some of that capital gain and that profit proceeds into the outdoor space, just like we have done in The Eagle and Child that we just covered. And we'll get that done prior to next year because we've got the Euro Championships, the Olympics, the British & Irish Lions, a whole range of sporting events next summer that this pub will really thrive from when we get that outdoor space investment done. The third and final Bravo pub I just wanted to touch on, the theme is the same. The numbers are extremely compelling. The Black Horse in Warrington, I was there with the team only a few weeks ago on a Friday afternoon, incredible job, again, on the outdoor space. Chris, the partner there as operator is excellent, doing a really good job. Look at the purchase price, GBP 125,000, and this is a pub that's now generating an EBITDA of GBP 100 -- or GBP 15,000 a week of average sales. That can grow off that level. The beer garden looks fantastic. The covered areas are brilliant. You can see sports screens in the covered areas. The heat and light enables us to trade from this pub in outdoor space almost 12 months of the year. So a really great, I think, case study that we wanted to show to you this afternoon because we really believe in this outdoor space theme, we think it's here to stay and COVID has accelerated that without a shadow of doubt. So that's Bravo Inns, a very comprehensive update from our operations directors dialing in from Eagle and Child. So thanks for doing that, guys. But I think it's probably a good time to just pause, stop and address any questions that the people have. Just to remind everybody that there's the ability to ask your questions, anonymous or otherwise through the webcast text box system. So feel free to fire the questions at us, and we'll do our very best to address them before the end of the afternoon.

[Operator Instructions] We do have a question coming through from the line of Tom Musson calling from Liberum.

Just a question on the difference between the 2 models. I get why an operator-managed model is sort of better financially at the EBITDA level for Hawthorn, but just so it's clear. Could you maybe explain why a pub partner sort of would be happy to change from the leased and tenanted model to the operator-managed model? Or is it a case that the model sort of switches only on the vacation of the pub by sort of surrenders of leases and such?

Thanks, Tom. Thanks for asking that question. I think it's a very appropriate question, given the presentation we've just had. Andy and Mark, would you mind just addressing that question from The Eagle and Child?

Yes. No problem at all. So a really good question. And the ultimate operating model depends on not just the partner and the profitability, but it depends on the type of pub and the location as well. Our leased and tenanted pubs tend to be less price-sensitive and more tertiary or even stand-alone community locations versus our operator-managed pubs, which are normally a lot more price sensitive. And in the leased and tenanted world, to get down to the prices you need to be able to charge, stay competitive, you end up giving a large chunk of margin away, which then becomes difficult to ensure that it's passed on to the customers. So by using the operator-managed model, where we need to start to get below circa GBP 2.50 a pint, set up in the northwest today. We have quite regularly trade at below GBP 2 or GBP 2.20 a pint in some of our more competitive areas, and that doesn't work for us in a leased and tenanted world. What it does do in operator-managed is give you complete control. You think that's fair to say, Mark?

Yes, I'd say. And if I just add on to what Andy said there, I think that as the price of the pint gets more competitive, you have to have more controls in place and I think where the operator-managed model kicks in brilliantly because actually, we give them that support. We give them guidance, there's a little more support that we give overall. But ultimately, from a pricing point of view, that's very important. And the other thing that is important to mention is that a lot of the operator-managed pubs, we do provide a bit more security than leased and tenanted in regards to security of tenure and sales opportunities, et cetera. So some people do want that comfort. They're good, hard-working people that have got skills that they want to show, and we feel that the operator-managed platform is a great way for them to do that.

Thanks, guys. I'll probably add -- thanks. Great, Tom. If I could just add to that because I think all of that is extremely compelling. But I think from where I sit, when we look at these decisions to take a pub from leased and tenanted to operator-managed, I think the first thing we'd we probably identify is the pub that has got more potential. So when we were looking at the pubs in my part of the presentation, the Eagle and Child, Black Horse, Boars Head and others. Those pubs have got a leased and tenanted history typically. And we feel with more control, better transparency because we see all the sales data every 15 minutes of every day of every week, we can be fleet of foot. We can invest and see that return on investment coming through often immediately. We can get higher returns and obviously, higher EBITDA. The other thing, which I think is worth pointing out, is that the guys have talked about the ability to control price, which is important in any market. Proposition, which is key often to the success of a community pub. The other thing is scale and approach to the brand owners. So when we're negotiating with the brand owners, whether that's Heineken, Carlsberg, Marston's, a whole range of brand owners that we have strong relationships with, our ability to control price proposition and product is extremely compelling when we're entering into those negotiations. And that, we feel, puts us at a competitive advantage. Now that we have an operator-managed business, that's probably top 3 in the market and growing fast. So it's definitely a part of the business that we want to remain very focused on, in due course, no doubt, invest capital into, generate higher EBITDAs and, importantly, get high returns. Thank you, Tom. Any more questions?

There are no further questions in the queue.

Thank you. I'm just reacting to some questions that have come in from the web. So just forgive me while I just dial this up on the iPad. It's coming from [ Tim Nemis ]. Thanks for these questions, Tim. I think you've got 3 here I can see in front of me. Could you give some data for the leased and tenanted estate agreement type? How many tenants will -- and has this changed over 2020? There's quite a bit of information on that in the pack, actually, Tim, in the appendix, particularly around agreements and how we make money. If there's a specific data that you would like us to address, then we can do that. I'll come back to that in a moment. You were asking about how tenants feel about the furlough scheme and what will happen when business rates resume? Of course, for the majority of our tenants, they're self-employed. They operate sole traders, partnerships, small limited companies. They don't employ lots and lots of people. So the furlough scheme was neither hugely beneficial or, in fact, a huge loss as that has been taken away. Business rates, however, which is the second part of your question is, as I mentioned earlier, far more meaningful. And we, with Emma and everybody at the BPPA will be lobbying very, very hard to ensure the business rates relief is continued beyond the spring of next year. This government knows the importance of this industry, particularly in communities around the country, and we will keep getting across the message that business rates of [ penal ] often across the U.K. and the government needs to find other ways of generating taxation, particularly taxing the digital economy. Their words, not mine. And I think we need to find ways of doing it. Your final question, Tim, is what is the market for acquisitions like at the moment? Do you see many packages coming to the market soon? I think in terms of acquisitions at the moment, I'm not aware of anything that's happened in the market or off-market since lockdown in March. I'm sure there will be opportunities. We have a credible track record. We've demonstrated today the financial strength of the business. I'm sure at the appropriate time that we will get approached, and there will be portfolio opportunities that may well be of interest. We like our model because it's scalable, particularly when it comes to acquisitions. So naturally, when opportunities come along, then we will look at those opportunities should they be presented to us, but nothing that I'm aware of and probably even if I aware of something, I probably wouldn't be able to talk about it, which I'm sure you'll forgive me for. Did anybody else want to address some leased and tenanted questions agreement types? Andy or Mark, did you want to make any reference to the question about lease and tenanted estate because I'm mindful of time.

I think it would just be worth to state, Mark, that throughout our history Hawthorn, we work very differently just to some of the other larger pub cos as they were with a very much [ collaborative ] approach with our partners, where we make sure that the deal works for both people before we actually sign them up on to long-term deals to make sure that we can work in partnership. We have got the relationship, which is so strong and so important to us as a business. And that then gives us the confidence, on both sides, to enter into those long-term commitments. As I said earlier, 89% of the people who were in situ at the start of lockdown are still there, which is a remarkable statistic. And actually, during the last 3 weeks, we've had 4 new long-term agreements signed, which again goes to show the confidence of people working with Hawthorn to navigate, both the current crisis and beyond by signing 5-year tenancies. So the number of overall mix is not something we massively focused on because it's about getting the right people on the right terms, in the right book, and that's how we've traded successfully in the last 6 years.

Thanks, Andy. And thanks, Tim, for your question -- questions, rather. If there are no further questions coming down the line, we will move on. So the next section, which will be led by Ed Little, our Property Director, is titled how we create value from our portfolio. So on that note, I will -- I'll pass you on to Ed. Thank you.

Thank you, Mark. Good afternoon, everyone. I hope you're enjoying the presentation, finding it informative. My name is Ed Little, and I have the privilege of being Property Director for the Hawthorn Group. Today, I'm going to talk to you about the several ways in which we are looking to add value to the portfolio. The first being our CapEx, organic CapEx investment program. Working alongside our operations colleagues, we identify opportunities to invest in the pubs and get behind our quality pub partners and operators to help them drive profitability and enhancing our pubs, both through proposition and condition. Over the last 2 years, we've invested over GBP 13 million into the estate. And then fundamentally, we've improved asset condition across the board. Two recent examples of this are highlighted. First is The Crown of Stadhampton. Now this is a cracking little pub, leased and tenanted down in an affluent suburb of Oxford. We sold a small parcel of land off here to a local residential developer, which facilitated us improving the pub and investing back into the community. The project heavily focused on improving the internal and external appearance of the site and allowed us to attract a better partner on a higher rent and has helped drive wet-led volumes. The investment has delivered a 38% return. The next example is The White Swan. This is a typical operator-managed location within the prominent area in Huddersfield. The investment here enabled us to move the site onto the operator-managed platform with significant investment into our tools, IT infrastructure, sports viewing package as well as a full interior and exterior refurbishment program. The site has delivered us a 58% return on investment to date, which we're very proud of. As we move forward, post lockdown, the investment in internal space has never been so important as the whole team has already alluded to. Smaller investments in garden spaces can have a huge impact on adding an extra dimension to the community pub. To mitigate the impact of social distancing has had on the capacity in our pubs, the implementation of external investments and making them year-round spaces is a prime focus of our group. As we look forward to invest CapEx in the future, this is a considerable area of improvement. To accelerate this program, we have already engaged designers and suppliers who are offering innovative, energy-efficient heat and light solutions that create warm, welcoming spaces well into the winter months. Other opportunities to add value are varied across the portfolio, both in their diversity and geographical location. We've had significant success in realizing value through residential developments and our c-store developed -- delivery program. However, during the last 12 months, further uses have come to life, especially around assisted living opportunities and roadside developments. As we've continued to grow in size and scale, we've been able to take advantage of these new uses. Our largest success to date has come from our c-store development program, which has seen us deliver over 25 c-stores to the co-op group over the last 3 years. We are currently finishing #26, as you can see from the picture, and this is the former Sea View Inn in Poole. This development includes a C-store and 10 residential apartments, which are under offer to a residential development -- developer in advance of full completion of the project. Upon practical completion of the site, we will trigger a GBP 275,000 performance receipt from the co-op, and our development of the Sea View pub is projected to deliver in excess of GBP 1 million on an original purchase price of GBP 300,000, a significant return. We're continuously looking through the portfolio for other opportunities where we can add significant value. Similar to the Sea View on the previous slide, The White Elephant, as pictured here, has been identified as a potential c-store with the possibility of residential above, anticipated to be in a scale of around about 30 units. The White Elephant was part of the original Hawthorn estate acquired back in 2014, and the site is located within an affluent commuter suburb of Glasgow, which hasn't seen enhanced residential value properties in recent years. Whilst the site has traded well for us, the delivery of this project will see the value enhanced to circa GBP 3 million. Moving on to other ways that we can generate value, the Railway Tavern in Chorley is a prime example. This site was acquired from Marston's in 2013 for GBP 284,000. Since then, we have sold a parcel of land for GBP 36,000, as highlighted in point #1. We then secured planning consent to build 9 residential units in the surface car park which was sold to a local developer for GBP 450,000, highlighted in point 2. And finally, the sale of the pub to a private nursery, where the operator has secured planning consent for change of use at a sale price of GBP 450,000, highlighted in point 3. So that's a total capital profit of over GBP 600,000 on an investment of GBP 284,000. This is a great example of how we can create value and show the range of uses that can be implemented. We remain excellent at extracting value in our pub estate through risk-controlled development of residential uses. A good example of this is The Wheatsheaf pub in Hatfield Peverel, which is in Essex. The pub was part of the original Hawthorn portfolio. And as you can see from the picture, benefited from a large amount of land. Following the successful change of partner at the pub, we were able to facilitate a surrender of the land, previously used as a campsite. We then sold this land for an excess of GBP 350,000 to a local housing developer after they secured planning commission for the construction of 9 new homes. We finished this off with a refurbishment of the pub, which continues to be a local community hub and retains ample garden and parking space. Another example is the Horse & Harrow, where we can leave our successful relationships with our pub partners. The pub is based in a rural setting on the south of Oxfordshire. The site had a disused 9-hole mini golf course to the rear of the pub, which would have been allowed to fall into disrepair. We reached an agreement with the partners to surrender this land to ourselves, and this allowed us to secure planning consent for 3 detached houses and sell this land for GBP 357,000. The pub is retained and has got a good-sized garden car park, and the partner enjoyed a small cash windfall as well as external and internal redecorations that were undertaken by ourselves. One of our newest ways of adding value that we are working on is demand for assisted living. Social housing and assisted living is a major growth area due to the government's need to build over 300,000 dwellings by 2025. Both social housing and assisted living sit well alongside community pubs and in suburban locations. One of our more recent acquisitions, The Old Springs in Orrell to the west of Wigan. This area in Wigan has a shortage of social dwellings. Our site benefits from an oversized garden and working with a local social housing operator, plans for 26 dwellings have been drawn up. The ambition is to achieve receipts of GBP 280,000 and bring to life a needed facility for the community. Finally, the Dow's Bar in Inverness is another prime example of levering successful relationships with our pub partners. As you can see, Dow's Bar has a very large site located to the southeast region of the city. The site has been underutilized by the partner, and we are engaged with other occupiers about a possible assignment. The site was too big for Domino's, so a subdivision was agreed and implemented in 2017. A 10-year lease was granted to Domino's at GBP 30,000 per annum, and the site is being marketed at GBP 400,000, reflecting a yield of 7.5%. This subletting has left a more sustainable pub for our pub partner and generates an EBITDA in excess of GBP 80,000 per annum. This is driving a book value in excess of GBP 600,000. Thank you for your time. I'll now hand over to Edith, who will talk to you about placing people at the heart of our strategy. I'm happy to take your questions through the webcast facility after Edith's update. Thanks very much.

Thanks, Ed. Good afternoon. I'm Edith Monfries, Group Head of HR and COO of Hawthorn Leisure, a role I took on to facilitate the integration of NewRiver and Hawthorn following our acquisition in May 2018. My key objective was to ensure we created a best-in-class team with a clear vision of our strategy, with the strength and depth to implement that strategy. My goal is that Hawthorn is the best pub company to work for and with. As Mark Davies highlighted in his presentation, the strength of our platform is based on the first-class team we have assembled. We have done this by internal promotion and development, rigorous performance management and judicious external recruitment. We believe in empowering our people. We have a strong ExCo, all of whom are presenting to you here today, and all of them bring wide-ranging and complementary experience to the ExCo table. The pub business is a granular operational business. So to support ExCo, we have a further 10 directors and managers on the senior leadership team, representing all business areas. Our organizational structure is robust and scalable. And we have the leadership team in place to enable us to scale the business. Our head office location in Birmingham is ideally placed in the heart of our pub estate with access to a wealth of talent. Our total headcount is currently 92, split 46% female and 54% male, with strong representation of women throughout the business from Board level and across all our teams. We have invested in training and development, our online training platform, which Mark mentioned before, has facilitated the creation of personal development plans for all our people. It provides training tools, not only for our staff, but also for our pub partners and operators. We support staff undertaking professional qualifications. This ensures that we continue to develop our best-in-class team, who have the tools to upscale and ensure that they are fully conversant with the regulatory requirements of our industry. We place people at the heart of our business. Our strong people culture is built through the values that you see on the screen in front of you. We put people in the right roles and develop their careers to ensure they grow with the business. A positive work environment where employees feel valued and supported underpins our strategy. We undertake regular staff engagement surveys with response rates of over 95% and approval ratings of over 90% across all categories. In my 30 years in HR, this is some of the highest scores I have ever seen. It is, however, not what we think, but what our people think that counts, and they say, Hawthorn is a truly inspirational place to work. The team is a cohesive unit led by highly professional managers. We believe in recognition and reward. We encourage staff to recognize colleagues, and these nominations are then shared with a wider team. It celebrates those that go the extra mile and creates a healthy sense of competition and drive to do more than your best, creating a competitive advantage through our people. Our bonus plans are open to all staff, subject to both corporate and personal performance, and are target and objective-based and monitored through our ongoing appraisal process. Our bonus plan include deferred share-based awards and LTIPs, which ensures our people are invested in the future growth and success of the business. We foster an environment which is collaborative and supported, focused and flexible with a team of people who are hard-working, adaptable, passionate and resilient. This was epitomized by the team's response to the news of lockdown announced by the Prime Minister on Friday, the 20th of March at 5:00 p.m. By pub closing time, the team had called every pub in our estate. That's over 700 pubs. The weekend the pubs reopened on the 4th of July, the teams visited over 140 of them. All partners and operators were supported by the operational team, as Mark and Andy mentioned in their presentations. And they were contacted via regular calls and visits when restrictions allowed. It is this that led to 97% of our partners and operators feeling supported. Our BDMs, business development managers, have had some great feedback, and I quote, "Your information was helpful and concise. You gave me faith that this can be won together." And another "Hawthorn Leisure have been an example to others. Through working in partnership, we have been able to continue to trade, and we have saved the jobs and income of our staff, many of whom are reliant on their pub wages to feed their families." These are heartwarming comments, but they also drive business success and underpin the power of being at the heart of the communities we serve. Our focus is to protect our people. They are at the heart of what we do and the health and well-being of our people is a key priority. Responses in our staff engagement survey include, "The support and events we have and are encouraged to have are fantastic. The company backing this is brilliant." The period of lockdown is a demonstration of our commitment in this area. Notwithstanding that our pubs were closed and 79% of our staff were furloughed, we continued to maintain regular contact with each and every one of them. We held weekly staff meetings, huddles, where we kept the whole team in touch with all we were doing as a senior leadership team to support our pub partners and operators and provided reassurance around the future of our business. We provided wellness packs for both our staff and our partners and operators, which underpinned our wider support packages. All staff remained on full pay throughout. We did not forget the wider community raising funds and enabling volunteering for our charity partner, the Trussell Trust. This complemented a large number of initiatives across our pub estate, where individual partners and operators supported their local communities. I believe that it is the hard work in this area, which has strongly reinforced our community message and supported morale across all our teams. It is enabling us to continue to bounce back from the challenges of the COVID pandemic and contributing to our continuing outperformance. We have our best-in-class operating platform through the strength and depth of our team, its experience and its expertise. Our infrastructure is scalable and our people-focused strategy makes us the employer of choice in our sector, as Mark Brooke highlighted in the introduction to his presentation as to why he joined Hawthorn. There's a wealth of talent available in this sector, and we are well placed to attract and retain that talent. All our people, hub partners and operators have a passion and commitment to emerge stronger and work with us to build the #1 community pub company in the U.K. Thank you for listening to my presentation. And I would now like to open the floor to questions, which you can submit to the webcast browser or on the phone lines. Thank you. Mark, do you want to?

Thank you, Edith. Good time to pause for questions.

We've currently no questions in the queue. [Operator Instructions]

There's a few questions coming through. So I'll just read those out, and we'll address them as a team as we go through. There's a question from [ John Naylor ]. Apologies if this has been covered earlier, but is it possible to have a comment on the return of dividends? Have you received any guidance from the HMRC about REIT requirements being relaxed in the current environment? I'll address that question, John, if that's okay. We haven't actually covered dividends, but we have made commentary recently on dividend, and it's the company's strong intention -- and we're very clear about this, is to reinstate our dividend at the earliest possible opportunity. As I mentioned previously, John, we've got results coming out in a few weeks. That is a logical opportunity for myself, Allan and the team to address that specific issue. We'll be discussing that with our Board, obviously, and our Audit Committee in advance of our results release and we will provide that guidance at that time. But what I can say to you is the Board, of which I'm on, is totally committed to reinstating that dividend as soon as possible. In terms of the technical point you make in the second part of your question around HMRC and REIT requirements, we've not received any guidance from HMRC on this. We're not familiar with any intention to relax requirements. We, as a REIT, have been qualifying since we became a REIT 10 years ago, and that's not going to change. So at the appropriate stage and at the earliest possible opportunity, we'll be reinstating our dividends and will remain REIT compliant. We're very, very committed to that. So thanks for asking that question. The next question is coming in from [ Greg Johnson ], again, at Shore Capital. Thanks, Greg. You've been very active and interactive this afternoon. We appreciate that. With working from home said to be a long-term structural change, have you reappraised the potential number of c-stores that could be developed across the enlarged Hawthorn estate? Absolutely. We're really aligned to this. One of the clear emerging themes from lockdown has been the resurgence of demand for convenience retail. I know Greg and Clive and the team at Shore, you talk regularly to the grocers and the market-leading convenience store operators, particularly the co-op, and you will know as I do, they are actively looking for new opportunities. And myself, Ed and the team at Hawthorn are very aligned there and looking for ways to, not just reappraise those opportunities, but to obviously create value. We've got an amazing track record at developing C-stores on a surplus space across the estate around the country. There's more to go after and in many ways, the market is going our way in that regard because people are shopping local, they're staying local, they're socializing local. And that is set to remain, even when we come through the other side of this. Of course, there's a theme around localization that our pub portfolio will clearly benefit from as well our retail portfolio actually. So thank you for asking that question. There's more questions coming in. I'm mindful of time, let me just deal with one just now. And if we have time, we'll come back. This is from, again, from M&G. Have you experienced pub tenants acting in bad faith and not paying the rents? How do you deal with these situations? Good question. When you've got over 700 pubs, it would be wrong for me to say they don't get the odds for poor behavior. But as I'm sure you've seen this afternoon, we've got a very hands-on, focused team and those 4 behaviors are dismissed quickly and dealt with. So I wouldn't be able to talk to you of any live examples because those examples have been dealt with. But we did, of course, manage to collect around 40% of rent due in lockdown. Bear in mind, the pubs were closed, weren't generating any sales. We demanded rent. We were very, very strategic and sensible about how we went about that. As we were coming out of lockdown, support grants were coming in. We started to request payment or part rent. And we got to 40%, which is a very compelling result. And yes, we'll continue to improve on that, of course, but there's also an insurance matter that we're dealing with, which in due course can certainly fill the gap. So thanks for raising that question and allowing me to address it. I'm going to move on to my closing remarks, if that's okay, and conclusion. I'll just check before I do that, any questions coming through the line? No questions on the line. Great. Just moving on to the final couple of slides, bang on time. So I'll take a bit of time just running through this. First of all, starting a chance to do this. Thank you, Edith and Ed, for your presentations. I'm sure you all agree from the presentation today, we've got a really great team at Hawthorn. The goodwill and the team spirit within the team is very, very strong. I hope that comes across. I can feel it in the room. I see it every day. It's a solid foundation to build this business going forward. So I'm very, very proud of that. My final remarks on today's presentation are economically, socially and politically, the U.K. beer and pub sector is important to the U.K., it is important to our economy and to our government. And I thought this came across really, really well, very strongly, very compelling in Emma's presentation. In Matt's presentation, we saw firsthand what a strong financial position we are in as a company today. We've got a strong track record of earnings growth, the ability to integrate accretive acquisitions, deliver scale benefits and synergies. The trading update from Andy Parker and Mark Brooke was extremely comprehensive and detailed. I think it's exactly what we wanted. And the trading performance, of course, has been highly commendable, very strong, very sustainable. And we've outperformed the market since the 4th of July. And we think that will continue and might continue. Ed's property update gave an overview of how we create value in our portfolio on typically surplus land, c-store developments, residential and other uses. I think that's really quite exciting, opportunities there to go after for Ed and the team in the future, and I'm absolutely confident they will deliver the track record that's been presented this afternoon. There's more to do. And finally, Edith gave us a great people update, and we've got a highly experienced team. And as Edith said in her words, a best-in-class operating platform. So to conclude. Investment into community pubs has delivered very strong returns for us. It was a good investment when we went into our first transaction 7 years ago. Our business is scalable, and there are plenty of synergies to go after. Our assets are high quality, and there is potential to create further value. And there is huge potential to grow earnings, both organically and through further acquisitions. And on that note, I'd like to thank you all for your time this afternoon, listening to our presentation, your interaction through the thoughtful and considerate questions that you've raised. And because we've got a few minutes to spare. We've probably got one final opportunity to address any further questions to myself and the team.

[Operator Instructions]

Brilliant. Well, that sounds like we covered all the bases. And as I said just now, thank you all very much for your time this afternoon. I hope you enjoyed the presentation and enjoy the rest of your day, and have a good evening. Thank you.