Pub owner Redcape turns dividend tap back on for investors

The company’s portfolio of gaming pubs in western Sydney is performing in the face of the virus.

Redcape chief executive Dan Brady Dan Brady.

Pub landlord Redcape Hotel Group has reinstated its distributions after a bumper first quarter of the financial year following lockdowns.

Chief executive Dan Brady said the move reflects the positivity about the company’s outlook and the trajectory of the pandemic.

This was solidified by a year-on-year rise in both operation earnings before interest, taxes, depreciation and amortisation to $24m (up from $19.5m) and distributable earnings of $19.6m from $12.9m in 2020.

The company has offered a distribution of 1.83 cents per stapled security for the first quarter of the current financial year.

“Our ability to deliver a record quarter performance following the reopening of our venues demonstrates the resilience of our underlying property back to business and the investments we have made in our people venues and platform capability,” Mr Brady said.

“Through our portfolio of community-based pubs and heightened engagement with our staff and customers, we’ve quickly adapted to the new environment while still providing hospitality experience customers value.

“Reinstatement of distributions now allows us to resume our strategies that should result in growing earnings and increasing asset values.”

Redcape operates 32 venues across NSW and Queensland, all of which have reopened since the initial shutdown in March. It has no exposure to the current Victorian lockdown phase.

Last financial year, the pub operator posted a full year net profit after tax of $11.2m. Full year operating earnings before interest, taxes, depreciation and amortisation were down 14.8 per cent to $57.1m.