Bass Reports Potential Shopping Spree of £4 Billion

December 13, 2000 -- HVS International -- Boosted by the proceeds from selling its brewing division, Bass has reported a sharp rise in its full-year profit, up 277% to £1.99 billion. Excluding the £1.23 billion profit made from the sale of Bass Brewers, performance was strong for its continuing businesses, with a 25% rise in operating profit to £776 million, on turnover up 22.8% at £3.775 million.

Adjusted pre-tax profit before exceptional items increased 18.9% at £756 million, which exceeded analysts' expectations of between £735 million and £755 million.

According to Tim Clarke, Chief Executive of Bass, exiting brewing has left the group in a very powerful position. The priority now is to develop the high growth global hotels and the high return branded pubs and restaurant businesses.

Bass has revealed that it has funds of 4 billion available to spend on acquisitions, but refused to comment on its preferences. A further £940 million has been earmarked for a capital expenditure programme planned for 2001, of which £600 million will be spent on hotels.

The strategic review of the group continues. Bass Leisure Retail is experiencing tough market conditions, with the unbranded small pubs remaining a weakness and increasing pressure to dispose of the company's pub assets.

Nevertheless the return on assets is questionable at a time when both Scottish & Newcastle and Whitbread are stripping down their pub assets.

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