<p><strong>Harcourt Pub Limited &ndash; Shareholder Report</strong><br />
This report covers the period starting 1 October 2018 and ending 30 September 2019.</p>

<p>The year saw a fall in EBITDA due to a turbulent 2019 with a big shakeup in the in-house management team and pub offer. The pub was seen largely as a Scandinavian restaurant with events &amp; private dining rooms and so was reliant on demand from destination diners and private functions which are seeing a downturn as a result of political and economic uncertainty. The management team brought the business more in-line with the Harcourt Inns model with a wet-led bar in front of the property and a dining room to the rear as afterwork wet sales are integral to the success of the business as seen in other group pubs.</p>

<p><br />
Following the recruitment of a new marketing coordinator and head of events the business is now well positioned to begin a marketing and business development drive to grow the business. Marketing and business development are key given the secondary location of the property and so an initiative on driving community engagement to generate footfall is fundamental to the success in terms of a food &amp; beverage business.</p>

<p><br />
<strong>Personnel</strong><br />
The head office team has made two significant hires in the last six months recruiting Jennifer Booth as Project &amp; Marketing Coordinator and Ellie Laidlaw as Group Events Manager. Having carried out the same role at Coppa Club, Jennifer will work closely with group PR &amp; social media consultants, group brand consultant and website designers to oversee group and site level marketing strategy including digital, PR and website design &amp; SEO. Ellie brings a huge amount of experience in the events management and hospitality space having worked as GM at Sonny&rsquo;s in Barnes (a Phil Howard restaurant) and most recently as a partner in Tempus Catering &ndash; an events and catering business.<br />
The UK hospitality sector is experiencing a highly challenging recruitment environment as a direct result of Brexit. In order to overcome this challenge, the group is focusing on staff retention and is working closely with group HR consultants to put in place staff training and development programmes.</p>

<p><br />
<strong>Risks</strong><br />
There are a number of risks that could affect both trading performance and property values. Brexit combined with political uncertainty and global economic headwinds is a real risk to trading performance and having spoken to a number of leisure operators, agent &amp; valuers trading performance and asset prices are being negatively affected. Sansar (Andrew Endean) through their company, Harcourt Management Services Ltd, still charges operator fees to the company, through an operator agreement, without providing any meaningful value and so the directors are in discussions with Sansar to establish a route to terminate. While their contract exists there will be a drag on cash flow and net profit.</p>

<p><br />
<strong>Hotel Room Development</strong><br />
The management team has initiated pre-app discussions with Westminster Council to develop up to nine hotel rooms. Subject to the advice from Westminster a planning application will be submitted with potential consent 3-4 months later.</p>

<p><strong>Exit</strong><br />
With the company outside the three-year EIS holding period the directors are now looking at exit options for shareholders. Informal discussions have been initiated with several advisers including Savills and Coffer Corporate Leisure. Exit options will be circulated in Q1 2020.</p>