WTA ANNUAL CONFERENCE 2013 Banking…our place in your industry?

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Contents

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Market trends in the UKMarket trends in WalesLeisure Survey Investment and Funding optionsNatWestQ&A

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UK – Leisure Sector in line with UK economy, although more volatile

Source: Datastream RBS Economics

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UK – Strip out accommodation…..story changes

Source: Datastream RBS Economics

UK – Regions broadly in line in tracking UK economy

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Source: National Statistics

Regional gross value added (average y/y growth 1998-2011)

-4%

-2%

0%

2%

4%

6%

8%

10%

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

North East North West Yorkshire and The Humber East Midlands

West Midlands East of England London South East

South West Wales Scotland Northern Ireland

UK

UK

London

UK – Wage costs appear to have eased slightly relative to UK plc

Source: Datastream RBS Economics

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UK – Outlook getting better……slowly

Source: Consensus Economics

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Wales – Sector importance for the Welsh economy

GVA of £2,322m in 2010.

Source: ONS Headline workplace based GVA at current basic prices, Wales (‘Accommodation & Food Services’ and ‘Arts, entertainment and recreation’)

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Wales – Volume and Value of the sector

Source: Nomis / ONS International Passenger Survey, Wales

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9.89m visits in 2010 spending £1.8bn (Domestic and International). Domestic tourism represent 90% of visits & 80% of spending.

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Wales – Sector importance for employment

124,000 people employed. 5.8% of the population.

Source: Nomis / ONS June 2013, Wales (‘Accommodation & food service activities’ and ‘Arts, entertainment & recreation’).

NatWest Leisure Survey – Cautious Optimism!

How optimistic are you about your business over the next 12 months?

How will your business perform over the next 12 months?

Source: RBS Insight Survey of Leisure Customers April 2013

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NatWest Leisure Survey – Attitudes to investment

Have you invested enough to stay competitive?

Do you think it is too risky to invest in the current climate?

Source: RBS Insight Survey of Leisure Customers April 2013

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NatWest Leisure Survey – What businesses want to invest in

Source: RBS Insight Survey of Leisure Customers April 2013

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What Type of investment would make the biggest positive impact on your business?

NatWest Leisure Survey – Summary of key messages

Source: RBS Insight Survey of Leisure Customers April 2013

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Cautious Optimism Cautious Optimism

Access to FundingAccess to Funding

Lacking InvestmentLacking Investment

Please Don’t RainPlease Don’t Rain

Lick of Paint RequiredLick of Paint Required

August and December CriticalAugust and December Critical

Security may be required. Product fees may apply. Over 18s only.

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME,MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR

OTHER DEBT SECURED ON IT.

Investment – Funding options

Equity Owner Equity Private Investors (EIS/SEIS Schemes) Private Equity Business Growth Fund Crowd Sourcing?

Debt Bank Debt Private Loans Brewery Loans / Key Money

Mezzanine Hybrid

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Security may be required. Product fees may apply. Over 18s only.

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME,MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR

OTHER DEBT SECURED ON IT.

Investment – Optimal Capital Structures

Optimal balance between debt and equity Equity more expensive Debt cheaper

Ultimate combination will drive cost of capital for investment

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Security may be required. Product fees may apply. Over 18s only.

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME,MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR

OTHER DEBT SECURED ON IT.

Investment – What are banks looking for?

Viability

Proof of concept Strategic rationale Location/s Management capability (both operational and strategic) Budgets / margin / cash management Single site versus multi site Freehold versus leasehold

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NatWest - What are we doing?

Sector based approach Training and accreditation Working with you 4 Specialist RMs in Wales

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NatWest – Ahead for Business

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NatWest - Leisure Fund

Security may be required. Product fees may apply. Over 18s only.

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME,MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR

OTHER DEBT SECURED ON IT.

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What is the Leisure Fund?

Fee-free borrowing to help you business grow.

£300m Fund to support the UK Leisure Sector.

Optional capital repayment holiday.

The Leisure Fund & Funding for Lending Scheme is a limited Fund and will be offered on a first come first served basis. It is for loans of up to 5 years.Usual lending conditions apply. Structured finance and real estate finance are excluded. Only available to businesses with a turnover of above £2mand a maximum of £25m.The Capital Repayment Holiday is available for loans over £1m. For borrowing below £1m, it is subject to application. Only one six-month holiday canbe taken in a 12-month period. Not available for development funding.

NatWest - Leisure Fund

Security may be required. Product fees may apply. Over 18s only.

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME,MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR

OTHER DEBT SECURED ON IT.

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How much have we lent in Leisure since launch? £162.719m 265 Customers

Source: RBS / NatWest Leisure Fund

Sub-Sector Grand TotalHotels £90.594mOther Leisure £17.917mPubs £17.052mRestaurants £24.025mSporting £8.771mTravel £0.910mGaming £3.450mGrand Total £162.719m

Questions?

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