Marston’s cheered as sales improve on last year
PUBCO and brewer Marston’s has said it has seen trade across all its divisions show signs of improvement compared with last year.
In a trading update for the year ended October 2, 2010, the Wolverhampton firm said it was in a strong position to meet any challenges that may arise.
It said that in Marston’s Inns and Taverns, its managed pubs division, like-for-like sales were 1.7% ahead of last year, including like-for-like food sales growth of 2.5% and like-for-like wet sales (drinks) growth of 1.4%.
Like-for-like sales for the nine weeks to October 2 were up 1.7% – the success put down in part to food offers, which now accounts for around 40% of all sales. Other growth drivers included the implementation of a new-build strategy.
The firm said operating margins had improved this year largely as a consequence of tight operational cost control, lower utility costs and the disposal of 17 lower margin leasehold sites.
In Marston’s Pub Company, its tenanted and leased pubs division, underlying profit trends have continued to improve with like-for-like profits estimated to be 3.7% below last year. This compares favourably to the 4.5% decline reported in the firm’s interim results in May.
Approximately 86% of the estate is currently let on substantive agreements, including Retail Agreements. The group now has 104 pubs on Retail Agreements, with performance in line with our expectations.
As previously announced, Marston’s said it still expected to introduce a further 500 Retail Agreements over the next three years.
In Marston’s Beer Company, which includes brands such as Pedigree and Hobgoblin, Banks’s, Jennings, Wychwood, Ringwood, Brakspear and Mansfield, the group said it expected that both turnover and operating profit would be slightly ahead of last year against strong comparatives.
“Own-brewed ale volumes were slightly lower than the prior year, but continued to significantly out-perform the UK beer market which declined by around 6%. Premium ale volumes increased by 3% in the period and we continue to lead the market in the premium cask ale and premium bottled ale segments,” it said.
Net debt and cashflow were in line with expectations.
The group said its development plans were on track. It has opened 15 new sites during the year as planned, with both turnover and profit performance in the new openings ahead of targets. It expects to open 20 new pub-restaurants in 2011 and 25 in 2012.
“We have seen improving trends in each division and made good progress in implementing our strategy. Our focus on value for money, high quality pubs, food and local beers places us in a strong position to meet the challenges ahead,” said the update.
Preliminary results will be announced on December 2, 2010.
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