Marston’s boss remains upbeat despite revealing more pub sell-offs
Pubs and restaurants group Marston’s is to sell off more pubs to reduce its debts.
Chief executive Andrew Andrea said more than 60 pubs across the country were likely to be sold.
They are on top of the 61 pubs already being sold off by the Wolverhampton-based group that were revealed in March. Those include the unique Crooked House pub between Dudley and Himley and the Bradford Arms at Knockin.
The aim for the sum to be raised from sell-offs has been raised from £15m-20m to £55m- £65m.
In its latest half year results Marston’s revealed revenue has risen compared to the same time last year, with bosses saying “consumers remain as keen as ever to socialise within the Great British pub”.
The group, which currently operates 1,440 pubs and employs 11,000, saw revenue climb to £407 million from £369.7m in the same period last year as it revealed its interim results for the 26 weeks ending April 1. The results meant, on an underlying basis, the firm’s pre-tax loss narrowed to £3.6m from £7.5m last year.
Marston’s said drink sales continue to perform well and food sales were encouraging, demonstrating the trading resilience of the predominantly community pub estate.
Mr Andrea said it was important to continuously review its pubs. Those that are to close in the new announcement have not yet been revealed, but those already earmarked to be sold also include The Spills Meadow in Kent Street, Upper Gornal, The Fountain Inn, Clent and The Garibaldi in Stourbridge, as well as the Blue Pig in Trench and the Red Lion, Madeley.
He said: “The strategy which we outlined 18 months ago is progressing well and generating positive results which is pleasing.
“Consumers remain as keen as ever to celebrate and socialise within the pub.
“The macro environment is becoming increasingly stable and recent evidence suggests that both the cost outlook, and consumer confidence, are steadily improving. The actions we are taking are building a demonstrably better business and Marston’s predominantly community pub estate continues to benefit from changing consumer lifestyles.”
“We continue to deliver upon our clear strategic objective to reduce debt and progress our path to profitability.
“We remain on track to meet our operating profit, cash generation and debt reduction targets for the year.
“We look forward to delivering further positive progress as the year unfolds and remain confident that we have the strategy and the team in place to do so, maximising the opportunities open to us in the future and delivering shareholder value.”
Mr Andrea said that Marston’s was on track with its Back to a Billion strategy, which aims for £1bn annual turnover by 2026. He said two-thirds of operating profit came in the second half of the year with sales helped by better weather.
“We have invested in our pub gardens and that is playing to our benefit,” he added. “In the six weeks since year end sales had been helped by bank holidays.
Although the King’s Coronation Saturday saw slow trade with people staying in, the glorious weather on the Sunday had seen “a cracking day’s trade” for Marston’s. Profits were hit by high energy costs in the first half, but in the second half lower energy use would help.
Mr Andrea said the group had already fixed its energy costs for the first half of 2024-2025.
“Consumer confidence appears to be improving and our pubs are well placed to take advantage of that and we are not facing the same inflationary pressures that we faced last year,” he added.
