Marston's hopes for World Cup revival as Beast from the East hits sales
Pubs and breweries group Marston's saw sales knocked by the Beast from the East in its latest half year, but is hoping that rising wages and the World Cup will boost figures in the coming months.
Its so-called destination and premium pubs saw sales fall 1.8 per cent in the six months to the end of March but sales at its taverns rose 2.9 per cent and like-for-like sales were flat across managed and franchised bars.
Marston's, which owns the Two For One and Pitcher & Piano chains, said its drive-to pubs suffered in particular from the freezing weather as customers stayed at home.
The Wolverhampton-based group expects to deliver growth in revenues and underlying profits over the full year.
It made a pre-tax loss of £13.4 million for the half year against profits of £36.7m a year earlier after booking writedowns from property estate revaluation.
Overall revenue was up from £451.5m to £529m and underlying pre-tax profits were ahead eight per cent to £36.3m helped by growth in taverns, leased and brewing.
Average profit per pub was up one per cent and brewing volume sales rose 74% per cent.
Chief executive Ralph Findlay said: “We are pleased to report another period of good growth in revenue and underlying profit before tax.
"Strong trading in brewing and taverns and leased pubs offsets the adverse impact of poor weather on ‘drive-to’ pubs in our destination estate, further validating the resilience of our model.
"We have made modest and prudent adjustments to our capital plans to reflect the current economic and consumer climate.
"However, Marston’s is a balanced business and we are confident that the medium-term outlook for the eating-out and wet-led pub sectors remains good and that targeting an increased profitable share of a growing market through an unremitting focus on quality, service, standards and value for money remains key.”
While Marston's will open 15 pubs and bars and six lodges in the current financial year, it is modestly trimming back openings for 2018-2019 to 10 pubs and bars and five lodges – a net capital reduction of £25m.
Mr Findlay said: "Consumer confidence over the last 12 months has been relatively weak. This week's news we appear to have real pay increases above RPI is good for us if that is sustained.
"There is a more optimistic picture for consumer confidence and the World Cup will be a positive for us."
He said that with Marston's having 24 per cent of the premium bottled beers market and 23 per cent of the market for premium cask beers in pubs, the World Cup presented a good opportunity for the group to grow sales.
Marston’s, which employs 14.500, has an estate of 1,564 pubs and its breweries include Banks’s, Jennings, Wychwood, Ringwood and Brakspear
Following the acquisition of the Charles Wells brewery, Marston’s has added Bombardier, Courage and McEwan’s to its brand portfolio, as well as a range of licensed brands including Young’s, Founders and Estrella Damm.