Marston's makes half-year profit
New acquisitions and lower administrative costs helped pubs and breweries group Marston's post a two per cent rise in its half-year underlying pre-tax profit.
The Wolverhampton-based company, which which has pubs across the West Midlands, said the figure increased to £37 million, while revenue rose five per cent to £553.1m for the 26 weeks ended March 30. On a statutory basis Marston's made a £19.1m pre-tax profit from a £13.4m loss for the same period in 2018
The company also said momentum was maintained in the second half of the year on strong Easter sales.
In a statement to the London Stock Exchange, Marston's also confirmed that its destination and premium divisions' like-for-like sales were up 1.2 per cent while taverns rose by 3.9 per cent.
Managed and franchised like-for-like sales increased by 2.2 per cent and rose 3.2 per cent in the last 10 weeks of the period.
In brewing, revenue and operating profits increased by eight per cent against a strong performance in the same six months of 2017-2018.
Chief executive Ralph Findlay said it had been a "decent" first half of its financial year
"I am pleased to report continued growth across all segments of the business.
"Our taverns wet-led community pubs have built on the strong trading performance last year and it is particularly encouraging to see our food-led pubs once again achieving increasing momentum in profitable like-for-like sales growth.
"Our leading brewing business goes from strength to strength, winning new distribution contracts and continuing to grow market share.
"We remain focussed on our strategic objectives and good progress has been made with our stated aim to improve cash generation and reduce the group's leverage.
"Whilst the backdrop of ongoing uncertainty around Brexit continues to be challenging, opportunities for growth remain and we are confident of delivering another year of profitable growth for our shareholders."
Mr Findlay said that increased promotional activity and new menus had helped boost sales at food-led pubs along with getting involved in trends like vegan food.
In January Marston's, which has an estate of 1,551 pubs and employs 14,500, announced plans to reduce debt by £200m by 2023 and reduce capital investment to around £25m a year from 2020.
Mr Findlay said the group had already taken steps to make interest savings of £5m a year.
Over the next four years it plans to sell assets of between £150m and £160m and is on course to raise £45m to £50m this year
Although investment is being scaled back, the group is continuing to build new pubs and it bought 15 former M&B pubs at the beginning of the year including The Foley Arms at Aldridge.
Marston's will open nine new pub/restaurants and three lodges in the current financial year and six pub/restaurants in the following year.
"We are still targetting growth, but somewhat more cautiously given the level of uncertainty in the market," added Mr Findlay.