Greene King Shows Resilience
Greene King, the UK brewer and pub group, has reported a 1.9% increase in revenue to £1.051 billion and a 0.2% rise in profit before tax, exceptional and non-underlying items to £128.2 million for the 24 weeks to 14 October 2018, compared to the corresponding period in the previous year. Revenue growth was fuelled by strong sales performances in the group’s Pub Company and Brewing & Brands businesses.
Pub Company delivered total sales of £850.3 million, up 1.6% from 2.4% fewer pubs. Pub Company operating profit was £134.2 million, down 2.0%, and the operating profit margin was 15.8%, down 0.6% pts, due to cost inflation and other factors.
Brewing & Brands revenue was up 7.5% to £110.0 milliion following the good summer weather and the World Cup. Operating profit was up 1.4%, while the operating profit margin was down 0.9% due to mix, with an increased sales contribution coming from third party beers.
Revenue at the Pub Partners business fell 1.3% to £90.9 million due to 4.6% fewer pubs trading year-on-year. Pub Partners operating profit margin was down 1.8%pts.
Rooney Anand, chief executive of Greene King.
Rooney Anand, chief executive of Greene King, comments: “We have seen continued positive momentum in Pub Company, which was sustained beyond the boost of the World Cup and the summer weather. The hard work of our teams, combined with the investments we made to improve our customer experience, is driving sales outperformance to the market. We remain highly cash generative, meeting our debt repayment requirements, investing in our pubs and paying an attractive, sustainable dividend out of operating free cashflow.”
He adds: “Looking forward, Christmas bookings are up on last year and we look forward to ensuring customers have a great time celebrating the festive season in our pubs. Ongoing uncertainty around Brexit may impact on consumer confidence, but as a team we are focused on our key strategic priorities and remain confident of our outlook for the financial year.”
At the end of the period, Greene King operated 2,798 pubs, restaurants and hotels across England, Wales and Scotland, of which 1,714 were retail pubs, restaurants and hotels, and 1,084 were tenanted, leased and franchised pubs. Its leading retail brands are Greene King, Chef & Brewer, Farmhouse Inns and Hungry Horse.
Greene King also brews quality ale brands from its Bury St Edmunds and Dunbar breweries. Its portfolio includes Greene King IPA, Old Speckled Hen, Abbot Ale and Belhaven Best.
