Frederic Robinsons, the Cheshire-based brewer and pub operator, has reported double-digit growth in several parts of its business in 2011 as overall sales grew 1% to £54m.
Pre-tax profit for the firm, which operates c360 pubs, fell 26.3% to £1.82m after capex increased from £3.9m to £7.1m, including £2m on facilities for its new brewhouse that began operating in February 2012. A lower profit was also made on disposals - six sites were sold for a profit of £1.2m against 13 disposals for £1.6m profits in 2010 - and distribution costs increased from £3m to £3.7m.
Operating profit in the year fell 70% to £116k.
Chairman Peter Robinson said: “The results for the year 2011 have been achieved in continuing difficult trading conditions.
“We have seen a positive growth in a number of areas of our business, free trade, national accounts, off trade and exports have all been in double digit growth. These are areas we will continue to develop and grow in the years to come.
“Despite a quiet start to 2011 in contract packaging, the demand towards the end of the year rallied. The first quarter of 2012 has been our busiest ever and signs are encouraging for the rest of the year ahead.”
During the year, sales to the tied and free trade grew from £40m to £41.7m, with volumes in these sectors up 1.6%.
Rental allowances to tenants increased from £800,000 to £900,000. The granting of rental allowances combined with bottom-end disposals saw rental income fall from £6.8m to £6.7m.
Robinson said: “We continue to focus on the economic performance of each of our houses. Moving forward we will be concentrating on increasing our support for our tenants and improving our levels of service to their businesses.
“We expect an increasing focus on the smaller refurbishment projects that give an improved income to both the tenant and the brewery.”
A decision pass over day to day management of temporary managed houses to a third party reduced turnover by £0.8m. Robinsons said the move is expected to have lead to “significant future savings in this area in future years”.
Capex in the year included £2m on new brewhouse facilities, £2.7m in the tied estate, and £1.6m on new distribution facilities.
Contract packaging sales fell from £5.2m to £5m, and rose 3% by volume.
In the current year gross profit improved from £7.5m to £8.2m due to lower direct costs. The company said: “The main increases in volume have been concentrated on those areas of trade with lower gross margins so that the overall gross margins have fallen by around 1%. The improvement in volume was concentrated in free trade, contract sales and wines and spirits all of which carry lower margins that the supply of beers to the tied trade.”
Depreciation and repair costs fell by about £0.4m each, while the cost of “rehabilitation” of the tied estate fell by £1.2m.
Robinson said: “We expect that trading conditions will continue to be difficult with continuing reductions in the public’s disposable income.
“The new brewery and our brands launch, a greater economic focus on the tied estate, growth in volume in the many areas of trade and our new management team gives optimism for the future and the long term prosperity of the company.”
