Speaking to MCA after taking the reins at the pub company, new CEO Justin Platt discusses how lower ticket visits are proving fruitful for the community operator, the parallels between pubs and theme parks, and what his future strategy might look like
Marson’s revenue growth is being driven by “lower tempo” occasions, according to new CEO Justin Platt, speaking on his first investor call three months after taking charge of the pub group.
Platt, who spent the previous 12 years at Merlin Entertainments before joining Marston’s, says the group’s predominantly suburban, community estate is faring well as consumer confidence returns.
He was speaking to MCA as the listed pub group reported like-for-like (lfl) sales growth of 7.3% for the 26 weeks ended 30 March 2024 (H1 2024).
The 1,395-strong pubco reported total revenue up 5% to £428.1m, with underlying pub operating profit of £52.7m.
The new boss is currently immersing himself in the pub estate, but plans to outline his vision for the future at an investor day in the autumn.
“We’re certainly seeing consumer confidence,” Platt says. “People definitely want to get out and socialise and spend time with friends and family, and we know pubs have a very unique place in UK society for that.
“The interesting thing as society settles down post-pandemic is the move of spend overall, not just in our sector, but overall from city centres to suburbs.
“Allied to this is an increase in lower tempo socialising, a couple of pints here or a quick bite to eat there with the family.
“It’s really helping us with our locally based estate, because 90% of our estate is in suburbia and in the community.
“We’re really finding our pubs are meeting that need to socialise on a local lower tempo basis.”
Platt said there were a “lot of parallels” between Merlin, which operates theme parks and attractions, verses a multisite pub leisure business like Marston’s.
“It’s about giving guests a great time. And if you give them a great time, they’ll come back, and if you monetize it effectively, you can give shareholders a great time.”
He summarised the similarities in consumer leisure businesses as driving demand and attracting customers, increasing revenue per guest, creating great experiences so customers return, and managing costs to deliver profitability.
“That may sound quite simple, but I believe a hospitality business and a pub business is quite simple. It’s about brilliant and relentless execution in those three areas is what will drive success.”
Platt is looking forward to a sport-filled summer, with UEFA Euro 2024 and the Olympics expected to provide great opportunities for the sector.
In terms of his future strategy, Platt is still in the stage of immersing himself in the business.
“I’m immersed in looking at our estate today and immersed in looking at our business today. We will have a good look at what future opportunities will be.
“We’re not at the point yet of being clear on what the answers are to that.
“But what we will be really clear on is pubs meet a variety of different usage occasions, and sports viewing is absolutely one.
“It’s ensuring we have an offer that can deliver against that will underpin our future.”
Marston’s will host an investor day in the autumn, at which point Platt plans to outline his view on the what the future of the pub estate looks like.
In terms of meeting different needs and demographics, Platt said it was important for the pub estate to be clearly focused on its target audience, and different target audience needs.
“Different demographics have quite distinct needs. Some pubs can meet both sets, but you need to be clear about those differences,” he adds.
“The nature of our suburban community estate allows us to work across adults, across younger people.
“We’re less focused in the city centre space, but we are seeing across audiences, this this trend towards lower tempo socialising, where people will just come in for a couple of quick drinks or a quick bite to eat with friends.
“That’s very much the nature of an occasion today, of course people have a range of different occasions, but that is dominating a lot more today than it did a number of years ago.”
