McMullen’s experienced a strong festive trading period, with London sites hitting new sales records in December and festive trading across the estate up 13.5% vs 2019 on a like-for-like (lfl) basis, joint MD Heydon Mizon tells MCA.
Sports pubs also received a significant boost from the World Cup and major sporting events, while all key Christmas trading days saw strong sales, according to Mizon.
Post-pandemic, the 130-strong, Hertfordshire-based brewer has continued to build its proposition by investing in a more experiential offer for the younger demographic in its high street pubs alongside a refreshed and more premium beer portfolio.
“High street sites have flown and not stopped growing since lockdown,” Mizon says. “We have struggled a bit with growing profit in our country dining pubs, but everything experiential with cocktails, premium beer, and DJs has really flown.
“We’re keen to acquire quality freehold assets in the Southeast this year; we’re consistently looking in London and surrounding areas.”
The business has a current estate of eight managed pubs in London, with a further pipeline in place.
“London was the first and hardest hit with lockdowns, but it’s been phenomenal this year even with the train strikes,” Mizon continues.
London sites have been boosted by corporate bookings that were happy to rearrange around train strikes as they were announced. While London and pubs with a “younger guest profile” across the estate have done well, the business have seen a decline in food covers during the year across the estate. This has been noticed most amongst pubs with older guests.
However, the business bounced back into covers growth vs 2019 during December, a trend it hopes will continue, according to Mizon.
Despite seeing significant cost inflation and putting through price rises, McMullen’s is attempting to mitigate further rises without compromising on quality.
“We’ve had to move prices, but not as much as the market, so there’s still opportunity to move them further,” Mizon says. “We are mindful that price movement impacts volume and guest retention is a lot cheaper than guest acquisition.”
“For us, the biggest worry is cost inflation, not sales…we’ve been growing lfl sales, which is good in a tough economic environment, but costs are going up significantly and whilst we expect the rate of increase will soften from mid-year, it isn’t going to stop.”
While staffing was another key priority last summer, McMullen’s continues to work on its retention strategy and with team turnover below 80%, leading to only moderately impact from staffing concerns at the height of the summer. While energy costs are still a concern, the business is well hedged.
Following a strong Christmas, the brewer is forecasting a good year of sales but with inflationary costs in play, profit conversion will be more of a challenge versus prior years.
“There is a lot to look forward to in 2023.”
