Honeycombe Leisure is buying its fellow North West of England pub operator Devonshire Pub Company for a total of £32m, including debt.

However, the news was accompanied by a warning that company figures were not going to be as good as the City had hoped for.

Honeycombe becomes the largest independent managed pub operator in north-west England with the addition of the 35 pubs to the 54-strong chain.

It has identified 12 to 14 pubs from the enlarged estate for disposal.

Honeycombe's

post-tax profit

in the year to March 2000 reached £2m on turnover of about £12m and EBITDA of £3.6m.

It said turnover and profit would rise in the year to March 2001 because the number of sites had risen by 25%.

But it warned that current-year results were likely to be below market expectations, although they will be ahead of those achieved in 1999/2000.

Current trading outlook was good with February trading 3% ahead year-on-year on a like-for-like basis.

Williams de Broe, its house broker, is looking for pre-tax profits of £3m.