Alistair Darby, the chief executive of SA Brain, has told MCA that there is huge scope to drive like-for-like sales within the existing pub estate before the company returns to the acquisition trail.
With the firepower from the sale of a stake in Coffee#1, the Welsh brewer and pub operator plans to invest across its 104-managed and 60 leased and tenanted pubs, as well as bringing on line its new brewery next month.
Darby, who joined the company last July, told MCA that the investments would help boost lfls which dipped slightly across the managed estate at -0.6% in the year to 29 September 2018 but were tracking north of 1% in the year to date. Lfls over the Christmas period grew 8% and Darby said the weekend’s Six Nations clash had led to a record-breaking Saturday.
He said the sale of a majority stake in Coffe#1 to Caffe Nero, resulting in a new joint venture, created opportunities for the brand to go into new territories, whether that meant adding a second brand in geographies where Caffe Nero already exists or targeting market towns which Nero would previously not have operated. However, he said there were no plans to roll out a Coffee#1 hot drinks offer across the pubs estate.
Darby spoke to MCA on the back of the publication of the group’s annual results, which showed group turnover from continuing operations up 1.3% to £117m and underlying operations profit up 55% to £4.1m.
Darby said: “I arrived last year part way through a pretty transformational programme that Scott Waddington and the board had launched. Two key pillars of that were getting the planning permission to redevelop the brewery site and to do a deal on Coffee#1.
“That leaves us in a really exciting position. We have the new Dragon Brewery almost completed, which means we can decommission the old brewery. Then we have huge scope for investing in the pub estate.
“We all but exited the English market in 2017. I certainly wouldn’t rule out going back in but for now the focus is on Wales and ensuring every pub in the estate is performing at its best. There is some low-hanging fruit for us to go at there but also some big projects.”