Fuller’s has reported like-for-like sales in its managed division up 3.7% the year to 1 April.
The company said the growth was driven by good growth in food and accommodation. In the first nine weeks of the year managed like-for-like sales were 6.6% up.
In the tenanted division profits were down 1% but EBITDA per pub rose 2%. In the first part of this year, like-for-like profits were up 5%.
During the year, completed a strategic review of the tenanted division and identified 20 pubs for disposal. Prior to the period end, four were sold and another 16 held for sale or have been sold since the year end. In addition, two tenanted pubs were sold in the first half of the year.
As part of the review investment in tenanted pubs will be increased by over 50% to around £3m a year. The group also put in place a new agreement based on a turnover rent, which has so far been taken up by four tenants.
In the managed estate, accommodation was the standout area, with like-for-like sales up 6.4% driven by a strong rise in occupancy rates. Total food sales rose 11%, while like-for-like food sales were up 4.5% during the period.
Total beer and cider volumes for the year were down 2%, but operating profits in The Fuller’s Beer Company up 5%. In the first nine weeks of the current year, total beer and cider volumes grew 7%.
Total revenue for the year was up 12% to £392m, with EBITDA up 8% to £70.5m and adjusted profit before tax up 5% to £42.9m.
The group invested £22m in its existing Inns estate during the year and added 71 new bedrooms.
Five new managed pubs were acquired – with £16.6m spent on four of them - The Gun in London’s Docklands, The Albert Arms in Esher, The King’s Arms in Woodstock and The White Star in Southampton.
During the period, it acquired an additional 25% share in The Stable for £2.7m, talking its ownership to 76%, and paid £1.2m in deferred contingent consideration to the former owners of Cornish Orchards.
The group plans to invest £25m in its existing estate this year with a further £5m for implementation of a once in a generation replacement of core systems.
The company filled 66% of vacancies during the year with internal promotions.
Chief Executive Simon Emeny said: “It has been another good year for Fuller’s with a strong set of results for the Company. Food and accommodation have driven like for like sales growth in our Managed Pubs and Hotels and the targeted investments we have made in both new sites and redeveloping our existing estate have generated excellent returns. We have purchased five new sites and completed 25 major refurbishments in the last 53 weeks.
“We are only nine weeks in to the new financial year but we have had a very strong start, albeit against our softest quarter last year, with like for like sales in our Managed Pubs and Hotels up 6.6%, like for like profits in our Tenanted Inns up 5% and volumes in The Fuller’s Beer Company rising 7%.
“There are a number of headwinds that will have a significant financial impact on both Fuller’s and the industry as a whole, but we face the future in a strong position. Our Managed Pubs and Hotels are in good shape and although there is a lot of work and a long way to go, we have a clear vision and solid strategy for both our Tenanted Inns and The Fuller’s Beer Company.
“In short, while we are cautious and realistic about the future, we are well-placed to continue to delight our customers, recruit and develop the best team members and reward our shareholders.”
