Fuller’s, the London-based brewer and pub operator, has this morning reported a 10% rise in adjusted pre-tax profit from £26.6m to £29.3m for the 53 weeks to 2 April, driven by a strong performance across its managed pubs and hotels division.
Its managed arm produced like-for-like sales growth of 3.9%. Operating profits grew by 15% to £18.1m, driven by sales growth and margin expansion, the latter improving from 11.5% to 12.3%.
EBITDA grew by 12% to £26.6m, while revenues across its managed estate climbed 7% from £137.9m to £147.2m over the period.
The company said that the eleven pubs purchased in 2009 performed extremely well this year with sales up 20% under its ownership.
The group said performance across the division was driven by growth in accommodation, food and drinks, which all showed strong like-for-like sales growth during the year, up 11.6%, 5.1% and 3.2% respectively.
Like-for-like sales across its hotels estate grew 11.6% last year largely driven by an increase in occupancy of 9%. At the year end the company had 486 bedrooms across 22 of its managed properties.
At its tenanted arm, which comprises 196 pubs, revenues grew by 3% to £26.9 million, despite the disposal of seven sites during the year. Operating profits before exceptional items remained level at £9.9 million. Like-for-like profits were down 1%.
The company said it had increased tenant retention during the period, with every tenant appointed on a substantive agreement during the past 12 months remaining in place. It added that it had reduced vacancies, with 87% of pubs let on substantive agreements and had increased the average EBITDA per pub by 2.6%.
The group’s beer arm, which makes London Pride amongst others, saw operating profits decline by 1% to £8.8 million, which it said was as a result of higher costs driven by an increased proportion of packaged beer going to the export and off trade markets and a £0.3 million increase in marketing costs.
Total beer volumes increased by 2%, which combined with higher duty rates led to a 6% increase in revenue to £104.1m. Its own beer volumes were 2% lower than last year. Volumes in the off trade continued to grow ahead of the market with a 6% increase, whilst export volumes increased 16%.
Overall, group revenues grew by 6% to £241.9 million during the year, while adjusted earnings per share rose by 9% to 37.36p.
The company said it had agreed four pub acquisitions since the year end and including these purchases it currently expects to invest more than £31m in capital expenditure during the forthcoming year, of which £20m will be spent on projects within the existing pub estate and its brewery.
It said that it had made a good start to its new financial year in “what has been a very unusual first nine weeks of trading with a Royal Wedding, five bank holidays and generally very good weather”.
Like-for-like sales in its managed pubs and hotels for the nine weeks to 4 June grew by 6.8%. For the same period total beer volumes were 1% higher than last year.
Michael Turner, chairman, said: "With wages in the UK running behind inflation, our customers' incomes are being squeezed and we will have to work hard in the current year and beyond to earn their custom. We believe, however, that as the consumer is forced to become ever more discerning, our high quality offer of leading beer brands and well invested, often historic, pubs will be increasingly attractive and position us well for growth.
"We have the financial strength to invest further in new opportunities and should benefit from the "London factor" as the calendar turns towards 2012.”
