Fuller’s, the London-based brewer and pub operator, has this morning reported a 3.2% rise in like-for-like sales across its managed pubs and hotels division for the 16 weeks to 23 July 2011. The company, which made no further comment on its failed approach for Capital Pub Company, said that like-for-like profits across its tenanted pubs grew by 1% over the same period. Own brewed beer volumes in the 16-week period improved by 2%. In an interim management statement the group said that cash generation continued to be strong with net debt at the end of the first quarter at £90.9m, marginally up from £88.5m on 2 April 2011, which was due to the acquisition of five pubs since the start of its new financial year. Fuller’s net debt to EBITDA remained unchanged at 1.9 times. The company said it remained on target to invest £31m in the business this year. It said that its new £4.5m tank farm to support bottled beer growth was on schedule to be completed this autumn, while the first of its seven major refurbishments planned for this year, at the Thomas a Becket in Worthing, had reopened this week. The company said that 27 new bedrooms at its Drayton Court Hotel, which opened last month, had been “a great success”, with occupancy and room rate already exceeding first year targets. As previously announced, Nick MacAndrew is to stand down, after 10 years on the board. His role as the company’s senior independent director he will now pass to John Dunsmore, the former chief executive of Scottish & Newcastle, who joined the Fuller’s board at the start of 2009. MacAndrew’s other role as chairman of the audit committee will pass to non-executive director Lynn Fordham. The group also reiterated that Alastair Kerr, who has held senior roles at a number of high street retailers, would join its board as a non-executive director on 1 August. Michael Turner, chairman, said: “The UK economy remains very difficult to read, but I am confident that our strategy ensures that the company is well placed to deliver good returns to its shareholders even in these continuing uncertain times." Leading analyst Douglas Jack at Numis, said: “We are holding our forecasts – Add, TP: 725p – (Fullers is only four months into its financial year) but believe forecast risk is on the upside. In our view, Fullers has the best like-for-like track record in the quoted pub sector; we expect it to continue to outperform, with potential incremental earnings upside stemming from faster expansion. “Cash generation continues to be strong with net debt to EBITDA of 1.9x. We reiterate our view that Fullers, from the base of having the strongest balance sheet (5x cash fixed charge cover) and the strongest brand, is the best placed operator in the sector to enhance earnings through expansion.”