Greene King has reported like-for-like sales (lfls) in its managed Pub Company estate up 2.8% for the first 18 weeks of the year, to 2 September.

Ahead of its AGM today the company reported that the division’s lfl growth over the last 10 weeks had been 3.2%.

It said the positive momentum in the pub company had been driven by investment to further improve value, service and quality, as well as the boost given by the World Cup.

In the Greene King branded local pubs lfls grew 5.5%, driven by very strong drink growth. A total of 3.7m pints of beer were sold during England’s seven World Cup matches and lfls on the day of the semi-final were up 61%.

Lfl net profit in the tenanted and leased Pub Partners arm was -0.4% after 16 weeks, impacted by the timing of higher overhead costs which Greene King expects to balance out over the year. Total beer volumes in Brewing & Brands were up 4.0% and own-brewed volumes were up 0.3%.

The company said it remained on track to dispose of 100-110 pubs this year and expects to open around nine new pubs.

It said its cost mitigation programme to help offset gross cost inflation of c£45-50m was on track and it was making good progress with its refinancing programme.

The company concluded: “We continue to focus on profitably driving top line growth, developing a more streamlined and efficient organisation and further strengthening our capital structure to deliver long-term value creation for our shareholders.”

Leading analysts Douglas Jack and Ivor Jones, of Peel Hunt, said this morning’s update from Greene King shows the company remains undervalued.

“The Peel Hunt note said: The EV/EBITDA valuation is below the 2008-09 financial crisis/recession level. In comparison, if managed LFL sales can exceed 1.5% in 2019E, the combination of profit and dividend growth, as well as net debt reduction, should return. Given this and a dividend yield of 7%, we are upgrading our recommendation to Buy.”