Leading analysts Douglas Jack, of Numis, has said he expects Marston’s to continue its pace of growth in the second half of the year, with easier comparisons likely in Q4.

The company reports its third quarter results on Wednesday.

Jack said: “In H1, underlying PBT, excluding disposals and changes in pension costs, rose by 15%. We forecast a similar pace of growth in H2, supported by much easier comps in Q4. Over the next three years, we forecast 30% growth in earnings growth, with net debt/EBITDA falling by 0.4x over this period despite strong expansion and an attractive dividend, yielding c.4.5%. “

Destination & Premium (D&P) like-for-like sales grew 1.5% (vs. a 5.7% comp) in H1, with margins up 50bps and operating profits up 10%. During the first five weeks of H2, like-for-like sales rose 2.0% (vs. a 4.1% comp). Jack said this pace of growth to have continued in a tough market through Q3. He said he expected like-for-like sales to accelerate in Q4, against a -0.3% comp.

The company opened eight new builds in H1, with the full year target of 25 retained. Recently-added new builds have been re-valued up by 40% relative to their build cost. Jack pointed out that from H2 2015E, new builds should start to include some leasehold sites (possibly for Revere and Pitcher & Piano), and five new accommodation lodges pa should open from 2016E (up from three pa).

In Taverns, managed and franchised pubs grew like-for-like sales by 1.4% (vs. a 3.8% comp) in H1, with average profit per pub up 19% due to disposals (65 pubs were sold for £26m, or 21.7x EBITDA) and strong trading in franchise pubs, which accounted for 520 out of 909 pubs at the end of H1. Jack forecast c.2% like-for-like sales in Q3, ahead of softer comps (of -1.3%) in Q4.

In the Leased estate average profits per pub were up 4% (vs. 3% comp) in H1. Jack said: “The comp remains at c.3% in H2, whereas in Brewing, which grew own brewed ale volumes by 4% in H1, comps are tough in Q3 and ease to negative territory in Q4.”

He concluded: “We expect to hold our 2015E forecasts (PBT £90.9m; consensus £91.8m) which assume LFL sales growth of 2.5% in P&D and 2% in Taverns, 1% LFL profit growth in Leased and slightly positive Brewing volumes. We estimate that EBITDA growth/dividends should drive a 26% equity return over the next two years if the EV/EBITDA rating holds.”