Marston’s saw like-for-like sales in its Destination arm fall 1.8% in the 26 weeks to 31 March, but its Taverns division reported a 2.9% uptick.
Total revenue in the Leased estate was up 3.9% to £26.8m, with rental income up 2% and profit per pub increasing 2%.
In the brewing business, the group said that total volume was up 74%, market share growth in premium cask ale was up to 23% and premium packaged ale to 24%. Marston’s is on track to deliver at least £4m target synergies from its acquisition of the Charles Wells Beer Business (CWBB), which it said had helped it penetrate new markets and geographies.
Total underlying group revenue grew 19.8% to £528.1m, principally driven by the acquisition of the CWBB new openings and pub acquisitions and positive like-for-like sales In Taverns business.
Marston’s opened six sites during the period and said it was on target to open 15 for the financial year. Six lodges have opened, taking the estate to over 1,500 rooms. The group is targeting ten pubs and bars and five lodges in 2019, a net capital reduction of £25m from the original programme.
Underlying profit before tax was up 7.7% to £36.3m. On a statutory basis, the loss before tax was £13.4m principally reflecting accounting adjustments relating to the estate valuation and changes in the fair value of interest rate swaps.
Group operating margins were 2% behind last year reflecting increased costs in Destination and Premium, the continued impact of converting pubs from tenancy to franchise, the short-term dilution impact of the distribution contracts in Brewing and the CWBB acquisition which operates at a lower margin than Marston’s existing beer business.
Chief executive Ralph Findlay said: “We are pleased to report another period of good growth in revenue and underlying profit before tax. Strong trading in Brewing and Taverns and Leased pubs offsets the adverse impact of poor weather on ‘drive-to’ pubs in our Destination estate, further validating the resilience of our model.
“We have made modest and prudent adjustments to our capital plans to reflect the current economic and consumer climate. However, Marston’s is a balanced business and we are confident that the medium-term outlook for the eating-out and wet-led pub sectors remains good and that targeting an increased profitable share of a growing market through an unremitting focus on quality, service, standards and value for money remains key.”