Shepherd Neame, the Kent-based family brewer and pub owner, unveiled "encouraging" half-year figures this morning which showed turnover up 7.4% to £43m, like-for-like sales in its managed pubs up 8.7% and sales of its flagship beer Spitfire up 27%.

However, operating costs outpaced the rise in turnover, with operating profit up by 6.1% to £5.4m, and profits before tax were down 2.7% to £4.28m because of lower property profits.

Jonathan Neame, the company's managing director, said: "This has been an encouraging six months in all areas of our business, pubs, brands and brewing. We have seen a strong performance in our managed houses and continued our policy of developing our presence in London, where we have leased three more pubs.

"Our increased advertising expenditure on Spitfire has helped it gain national distribution, with sales up by 84% since 2000. On the brewing side, we have laid the foundations for future expansion with the potential to move distribution and warehousing off-site. We look forward to the future with confidence."

Total beer sales volume grew by 4% to 216,000 barrels. The managed house division saw invested like for like growth of 8.7% and uninvested growth of 2.9%. The company now operates 368 pubs in the South East of England, of which 299 are tenanted.