Rick Bailey, chief executive of Lancashire-based brewer and pub operator Daniel Thwaites, has told M&C Report he expects the company to dispose of more bottom end pubs and reiterated plans to acquire additional high quality sites.
Bailey said the company has had 15 sites on the market and he expects more to be marketed at a later date. “We will continue to weed out the back end of the estate. I should think over time there will be more to come.”
He said Thwaites, which yesterday reported a 24.5% rise in pre-tax profits to £4.9m in the six months to 30 September, has disposed of c100 sites in the past four or five years.
Thwaites generated disposal proceeds of £1.3m in H1 as it disposed of “several poor quality pubs”. Action on possible disposals is decided at the company’s biannual estates review, Bailey said.
Regarding acquisitions, he said: “We’ve not bought a great deal these last few years. We’ve probably bought a handful of pubs and a couple of inns.
“Most of those have been in the north of England. There’s still more to go at out here, but that wouldn’t preclude us looking further.”
He added: “It’s about quality rather than quantity.”
In 2012 Thwaites agreed its first tenancy deal with a microbrewery that lets the tenant stock its own beers free of tie. Wigan-based brewer Prospect and All Gates have so far taken the deal and Bailey said discussions have taken place with other small brewers. Although no deals are imminent, he said: “If we could get the right deals we would probably do more.”
In total £2.2m was invested in the pubs refurbishments in H1 and the company plans to spend c£4m across the full year, Bailey said: “We are getting visible returns on that. It’s about improving the quality of the estate.”
He said there would be more investments in its existing Inns of Character sites.
Sales in H1 grew 1% to £71.9m. Operating profit before exceptional items was up 5% to £6.9m. Operating profit in the Beer Co and Pubs division grew 5% to £4.2m, with a rise of 6% (to £3.3m) in the Hotels and Inns arm.
