G1 Group, the Scottish leisure operator, has reported a 10% rise in pre-tax profit on turnover up 8% to £49.3m for the year to 31 March 2011, after adding new sites and making investments in its estate.
Pre-tax profit was £4.709m, with turnover up 8% to £49.3m and operating profits up 5.3% to £6.3m for G1 Group, which operates pubs, bars, restaurants and hotels across Scotland. Ebitda was £12.3m.
Capital and investment expenditure was £7.3m, including a “seven figure” investment in EPOS/IT technology. “The focus is on maximising returns from the existing estate which will ultimately lead to the ability to grow, albeit with consideration and maximum due diligence,” the company said.
New openings in its c.40-strong managed estate included the Ghillie Dhu in Edinburgh and Mitchell’s Deli in St Andrews, with refurbishments carried out at the Corinthian Club and Grosvenor Cafe in Glasgow. New assets increased by £2.8m to £31.4m at the year end.
G1 said Iona Pub Partnership, it’s 110-strong tenanted arm, has “been able to weather the current economic difficulties through its proactive, hands-on approach to the business”.
New initiatives in the division have included help with training via a link up with the Tennent’s Training Academy, plus other schemes including Business Building Blocks, with lets tenants spread payments for essential services at reduced costs.
The company said: “With a strong balance sheet and the benefit of a 97% freehold estate, G1 Group looks forward to 2012 with cautious optimism.
“The company has continued to invest heavily in its core estate to maintain its reputation for unique and exciting venues. The acquisition of a number of key east coast properties in summer 2011 gave the group a significant new presence in the capital.
“Operating in the leisure market, the most significant risk is customer demand in an extended period of economic uncertainty.
“Other risks are changing regulatory requirements such as health and safety legislation, and the impact of rising utility costs. The group has to address these and other exposures on a continuing basis. The widely diversified leisure portfolio and the significant purchasing power which it has, enable the group to mitigate these exposures.”
G1 paid interim dividends of £32k (2010: £50,153). The directors did not recommend a final dividend be paid.
The company is set to relocate its head office to the former BBC Scotland head quarters in Glasgow’s West End in 2012.
In July, G1 announced a new venture with troubled bar and hotel company Festival Group, which entered pre-pack administration, to run four of Festival’s Edinburgh venues. The deal, for an undisclosed sum, saw the formation of a new venture within G1 Group called EH1 Limited.
