Adnams grew beer volumes 9.1% in 2017 and is now installing equipment to make low-alcohol beers with the aim of introducing a 0% version of Ghost Ship in May.

In a report on trading in the 12 months to 31 December the Suffolk-based family company makes little reference to its pub estate. It notes that there have been a number of disposals in the tenanted and leased estate but stressed that “whilst further change will happen, we feel that we are close to achieving the shape of estate that meets our aims”.

The managed estate has now grown to seven properties and Adnams said that while it remained committed to operating tenancies and leases, managed sites allowed the company “full freedom to present, promote and enhance our brand in a way that suits the property concerned”.

While the company reported turnover up 6.4% to £74.8m for the year, operating profits fell from £3.9m in 2016 to £2.2m last year. The group said this was driven by investment and £1m of income from The Swan Hotel, Southwold, being closed for the majority of the year.

Adnams invested £9.3m in 2017, principally focussed on The Swan and the completion of a three year investment project in the brewery.

Chairman Jonathan Adnams said: “There are still many who view Adnams as being a representative of a traditional group classed as ‘regional brewers’. The category is seen as comprising family-owned businesses, with several generations of history, they own pubs which they supply with beer brewed by themselves, this beer is probably also sold to a wider group of pubs within their region.

“The truth is that few still fit this image. Many have been sold over the years, particularly in the wave of consolidations that took place ten to 15 years ago. The majority of those that remain have tended to focus on pub ownership and have become pub owners who brew, whilst Adnams has become a brewer that owns pubs. Beyond this, Adnams has become a distiller and is evolving to be a high quality branded drinks producer.”

On the outlook for the year ahead, he said: “2017 was a challenging and busy year for Adnams, though one that it was imperative to face to orientate ourselves for the future. Our beer business has for a few years been adapting to the growing market for bottles, cans and kegs. We have invested to allow for our continued growth in these areas. A further move is happening in terms of an increased interest in low alcohol and alcohol-free beers, here too we are investing. The holiday hotel market has been challenged by cheaper competition and by a fast-expanding business in rental properties. Nonetheless, premium hotels offering unique experiences are much prized and we have invested to make The Swan such a destination.

“These changes and investments position us well for the future, however they have inevitably had an impact on our day-to-day operations. They have also made clear the need to have up-to-date systems to help us cope with a changing environment. Our investment in a new central system is focussed on this end.

“Our turnover is growing strongly, Ghost Ship continues its rise, Copper House Gin is cementing its position as a premium product, The Swan is looking at its very best and we believe that we are well positioned to take advantage of the investments that we have made.”