UK. Marston’s: managed pub sales boost

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Marston’s has announced a 2.9% uplift in like-for-like sales in its managed pubs division for the 42 weeks to 23 July.
The company said its performance has been “encouraging” and “robust” despite the difficult trading environment. Profitability is in line with expectations.

At Marston’s Inns and Taverns, its managed house division, like-for-like food sales grew 5% over the 42 week period with like-for-like wet sales up 1.7%.

In the last 10 weeks, like-for-likes were up 2% against a strong trading period last year, which included the World Cup and good weather. Operating margin has improved compared to last year, it said.

In Marston’s Pub Company, its tenanted and leased pubs division, underlying profit trends have continued to improve. Like-for-like profits are estimated to be 0.5% ahead of last year.

It attributes this rise to the continued rollout of its franchise Retail Agreement, where licensees earn a percentage of takings and pay no rent. The agreement is now operating in around 300 pubs.

The deal sees licensees typically earn 20% of turnover to pay themselves and staff, with Marston’s buying everything else and paying the bills.

Marston’s also said that those pubs expected to stay on traditional agreements for the long-term are trading ahead of last year.

Its own brewed beer volumes are up around 2% on last year at Marston’s Beer Company with premium cask ale up 4%.

Net debt and cash flow is in line with expectations and it has completed 10 new build pub-restaurants to date. Performance of new builds continues to be ahead of its original targets.

“We are encouraged by the resilience of our business in the year to date,” said chief executive Ralph Findlay. “Our focus on offering value for money with high service standards in a quality pub environment is generating strong consumer appeal and maximising returns on our investment programmes.”