Profits rise for Greene King as Bury St Edmunds firm progresses strategy to cut tenanted business
The mercurial rise of Greene King has seen the Bury St Edmunds brewery and pubs firm record further gains to its sales and profits.
The company announced its interim results for the 24 weeks to October 14, on Tuesday.
Among the figures, its retail profit in brands including Hungry Horse and Old English Inns, was up 17.4 per cent, and retail like for like sales up 4.3 per cent.
Its brewing and brand division also saw a revenue rise of 2.2 per cent while its average earnings before tax, deductions and interest (EBITDA) in Pub Partners, its tenanted, leased, and franchised business was up 3.9 per cent.
But the number of pubs in Pub Partners was down by 58 sites to 1,326.
Chief executive Rooney Anand said: “While we are growing our retail business which is our largest and fastest growing busineses, we are reducing our tenanted business to make sure its high quality is sustainable.
“Some are irreversably challenged.”
He said that competition both from Greene King pubs and other big names like Wetherspoons, meant some pubs were inevitablty struggling, but Greene King would explore all options including changing tenants, before eventually selling the site.
“It is not something we do lightly,” he said.
But it has boosted the number of pubs in its retail division by 20 and says its main focus is on growing its Hungry Horse and Cloverleaf brands.
The business achieved a revenue of £566.2m, up 7.3 per cent, while operating profit rose by6.1 per cent to £122.7m.
The first half of the year also saw the firm buy eight pubs for £5.9 million and acquire another six sites for development
Mr Anand said the challenge is to deliver a good experience of food and service to customers.
“They are a bit cautious about spending money in this climate – quite rightly – who wouldn’t be?
“It is a never ending quest to improve and make sure we are in keeping with our customers’expectations,” Mr Anand said.
The company, founded in 1799, now employs more than 21,000.
It operates 2,298 pubs, restaurants and hotels – 972 of which are within its retail brands.
Core brewing brands include Greene King IPA the number one cask ale in the UK, Old Speckled Hen the number one premium ale in the UK and Abbot Ale the number one premium cask ale in the UK.
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Wednesday 19 June 2013
Temperature: 13 C to 25 C
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