Midland pub and brewing group Marston’s said trading had been “resilient” as it continued to battle weakening consumer confidence and surging costs.
The Banks’s brewer, which also owns the Pitcher & Piano and Two for One chains, said group sales for the 43 weeks to July 26 rose two per cent on last year as trading was also hit by the impact of smoking bans.
Food sales have continued to rise but income from drinks and gaming machines has fallen.
“The beer market has been impacted by the introduction of smoking bans in England and Wales which has accelerated long-term trends,” said the Wolverhampton firm in a statement yesterday.
In Marston’s Beer Company, although volumes of our own brands remain below last year, we have increased our market share overall and achieved good growth in premium ale. Refresh, acquired in April, which includes the Wychwood brewery in Oxfordshire, has performed well and in line with our expectations,” it added.
In the company’s managed pubs division, like-for-like sales for the 43 weeks were 0.6 per cent below last year’s strong comparatives. More recently, in the 13 weeks to July 26, the sales figure was 0.5 per cent higher than a year ago.
The company’s tenanted and leased pub division, comprising around 1,700 pubs, reported a 1.2 per cent fall in like-for-like profits, with growth in rental income offset by weak volumes and machine income in line with market trends.
It estimated support for tenants would cost it up to £2 million in the current financial year.
Chief executive Ralph Findlay said that although the market was difficult and without any improvement likely in the short term, the group’s food operation was still performing well and growth was being seen in its real ale sales.
“We are relatively well positioned as a result of sustained investment in our food offers, the improvements in our range of beers and premium brands, and our freehold pub estate,” he said.
Blue Oar Securities described the update as reassuring and said Marston’s would emerge from the difficult market as one of the sector’s strongest performers.
It said in a note: “The managed houses are focusing on food, females, families and forty and fifty somethings – the F plan – and the group is helping tenants.
“The group policy of optimising rather than maximising rents has ensured that tenants are in a better position to withstand the current downturn than those of some other companies.”
Marston’s is the UK’s largest brewer of premium cask ales, including Marston’s Pedigree. In addition to the Banks’s Brewery in Wolverhampton and Marston’s in Burton upon Trent, the firm also owns Jennings Brewery at Cockermouth.