Wolverhampton & Dudley Breweries has reassured the market with an increase in sales at its managed Path-finder pubs.
W&DB, which owns over 2,300 pubs, said Pathfinder had pushed like-for-like sales ahead by 2.2 per cent in the last nine weeks, improving on the latest 0.3 per cent rise it reported at its January annual general meeting.
W&DB had first mentioned subdued trading at its annual results in December, knocking its shares by three per cent despite a 16 per cent increase in profit.
"We remain cautious about the outlook for consumer spending, and anticipate that legislative and cost pressures will continue," chief executive Ralph Findlay said.
"However, we have one of the highest quality estates in the industry and great value offers. As a result, we are continuing to make good progress."
Analyst Greg Feehely at Altium Securities said W&DB's share price had underperformed by 10.4 per cent over the last three months after what was a relatively lacklustre AGM update in January.
"However, given the recently improved performance within the managed pub division this does now look unwarranted."
W&DB also announced that the integration of systems after the recent acquisition of Southampton-based Celtic Inns for £43.6 million would be completed by the end of the month.
"The 70 pubs acquired are a good geographical and opera-tional fit," the company said.
"The acquisition also represents an excellent opportunity for Celtic tenants to access W&DB's industry leading agreements and a much wider brands portfolio."
Total like-for-like sales at both Pathfinder and the group's tenanted Union Pub Company were one per cent ahead of last year for the 24-week period from October 2.
"The group's operating margin remains above last year despite the impact of higher energy prices and the increased minimum wage," W&DB added.
The group said it had identified 93 pubs to transfer from Pathfinder to the Union Pub Company at the end of March.
"As a result we expect to reduce operating costs, helping to offset increases in energy costs and the minimum wage, demonstrating the flexibility of our integrated business model," it said.