Bosses from Britain’s biggest landlord are planning a multi-million pounds makeover to help pubs claw back business following a “challenging” six months.
Solihull-based Enterprise Inns has already spent £29 million on refurbishment projects at 260 pubs and it expects to complete work on another 600 this year.
The firm is hoping that the Government’s recent beer duty cut will help warm up the licensed trade after the freezing winter kept drinkers away from their local pubs.
Enterprise, which leases out more than 6,000 pubs across the UK, said half-year sales were 4.2 per cent lower. It reported that business during the six months to the end of March was “particularly challenging” and shrunk pre-tax profits by 14 per cent to £55 million.
But it said recently-improved trading has slowed the like-for-like sales slide to one per cent, boosting its hopes of a return to underlying sales growth in its second half.
The coldest spring since 1952 combined with weak consumer spending and the ongoing disposal of pubs to drag overall half-year sales almost nine per cent lower to £312 million.
It sold another 161 pubs during the six months to March, raising £54 million to reduce its debt mountain to £2.7 billion. Enterprise expects to sell pubs worth £150 million during the year.
The group also said it was encouraged by a 17 per cent drop in business failures. It spent £3 million during the six months to help struggling landlords.
Chief executive Ted Tuppen said: “Trading in the first half of the year has been particularly challenging. The heavy snowfalls in January and the coldest spring for many years have not encouraged customers to venture out to their local pub. Against this backdrop we are satisfied with the results for the first half of the financial year and are encouraged that in recent weeks we have seen a recovery in trade.”
Enterprise has struck a deal with brewer Molson Coors to cut the cost of pubs’ Sky TV package by 30 per cent or £3,000 a year for each pub.
It is also rolling out free Wi-Fi internet at its pubs after agreeing a tie-up with Arqiva, which will save its publicans about £500 a year.
The group welcomed a 1p cut in beer duty, but slammed proposals for a statutory code to enforce the relationship between pub companies and tenants.
Campaigners say the reforms are vital to allow licensees to buy beer at competitive prices and ensure fair market rents. But Enterprise said the proposal is based on “flawed, misrepresentative and at times misleading” evidence and insisted the current voluntary code works well. The government-backed consultation closes in June.
A proposed code put forward by the government would contain mandatory rules for all companies owning more than 500 pubs and aims to ensure that “a tied tenant should be no worse off than a free-of-tie tenant.” In the consultation document the government says it “seeks to support a healthy, thriving and diverse pub sector.”