Greene King adapts to changing customer habits with 'wellbeing' a key concern among millennials
PUBLISHED: 11:07 27 June 2019
Adam Smyth / Greene King
Wellbeing remains a key concern among pub customers, with changing consumer habits including a greater demand for healthy food and drink driven by millennials, according to a Suffolk-based brewery and pubs giant.
Bury St Edmunds-based Greene King, which has just published its full-year results, saw turnover rise by 1.8% to £2.2bn against a backdrop of a sea-change in attitudes, including customers placing a greater importance on sustainability.
The group, which employs 38,000 people across the UK, said goodbye to its chief executive of 14 years, Rooney Anand, on April 30, 2019, and welcomed his replacement, Nick Mackenzie.
MORE - Greene King boss urges thousands of EU staff to stay post Brexit as he prepares to call time on 'very special part of my life'
The incoming boss faces challenges including rising customer demand for 'experiential' offers against the backdrop of a year without a major football tournament such as the men's World Cup or the European Championship to buoy sales.
Last year's company performance included a rise in revenues within its Pub Company arm, where, despite a 2.5% drop in pubs trading to 1,711, revenues rose by 1.8% to £1.8bn.
The company, which has a 'Pub Company' (managed pubs) and a 'Pub Partners' arm, operates 2,730 pubs, restaurants and hotels across England, Wales and Scotland, of which 1,687 are retail pubs, restaurants and hotels, and 1,043 are tenanted, leased and franchised pubs. Its leading brands are Greene King Local Pubs, Chef & Brewer, Farmhouse Inns and Hungry Horse, with 81% of the estate either freehold or long leasehold.
In his end of year message, chairman Philip Yea paid tribute to Mr Anand. "Rooney proved himself to be one of the most successful business leaders of our industry and during his tenure the company has been transformed," he said.
You may also want to watch:
He added he was confident Mr Mackenzie would "prove to be an outstanding leader for the business and drive continued evolution at Greene King".
Mr Mackenzie described Greene King as "a great business with a rich heritage, a high-quality estate, a strong portfolio of brands and 38,000 talented team members". "I am looking forward to building on Greene King's strong foundations with a focus on innovation, on developing our people and on customer service," he said.
Greene King's Pub Partners revenue fell by 2% last year to £190.1m, driven by a 5% fall in the average number of pubs trading.
Meanwhile its Brewing & Brands arm saw revenue rise by 5.8% to £227.6m with total beer volume growth of 0.9%, buoyed by good weather and the World Cup.
Overall, the number of licensed premises in the UK is in decline, falling by 2.3% in the year to March 2019, driven by closures of drink-led pubs and a recent rise in restaurant closures.
But the company was able to "react dynamically" to shifting consumer behaviour, said Mr Mackenzie.
"We extended the Greene King brand into more food-led pubs this year, helping to improve our drinks offer in those pubs. We also transferred 11 pubs from Pub Company to Pub Partners and four pubs from Pub Partners to Pub Company," he said. The company's overall goal was to be "the best pub and beer company in Britain", he added.
In the last financial year, the company disposed of 46 managed pubs, generating £26.6m, completed five new builds under the Farmhouse Inns brand and made four site acquisitions, three of which will open in the new financial year.
Political and consumer uncertainty is likely to continue to weigh on confidence, the firm predicts, and inflationary pressure continues.