Bury St Edmunds-based Greene King reports strong start to new financial year
- Credit: Archant
Pubs and brewing group Greene King has reported a strong start to its new financial year, but says it is “alert” to the potential impact on leisure spending from Britain’s vote for Brexit.
Bury St Edmunds-based Greene King said its managed pubs division saw like-for-like sales growth of 1.7% in the 18 weeks to September 4, benefiting from better weather and the Euro 2016 football championship.
Greene King is now the largest operator of directly managed pubs in the UK following its acquisition of the Spirit Pub Company, the integration of which is continuing with a rationalisation in the number of retail brands within the combined business.
At Greene King’s leased and tenanted pubs business like-for-like net income was up 4.5% in the first 16 weeks of the year, although on the brewing side own-brewed volumes dipped 0.5% during the same period.
In a trading update released ahead of its annual general meeting today, Greene King said: “We continued to make strong progress with the integration of Spirit including the delivery of further planned synergies and over a quarter of our managed pubs now operating with the ‘best of both’ IT system. We also completed 41 brand conversions in the year-to-date with encouraging sales uplifts.”
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It added: “As expected, uncertainty surrounding the UK’s future withdrawal from the European Union has translated into a softening of some economic indicators and a reduction in consumer confidence.
“While the broader implications remain unclear, a number of recent industry surveys have flagged risks to leisure spend and we are alert to a potentially tougher trading environment ahead. With this in mind, we will continue to focus on delivering great value, service and quality to our customers.
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“Greene King has a track record of success in challenging trading environments and our strong balance sheet and enhanced opportunities following the Spirit acquisition will help limit any potential impact from prolonged uncertainty in the environment.
“We remain confident of delivering another year of strategic and financial progress.”
Greene King, which ranks second in the EADT/EDP Top 100 listing of the 100 largest companies based in Suffolk and Norfolk, reported an adjusted pre-profit, excluding exceptional items, of £256.5m for the 52 weeks to May 1, an increase of 52.2% on the previous year.
The increase was driven by the £773m acquisition of Sprit, completed in July 2015, which saw group revenue increase by 57.6% to £2.073bn.