Essex: Increased profit for cricket sponsor Shepherd Neame

BREWING and pubs group Shepherd Neame toasted a near-40% jump in full year profits yesterday but said the summer’s sporting events had failed to deliver a boost to more recent trade.

A strong first half helped Shepherd Neame deliver record turnover in the year to June 30, up 9.6% to �133million, which drove pre-tax profits up 39.7% to �9.1m.

But the company, which was formed in 1698 and claims to be Britain’s oldest brewer, reported a slow-down in beer sales and revenues growth across its managed pubs in the 12 weeks since its year-end as the Olympics and Euro 2012 proved a disappointment.

Chief executive Jonathan Neame said only “a handful” of pubs benefited from the Olympics, while trade in London has been generally down year-on-year since the end of June.

Shepherd Neame said the Queen’s Diamond Jubilee celebrations in June had helped drive sales, but added that the record wet weather had dampened trade amid Britain’s sporting fever.

Beer sales volumes had been flat in the 12 weeks since its year-end, it added, representing a marked slowdown on the 5.6% increase seen in the year to June 30, while like-for-like sales across its 44 managed pubs slowed to 5.1% from 7.6% seen during the full year.

Its larger 310-strong tenanted pub estate returned to growth in the year, with average like-for-like earnings up 0.3%, a trend which has continued in recent trading with sales up 2.5% in the nine weeks to September 1.

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Shepherd Neame is based at Faversham in Kent but owns pubs across South-East England, including a number in Essex where it sponsors Essex League cricket and is also among the Essex county side’s sponsorship partners.

Its range of beers includes Spitfire, Bishop’s Finger, Whitstable Bay and Canterbury Jack as well as a number of lagers brewed under licence, such as Indian brand Kingfisher and Asahi Super Dry from Japan.

It sold 84.1 million pints in the last financial year, with the majority of sales made in the UK, although the company also exports to more than 20 countries.

Shepherd Neame said yesterday said it remained concerned over rising costs and an increasing tax burden, after the Government hit the industry with a 5.1% increase in excise duty in this year’s Budget. Its profit margins have also been put under pressure in recent years by rising costs of wheat and barley, as well as utility bills.

At the group’s annual general meeting next month, former vice-chairman Stuart Neame is reportedly planning to file a member’s resolution hitting out at the board over performance, spending on IT projects and a fall in the company’s share price.