First half profits up at Greene King

SUCCESSFUL acquisitions and growth within existing businesses combined to boost turnover and profits at pubs and brewing group Greene King during the first half of the current year, the company said today.

SUCCESSFUL acquisitions and growth within existing businesses combined to boost turnover and profits at pubs and brewing group Greene King during the first half of the current year, the company said today.

Bury St Edmunds-based Greene King posted a profit before tax and exceptional items of £71.6million, up 7% compared with last year's first half, on revenues of £445.0million, up 6%

Operating profit was 11% ahead, with all of the group's business divisions - tenanted pubs, managed houses, brewing and its integrated Scottish business, Belhaven - all contributing improvements.

Greene King said that operating profit at Belhaven represented a 16% improvement, one year on from the start of the Scottish smoking ban, and like-for-like retail sales were also up in England, despite the start of the English smoking ban in July.


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The company warned that it expected the remainder of the year to be “more challenging” but said it was confident that its strategy would continue to deliver shareholder value.

Greene King, which spent £126.4million on share buy-backs during the first half, representing more than 8% of its equity, plans to pay an interim dividend of 7.3p per share, an increase of 13% compared with last year's half-year payout.

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It added that the Loch Fyne Restaurants business, acquired during the first half, was trading in line with expectations and that the integration of the business was on track, while the acquisition of New Century Inns - made since the start of the second half - had significantly extended its presence in the north of England.

“These record results have been underpinned by sales and profit growth across all our businesses,” said Rooney Anand, Greene King chief executive. “This, combined with £126.4m of share buy-backs, has generated substantial earnings growth in the first half.

“We have had a very successful first half but we expect the remainder of the year to be more challenging. We will, however, benefit from the underlying strength of our business, recent acquisitions and our strong financial management. Overall, we are confident of an earnings performance in line with expectations.

“There are well-documented concerns facing the entire industry: the first winter of the English smoking ban, cost pressures and general consumer confidence. Nevertheless, we continue to seize opportunities to strengthen our business and broaden the appeal of our pubs.

“We have confidence in the resilience of our business model, the quality of our assets, our robust balance sheet and our long-proven strategy. These, coupled with our strong cash generation and profit conversion, will enable us to create shareholder value in the current year and into the future.”

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