Record first-half sales for Greene King
PUBS and brewing group Greene King today reported a 17% jump in first-half profits, with record sales for the period defying evidence of consumer uncertainty elsewhere in the economy.
The Bury St Edmunds-based company posted a pre-tax profit of �73.1million for the 24 weeks to October 17, up from �62.4m at last year’s half-way stage.
Greene King also announced a restructuring of its operating divisions which will see the current head of its brewing business in Bury leave the company at the end of the year.
Turnover grew by 4.2% on last year’s first half, from �464.5m to �484.1m.
Managed pubs division Greene King Retail, the group’s largest business, achieved like-for-like sales growth of 3.8%, on top of 4.6% growth last year. Total revenue was 5.5% up at �293.4m and operating profits were 9.8% ahead at �57.2m.
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Pub partners, the tenanted and leased pubs division, saw revenue dip by 1.2% to �68m and operating profits by 1.0% to �30.6m. However, taking into account a reduction in the size of the estate, like-for-like profits edged into growth at 0.4%.
At the Bury-based Greene King Brewing Company, revenue grew by 2.2% to �46.3m and operating profit by 3.1% to �10m. Own-brewed volumes fell 3.7% but, against a 7.4% decline in the overall UK ale market, its market share improved.
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Belhaven, the group’s integrated pubs and brewing business in Scotland which has remained a separate division since its acquisition in 2005, posted a 10.1% increase in operating profits, to �17.5m, on turnover up 5.8% at �76.4m.
However, Greene King said yesterday that it now planned to integrate Belhaven into the rest of its operations.
Belhaven’s retail and tenanted pubs will be integrated into Greene King Retail and Pub Partners respectively while the Greene King Brewing Company and the Belhaven brewing business will be integrated into the one business, to be headed by Euan Venters, the current managing director of Belhaven.
The breweries in Bury St Edmunds and Dunbar will both be retained but Justin Adams, managing director of the brewing operation in Bury for the last five years, will be leaving the company at the end of the year.
Greene King chief executive Rooney Anand said Mr Adams has signalled last year that “he would be ready for a fresh challenge” away from the group.
“I would like to express my gratitude to him for his leadership of, and commitment to, Greene King Brewing Company over the last five years,” said Mr Anand. “He had made a great contribution to our business and leaves us with our very best wishes.”
Mr Anand added: “This has been a successful first half for Greene King. We have ahcieved record interim revenues while growing both profits and margins, driven by industry-leading Retail like-for-like sales growth, further profit improvement in Pub Partners, another record performance for Belhaven and share gains in Brewing.
“We have performed well throughout the downturn and our strategy for growth, via expansion of our retail estate, is making good progress. We are taking positive steps to maintain our momentum by further streamlining the business, reducing our cost base and continuing to invest in our assets and our brands.
“Current trading remains strong, with Christmas bookings comfortably ahead of last year. Although we expect more challenging conditions in 2011, we are confident that we will continue to trae well and deliver strong financial results.”