Brewer and pub operator Greene King toasts strong Christmas and New Year’s Eve as festive drinkers lift it to a record
- Like-for-like sales at managed pubs in the last two weeks were up 10.9 per cent
- Sales hit a record £7.7million on Christmas day alone
- Shares in Greene King up 4.5% in morning trading following the update
Brewer and pub operator Greene King toasted to a ‘strong’ Christmas and New Year as festive drinkers boosted sales at its managed pubs.
Greene King, which owns Hungry Horse and Chef & Brewer, said like-for-like sales in the last two weeks were up 10.9 per cent, with sales hitting a record £7.7million on Christmas day alone.
The brewer of Old Speckled Hen and Abbot Ale said sales rose across all in the last six weeks, and that the strong festive performance helped lift like-for-like sales by 3.2 per cent for the 36 weeks to January 6.
Shares in the company rose 4.5 per cent to 578p in morning trading.
Christmas update: Greene King said it had a strong festive trading period, but its own-brewed sales volumes were down 2.3 per cent
However, it has been pointed out that Greene King had easy comparatives to beat.
Russ Mould, investment director at AJ Bell, said: ‘Sales growth has accelerated in its managed pubs division over the past six weeks, helped by a good Christmas period.
‘However, it is worth noting that the pub company had easy year-on-year comparative figures to beat. A year ago trading was hit by snow so mild weather this time round will have worked in Greene King’s favour.’
While sales rose at its managed pubs, Greene King said its tenanted estate saw profit shrink by about 1 per cent.
Total beer sales by volume in brewing and brands were up 1.8 per cent, but own-brewed sales volumes were down 2.3 per cent.
But the group, which also operates seafood restaurant chain Loch Fyne, said it remained confident about the rest of the year despite Brexit.
‘While the ongoing uncertainty around Brexit may still have an impact on consumer confidence and spending during the year, we remain confident of our outlook for the financial year,’ it said in a statement.
Greene King also operates seafood restaurant chain Loch Fyne
Boss Rooney Anand, who is stepping down at the end of April after nearly 14 years at the helm, spearheaded the 2015 acquisition of Spirit Group, which catapulted Greene King into the top spot as the UK’s largest managed pubs operator.
The group said its debt refinancing programme and cost-mitigation programme was on track, as was the disposal of about 100 pubs and the opening of around nine new one in the financial year.
Russ Mould added: ‘Chief executive Rooney Anand is now into his final run before stepping down in April. His successor will inherit a business which is ripe for shaking up, through such actions as selling assets, streamlining some of the brands and tidying up the estate to focus on the more profitable sites.
‘As it stands, analysts don’t expect the business to grow pre-tax profit until the year ending April 2021.’
Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: ‘It’s worth noting that cost inflation means profit growth may not keep pace with sales this year, despite Rooney Anand’s corporate self-help measures, and the group’s tenanted estate has seen profit shrink year to date.
‘Nonetheless these are certainly healthy numbers from the pub group, and will leave investors breathing a sigh of relief.’
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