FDBusiness.com

 Marston’s, the UK brewer and pub operator, has reported a 2.7% increase in total underlying revenue to £384.5 million for the 26 weeks ended April 4th 2015, reflecting the contribution from new pub-restaurants, solid like-for-like sales growth, and growth in the Brewing division, over and above the impact of disposals. Underlying operating profit increased by 1% to £66.5 million despite a disposal impact of around £3 million and a £2 million accounting increase in pension costs. Underlying profit per pub improved in all of the group’s pub segments and Marston’s achieved profit growth of 10.3% in Brewing.

Marston’s has an estate of around 1,630 pubs situated nationally, comprising managed, franchised and leased pubs. It is the UK’s leading brewer of premium cask and bottled ales, including Marston’s Pedigree and Hobgoblin. The beer portfolio also includes Banks’s, Jennings, Wychwood, Ringwood, Brakspear and Mansfield beers.

Marston’s strategy is to achieve growth in pubs through investment in attractive new-build pubs, and in its core estate through its managers, franchisees and lessees offering memorable service to customers. In Brewing, the focus is on local and premium draught and bottled beers in a market where there is increasing demand.

Ralph Findlay, chief executive of Marston’s, comments: “Two years ago, we set out our plan to reposition our pub estate, focusing on high-quality pubs with opportunity for further growth. As we approach the end of the transition period, these results demonstrate our plan is working. Profits have increased in each of our trading segments, excluding the impact of disposals, and we remain on track to complete 25 new-builds this year with excellent visibility on our site pipeline in 2015 and 2016. We are also seeing good opportunities to expand our premium estate, Pitcher & Piano and Revere, and invest further in pubs with accommodation. We expect to complete the majority of our disposals programme this year and our momentum gives us confidence of achieving further progress in the future.”

The group’s total underlying Brewing revenue increased by 9.4% to £67.8 million, underlying operating margin was 0.1% ahead of last year, and underlying operating profit increased 10.3% to £8.6 million. Ale volumes were 4% ahead of last year, including growth of 9% in premium ale volumes. The group maintained its market leading position in premium cask ale with a market share of 17%, and maintained its share of the bottled ale market at 21% through continued growth in the off-trade.

Since the period end Marston’s has completed the acquisition of the trading operations of Thwaites’ beer division, including the Lancaster Bomber and Wainwright brands, for a total cash consideration of £25.1 million before working capital. The acquisition is consistent with Marston’s strategy to focus on popular premium ale brands and provides further opportunities for growth in the developing free trade market.