Everards sales halved in year of lockdowns
LOSS REPORTED BUT BOSS SAYS BUSINESS IN A STRONG POSITION
THE boss of Everards says sales halved last year due to months of lockdowns.
Stephen Gould, managing director of the Enderby brewer, said sales plummeted as the 154 pub estate was forced to close – or face restrictions – for nine months.
Trade was down a quarter during the Christmas week, picking up a little over new year, as customers stayed home because of fears of the Omicron variant.
He said Everards suffered losses of £3.4 million in the year to September, up from £1.3 million a year before. That compared with a £4 million operating profit in the year pre-Covid.
December 2021 sales were down a fifth on the same month in 2019.
Turnover in the year to September was £15 million – down from £19.1 million a year before that and £30.6 million in 2019.
Since the pandemic began Everards has cancelled £5.6 million of rent for its landlords – equal to 78 per cent of what it would have collected.
Mr Gould said despite all that the business was in a strong position – assuming there are no further lockdowns – with backing from the Everard family, money from the sale of 14 pubs to Hawthorn last May and support from all the Everards team.
He said: “For nine of the 12 months to September, pubs were either fully closed or majorly restricted to trade.
“There was a period with restrictions on the number of people who could sit at a table or on going up to bars – and Christmas 2020 and January, February and March last year saw pubs completely closed.
“There were just three normal months for that full financial year.
“In the year ending April we cancelled £5 million of rent and continued with rent cancellations in May, June, July and August, which wasn’t quite as deep because pubs were beginning to trade again.
“The total amount cancelled was £5.6 million.
“The primary objective has been to retain good businesses within our pub estate – none have shut because of Covid, which has been great.
“We’ve been quite fortunate as we are not carrying many vacancies.
“I think we’ve done a very good job as a company, but so have our business owners who have had to show so much resilience. It’s been a proper team effort, but we are not out of the woods yet.”
He said trade got back to preCovid levels in the autumn – until the Omicron variant forced Boris Johnson to bring in his Plan B.
Pubs got government support of between £2,500 and £6,000 to help tide them over through the period.
Mr Gould said: “The first two weeks of December were pretty good compared to the same time in 2019 and they were holding up quite well.
“Given the challenges of Plan B we were quite pleased with how resilient things have been.
“I think Christmas week was down by a quarter on what we would have expected.
“New year week was probably a little better than that because people had been waiting for the PM’s trading guidelines. That helped create a good level of trade last week.
“It’s not the December we would have wanted but we were still able to trade. Hopefully, if Omicron does ease, customer confidence will return.
“December is a time when our business owners build cash reserves to deal with lower trade levels in the first quarter of the year. Due to Plan B restrictions which impacted consumer confidence, in many pubs this will not have been possible.
“Planned government support by way of grants for business owners is appreciated but sadly does not go far enough.
“As a group, Everards is in very good health. Of course, we would not have wanted the last 20 months, but we are reporting no material concerns in our annual results.
“Considering the hospitality business has been in the front line of the commercial challenges, it’s great we have had our accounts signed off and at the same time invested in our new headquarters at Everards Meadows.
“Of course, if we had another 12 months of significant restrictions it would be a real challenge for us.”
Mr Gould said the government could invest in future growth within the sector by suspending business rates for the first three months of 2022 and reviewing the 2022/23 cap, prolonging the reduced rate of VAT until at least the end of June 2022 and ensuring brewers are included in further compensation grants and rate relief