Pub giant hails World Cup boost, ‘encouraging’ festive bookings
MARSTON’S has hailed a World Cup boost and encouraging Christmas bookings as it posted a swing to profit in the last year.
The pub giant said it is “well-placed to meet challenging market conditions” cost-of-living pressures and part of the year being disrupted by the Covid. The company, which operates around 1,500 pubs across the UK, said it saw sales leap by 50 per cent during England’s first two World Cup games compared with same period in 2021.
As it prepares for its first Christmas without trading restrictions in three years, Marston’s posted an underlying pre-tax profit of £27.7 million in the year to October 1, following a loss of £101.3m the year before.
Andrew Andrea, Marston’s chief executive, also said trading has been positive in recent weeks.
The firm said full-year like-for-like sales were 99% of 2019 figures despite the previous Omicron-hit Christmas trading period, drink sales continued to outperform food sales “demonstrating trading resilience”, and in the final ten weeks like-for-like sales were up 3% on 2019 and 4% set against 2021.
It also reported an increase in pub operating profit to £115.4m from £5.7m.
“Current trading to the end of November has been positive with encouraging levels of Christmas bookings as we look forward to the first-restriction free festive period in three years,” said Mr Andrea. “Additionally, the World Cup has benefited trading, delivering like for like drink sales of around 50% growth for the home team games.”
Marston’s highlighted that overall like-for-like sales across its managed and franchised pubs have been up 6.8% in the last eight weeks, compared with pre-pandemic levels from 2019.
It said this momentum is building towards Christmas, with bookings for the festive period also above 2019 levels.
The firm, which employs 600 in Scotland and has 22 pubs north of the Border, said higher sales were complemented by efforts to offset inflation costs.
Mr Andrea also told the City: “I am pleased to report a strong performance over the last 12 months evidenced by a doubling of revenue growth, a return to profit and steady progress with our debt reduction strategy.
“Whilst uncertainty remains, Marston’s remains well financed and in great shape to weather the challenges ahead with the right formula, the right strategy and the right team to continue to make progress and deliver shareholder value.”
He said that “demand for our predominantly community-based pubs continues to be encouraging despite ongoing macro uncertainty and our estate is well-placed to benefit from changing patterns in consumer behaviour”.
The pub company also said: “We remain cognisant of the current macroeconomic environment with the cost-of-living crisis, the impact of the conflict in Ukraine and the resulting challenges this brings in respect of cost inflation and the potential impact on disposable income, as well as potential supply issues.
“However, pubs have demonstrated their resilience time and time again and, to date, there is little in our trading performance to suggest that there has been a change to consumer behaviour, our guests still want to go out and have an affordable treat in a Marston’s pub.”
Russ Mould, AJ Bell investment director, said: “Shareholders have a return to profit to toast at Marston’s but the pub chain still faces several challenges as it looks to end 2022 on a high note.
“Not least the potential impact of further rail strikes which could lead to cancellations for Christmas parties and people socialising at home rather than struggling with a transport conundrum.
“Marston’s may enjoy some benefit from people feeling too strapped to dine in a fancy restaurant but still keen to go out for a meal with friends and opting for some pub grub instead.”the firm saw its shares lift higher on Tuesday morning, but closed marginally down, 1.29%, or 0.5p, at 38.2p.