Growing pub group’s recipe for success

THE weather this weekend is unpredictable, but Easter was glorious and pubs were heaving. The hostelries of City Pub Group were no exception. Recommended by Midas at 167p in February 2018, the shares are now £2.28 and chairman Clive Watson is brim-full of confidence about the future.

Restaurants and pubs are closi ng down in t heir droves but Watson tries to offer a different approach to customers. Located in upmarket London areas, such as Chelsea and Parsons Green, and affluent towns including Cambridge, Oxford, Bristol and Exeter, each watering hole is designed to have a local feel. Watson also appeals to sober Millennials with low and no-alcohol drinks, trendy gins and craft ales. Drinks rather than food are the main attraction at his pubs but, with an eye to the hipsters, menus have plenty of vegan and veggie options.

The group is moving into hotels too, or, as Watson puts it: ‘Inns with rooms,’ intended to offer a cosier and more character-filled alternative to budget or corporate accommodation.

Watson’s strategy is delivering results. Revenues rose 22 per cent to £45.7 million in 2018, accompanied by a similar increase in the dividend to 2.75p and a 60 per cent increase in underlying profits to £5.1 million.

Analysts anticipate further growth, as Watson expects to take his portfolio from 44 sites to 54 in 2019 and up to 70 by 2021. He is even benefiting from Brexit, snappi ng up bargains f r om cashstrapped vendors.