GREENE King reported revenue growth of more than five per cent yesterday on the back of strong retail pub sales during the first half of the year.
The company said that food sales and its use of promotions at its retail pubs had led to profits reaching £85.6m, up 5.7 per cent during the six months to 13 October and broadly in line with analysts’ expectations.
However, Greene King’s share price fell 3.5 per cent to 851p due to some profit-taking and a warning in the results over consumer restraint.
“Our retail business is the main engine driving our growth with sales up, and food continues to grow strongly,” chief executive Rooney Anand told City A.M.
“[This was] another strong first half year with solid results across the piece,” he added.
On its estate, Anand said the company is on track to meet its growth goals: “We’re still seeking to expand our retail business to 1,100 by 2015, we’re currently around 1,008 retail pubs, with around 90 sites opening in the next 18 months. We’re making great progress against our goals.”
The company – which operates the Hungry Horse, Old English Inns, Eating Inn and Loch Fyne restaurants – has around 2,300 pubs in total – including its pub partner business which it aims to reduce by 2015.
Sales of Old Speckled Hen, Greene King’s most popular cask ale, outperformed the market with growth of 6.9 per cent, leading sales of brand ale to £87.5m. “The growing interest in beer, craft breweries, and ale, rather than being challenged by it I welcome it, as it’s putting beer on the agenda,” said Anand, adding: “We were very happy to grow our volumes by 1.7 per cent and increase our market share above 15 per cent.”
Anand said trading since the end of the period had been strong and the economic outlook was improving, although he warned that customers remained careful with their money. Greene King’s interim dividend rose 6.3 per cent to 7.6p per share.