Fuller’s toasts return to profit amid ‘fragile’ consumer confidence
Pub chain Fuller’s is back in the black after posting an adjusted profit before tax of £7.2m, as the licensed trade recovers from the pandemic.
In results for the year to 26 March, the pub operator saw profit back in growth after posting a £48.7m loss in 2021, when Covid lockdowns enforced the closure of many pubs.
While the period was still impacted by Covid-related closures, restrictions and working from home guidance, Fuller’s raised a glass to revenue of £253.8m. This was a large leap from 2021’s sum of £73.2m.
With data suggesting consumers are paring back spending at the pub in recent weeks, Fuller’s chief executive Simon Emeny insisted pubs were resilient in the face of economic challenges.
“The great British pub has always been, and will always be, an affordable treat,” he said.
It was good news for the capital too. Emeny said the pub operator had marked “the gradual return of workers to the City and tourists to Central London, which is now underway.”
“Momentum in the City and Central London continues to build, and we are confident that we will see the benefits of our estate’s composition come into play,” he added.
Since the work from home directive ended, the pub chain had seen a “very encouraging” boost in footfall, with tourists and office workers returning, Emeny told CityA.M.
However, the pub boss noted “challenging” market conditions, including “fragile consumer confidence and well-documented high inflationary pressures.”
While chain’s premium offering somewhat protects the company from 40-year high levels of inflation, Fuller’s was “certainly not immune from its effects,” Emeny explained.
Fuller’s had seen “significant” increases in food and utility costs, which it was working to mitigate the impacts of, “without impairing the customer experience.”
The company will take a £4m hit in additional energy costs this year, Fuller’s boss Simon Emeny told CityA.M.
With one pub in London selling a pint for a record £8 price tag, pubs are struggling to strike a balance between keeping prices competitive and covering costs.
However, Emeny said the firm was “quite sensitive” about price increases. “We don’t want to price out customers from coming to our pubs,” he added.
When asked about price increases over the past few months, Emeny said the issue was a “moving feast.”
Some pub chains have announced menu updates in the face of rising ingredient costs, with operator Young’s ditching salmon for the cheaper alternative of trout in recent weeks.
However, Emeny said it was “very important to give customers what they want and not for example, take chicken off the menu because it’s a little bit more expensive than you used to see it.”
“We’re not taking items off the menu just to save money,” he added, while acknowledging that “some proteins” had seen prices spike.