Punch Taverns' income is being dragged down by failing pubs but the group has high hopes for the Olympics and Euro 2012 football championships.
Like-for-like net income in the group's core estate of 2,946 pubs declined by 2.9% in the 12 weeks to the beginning of March compared to the previous three months. Comparing the last two six month periods, income fell 2.1%. Punch says this was because of "softer trading" after Christmas, with weaker beer volumes in the months of January and February.
The company also admits that: "the decline in net income continues to be driven by pubs which have been returned to us after failing and are currently under temporary management."
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Pub failures remain "in line" with 2011 levels.
Punch is also busy selling pubs that it does not consider core to the business, saying it is "on track to dispose of between 400 and 500" of these non-core assets by the end of 2012. In the six months to the beginning of March pub sales have raised £62m, just ahead of book value.
The company warns that, without financial support, its two securitisations, Punch A and B, would have remained "below their respective financial covenant levels" during the quarter.
Roger Whiteside, Punch's Chief Executive, said of the results: "While we remain cautious on the near-term consumer environment, we have strong plans in place and expect to benefit from the Queen's Diamond Jubilee, the UEFA European football championship and the Olympic Games in the second half of the year."
Punch shares had fallen 2.2% by 09:29.
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