Marston's growth slows as weather takes its toll

Britain's miserable weather may have put a dampener on things but Marston's, the pub and brewing firm behind the Pitcher & Piano chain, said it continues to make progress across the business, with profitability in line with its expectations.

In managed pubs, like-for-like (LFL) sales for the 42 weeks to July 21st were 2.2% ahead of last year, including LFL food sales growth of 2.4% and LFL wet (i.e. drinks) sales growth of 2.1%.

In the 10 week period since May 12th, (LFL) sales increased by 1.6%. Operating margin is slightly above last year, and the firm remains on track to complete 25 of its high return new-build pub restaurants in the current financial year.

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Ralph Findlay, Chief Executive Officer said: "In recent weeks we have achieved sales growth despite the poor weather, helped by key trading events including the Jubilee weekend, Euro 2012 and Father's Day. By the end of this financial year we will have built around 60 new pub-restaurants in three years, and we have a clear site pipeline for future development.

"In our tenanted and franchised pubs underlying trends have continued to improve with operating profit estimated to be 3.2% ahead of last year. This reflects a strong performance in the franchise estate, which now operates in around 450 pubs, and continued stability and modest growth in the traditional tenanted and leased estate.

"In brewing, we have continued to increase market share with own-brewed beer volumes up around 2.0% versus last year."

Net debt and cash flow are currently in line with expectations.

With sales growth slowing in the last 10 weeks the market expressed its disappointment, pushing the share price down 1.02% to 106.90p by 08:55.

Sam Fuller, head of leisure at investment bank Altium, saidL "Against a backdrop of miserable weather in Q2, 2.2% like-for-like growth by Marstons in its managed pubs represents a decent performance, particularly when put into context of a 5.3% drop in beer sales reported in the same period by the British Beer and Pub Association.

"Marston's performance was undoubtedly boosted by strong trading over during the Queen's Jubilee celebrations and Euro 2012. It will be interesting to see if the Olympics, coupled with Summer finally arriving, can have a similarly positive impact on the pub trade."

NR