Wells sets 20% target to boost pub portfolio
Bedford-based brewer Charles Wells has set a target of increasing its pub estate by 20% by September 2008.
The company wants to boost its portfolio of pubs from 251 to 300 in the next couple of years.
Only six pubs were bought by Charles Wells last year so it is now targeting small chains to hit its acquisition target of 20 pubs a year. There are few opportunities for acquisition of individual pubsWells managing director Paul Wells
Managing director Paul Wells said:
"There are few opportunities for acquisition of individual pubs so our strategy has therefore adopted more flexibility.
"The purchase of a small to medium-sized chain of pubs appears to give us the most realistic chance of achieving ownership of 300 pubs within the timescale."
News of the pub estate expansion plan comes as Charles Wells revealed turnover climbed £28m to £138m in the year to 30 September 2005, with trading profit up more than 35% to £5.9m.
Beer volumes were up 2% overall to 304,000 barrels.
But when imported beer such as Corona Extra is included, the overall volume of beer sold rose 18% to 515,091 barrels.
Sales of Bombardier grew by 14% in the UK with a rise of 19% in the four weeks leading up to and including St George's Day - 200,000 extra pints compared with 2004.
Licensing reform was described as an "enormous task" that involved 29 pages of forms for each pub and cost £300,000. Despite this it was a good year for exceptional profits with Charles Wells netting £2,396,000 from selling surplus land and property - a figure more than twice as high as any in the past decade.
The company's small 16-strong managed division grew sales by 3% and profits by 11%.
Wells said: "A strategic review in 2005 confirmed the benefit of a small managed division and tasked the team to provide profit after all costs, which was achieved."
The 235-strong Pub Alliance tenanted division saw profit grow by 16%.
The Disability Discrimination Act led to work costing £120,000 being identified within the estate.
Chairman Alan Jackson criticised new pollution laws which had caused the company to fork out £150,000 on compliance.
"While these rules are worthy, our experience is that we are, and always have been, a very careful company and have not caused pollution, so this regulation is a blunt weapon indeed."
