Punch Taverns issues smoke ban ultimatum

Punch Taverns retailers in England who do not prepare for the smoking ban and then see trade suffer after July 1 will find little sympathy from the pubco, chief executive Giles Thorley revealed today.

Thorley said Punch had spent millions of pounds on smoking solutions and "if we've tried to help and that help hasn't been taken up there'll be no point coming crying to us if a pub's trade collapses once the ban is in place".

In Scotland a small number of pubs had seen a downturn, and here there were a range of causes, he said, which included planning consent problems, competition from nearby sites and "retailer apathy or intransigence".

But pubs in England should prove more resilient to a ban thanks to property type, planning issues and the weather, Thorley said, and the vast majority had plans in place to cope.

However he warned that "no action was not an option" and, if a solution was absent and trading performance "didn't reflect the prospects for the pub [then] we'll have to look at whether that licensee should remain in the pub".

Meanwhile Punch finance director Robert McDonald all but ruled out the prospect of the group becoming a real estate investment trust (REIT) any time soon.

While he said the pubco was still examining all the options available to it, McDonald said the group had found "currently no compelling reason for going down the REIT route".

"Our tax bill is relatively low and given that the tax situation is one benefit of being a REIT, versus the £140m it would cost at the outset to become one, we think it's too early to say that we'll move in this direction," he added.

Punch today announced turnover for the 28 weeks to March 3 2007 up 49 per cent to £921m, a figure which was helped by acquisitions. Pre-tax profit rose 12 per cent to £130m.