Charles Wells reports 20% increase in profits

Bedford-based Charles Wells has reported profits up by 20% on record turnover in results for the 52 weeks to September 2008.

The results mark the second set of financial accounts since the formation of Wells and Young's Brewing Company and Charles Wells Pub Company's move to a purely leased and tenanted pub estate.

Turnover increased by 7% to a record £225.1m with operating profit up 20% to £10.5m. "This was a tough year because of a tightening market, but these are an encouraging set of results," said Charles Wells chief executive Paul Wells.

"The economy has weakened since the summer so 2009 will be increasingly a challenge but our strategy in pubs and beer brands is paying off."

Tenant support​

Despite one of the most challenging years faced by the UK pub industry, Charles Wells Pub Company achieved an operating profit of £6m, and earnings before interest, tax, depreciation and amoritisation (EBITDA) was up 2%.

The pub company purchased three pubs in the UK at a cost of £3.2m, two pubs in France and continued its focus on investment in existing houses, with eight major refurbishments, and a total refurbishment investment of £3.8m.

At September 2008 the company was operating 241 houses. Sales volume of beer in the pub company fell by three per cent in the year against a market decline of over 8 per cent.

Overall, there was a slight increase in total income per pub. "In this year we reviewed and strengthened the support we provide for our licensees so in the current market our pub trading figures are fairly robust," said Wells.

"We are committed to investing and growing our pub estate but it's hard to find pubs that are worth buying at the moment. The focus in 2009 will be to maintain the high quality of the estate, support our licensee partners and deliver a great pub experience to customers."

Brewing​

2008 saw Wells and Young's sales of own-brewed beers reach a record level with growth of 8.3%, with total beer sales grew 6.8% in a UK market that declined by 8.4%. This was chiefly driven by the continued success of flagship brands Wells Bombardier and Corona Extra, combined with the first full year's contribution of the Courage brands.

Wells added: "Wells and Young's has one of the most enviable ranges of cask, premium bottled ale, speciality lager brands and wines from any brewer. Our beer brands are out performing the market and we have seen a revival of interest in British cask beer. We intend to maintain investment behind our brands with the highest quality marketing to continue their growth."