Punch suffers body blows in a week to forget

Punch Taverns' numbers were worse than many were expecting, (see below) to the extent that at one stage its shares sank more than 22 per cent on the day it announced them. There there is the looming redundancies programme. It was the start to the year the company could have done without.

Whether other companies reporting in the coming weeks reveal as gloomy a set of figures remains to be seen. Few in the City expect other quoted companies to report anything like the sort of dip that Punch has 'fessed up to.

One City analyst described Punch's trading update as containing "the worst figures we've seen from any mainstream company in the sector", a claim to fame I'm sure chief executive Giles Thorley would gladly eschew.

The self same stock-watcher made another deliberately obvious point, namely that in a recession profits are likely to fall. In such a market as this, surviving without making much - if any - money is better than being forced out onto the street, he argued.

But it was the scale of the trading decline since Punch last updated the market in November that focused many minds. As one said last week, assumptions made for both Punch's leased and managed operations "now look too optimistic".

With the group's shares nose-diving the question bubbling on many people's lips is will the company go bust any time soon?

And, meanwhile, the need to free up cash in order to eat away at the group's debt is paramount, and disposal activity is set to increase. If Punch can get away the 500 pubs it has earmarked for sale all well and good. The thing is, who's going to buy them in the current financial climate?