Punch Taverns' leased division is likely to reduce in size by a further 1,300 pubs to a core size of 5,000 pubs, division boss Roger Whiteside has told a Numis Securities conference.
The company is still selling between 50 and 80 pubs a month, with one-third going to alternative use.
Whiteside said the company was seeing far fewer pubs being returned compared to last year with greater success in letting pubs to "different types of people".
The estate is still currently 77% wet-led but Punch's analysis has shown that 65% of the core estate offered "entrepreneur development opportunities", 25% of the core estate offers "lifestyle development opportunities" and 10% of the core estate is currently well-invested.
The company is about to start an "Invest for Growth" programme this month that will see 50 or so tenanted pubs receiving between £30,000 and £50,000 investment.
Punch has capped "margin escalation" for itself by restricting wholesale price inflation. "We don't believe the market can sustain margin escalation while beer volume is in decline," he said.
The company will also begin a trial in May that would see Regional Managers — Punch's term for Business Development Manager — looking after just 40 rather than the current 55 pubs each within one of its regions.
The move will mean that some functions, such as rent-setting, will pass to a specialist team.
A new lease agreement, where tenants can opt for free-of-tie prices in return for higher rent, is also in the pipeline.
Punch will also launch a Buying Club for tenants later in the year. Whiteside said: "We have an ambitious aim — to be the most trusted and best value pub partnership business — we've got a long way to go. But our reputation is beginning to change in the market place."