Brewer and retailer Marston's has revealed that it plans to double the opening programme for new-build managed pubs to 135 in the next six years.
The company is currently opening 60 sites in three years at a cost of £140m. Now the company has revealed it wants to open 25 new-build pubs a year for the three years that follow at a cost of slightly more than £50m a year — the total six-year cost is £300m.
The company will continue to target EBITDA returns of 15% on new-build pubs — it's achieving just under 17% at the first eight sites it has opened.
Marston's chief executive Ralph Findlay said new openings increased the geographic spread of Marston's across the UK to avoid cannibalising existing business.
The company has off-loaded seven tail-end Pitcher & Piano sites in the past six months, four in London.
Findlay hinted that Marston's wouldn't be interested in bidding for the 300 wet-led pubs being sold by Mitchells & Butlers — Marston's had a "very clear plan" centred around opening up more food-led pubs.
Meanwhile, Marston's plans to increase the number of pubs run under a franchise-style retail agreement from 63 pubs to 600 within the next three years. Licensees earn 20% of turnover with average pub turnover around £3,500 per week.
From the start of July all lessees and new arrivals will be offered a full free-of-tie option. Findlay said he expected a very low take-up of the free-of-tie option.
The company is currently selling 60 bottom-end tenanted pubs. Pre-tax profits were up 0.4% to £27.8m on turnover of £309.2m, up 0.6%, in the 26 weeks to 3 April.