Fuller's hails 'exceptional' performance of tenanted pubs

Fuller's has hailed the exceptional performance of its tenanted pubs despite a 1% drop in like-for-like profits.

The London brewer and operator said it believed the division had outperformed the market in a "difficult environment".

Revenues were marginally higher than last year at £26.1m from £26m, reflecting a growth in beer volumes but rental income had reduced in line with inflation.

Operating profits before excepetionals was £9.9m — 3% down on last year with the lower rent take a key factor.

Fuller's declined to reveal the average tenant profit in the estate. Fuller's Inns managing director Simon Emeny said it had never been its policy to reveal tenant profits but said the company realised it was "absolutely essential" that tenants were making a good profit.

Chairman Michael Turner added: "In the last three years, we have filled 53 permanent vacancies in our tenanted business. Of these appointments 46 remain in place today. We are succeeding in finding the right partners with whom we are able to build a successful relationship."

Turner said it took a sensible approach to rent reviews. "We understand that on occasion rents need to be reviewed," he said.

"We are aware of this because we ourselves are obligated under a small number of leases where, as tenants, we are obliged to pay rents which are not sustainable.

"These are property issues though, not issues confined to the pubs sector and the Beer Tie. We seek to ensure that each pub has the right level of rent and we will adjust the rent when we believe it does not.

"Where a business is failing, we believe that the underlying problems need to be addressed. Key issues such as beer duty and supermarket pricing are outside of our control and affect the whole industry. These issues cannot be resolved by rent concessions."

It has recently had its code of practice accredited by the BII.