Statutory code: Beer flow company Vianet 'to challenge' proposals

Vianet, the beer flow monitoring and data management company, says it would challenge proposals for a statutory pubco code “as forcibly as necessary” and warned of the “detrimental” effect of the plan on its business.

It came as the group reported a 7% fall in revenue in its leisure arm in the year to 31 March, largely due to “exiting lower margin compliance cellar inspection activity” in the period. Overall pre-tax profits fell from £2.3m to £1.8m on revenue down from £23m to £21.1m. Recurring revenues remained steady at 71% (2012: 70%) and gross margin was stable at 51% (2012: 53%).

The company said it had several major contract extensions in the year, including the introduction of its iDraught system with customers including Enterprise Inns, Punch Taverns, and Marston’s.

Vianet warned that uncertainty around the proposed statutory code for pub companies may lead to delays in orders for its products; the consultation includes provisions for controlling the application of beer flow monitoring for managing compliance with the beer tie.

Vianet said: “The group believes these proposals are unjust and that they are not based upon fact or any substantiated evidence. As such the board intends to formally respond to the Secretary of State [Vince Cable] to reject the proposals regarding beer flow monitoring and to support the continued legal use of beer monitoring products and services.”

The group said its service has been “subject to legal scrutiny by the court of law on many occasions and has never been shown to be unfit for purpose”. “Accordingly as a board, we are extremely disappointed and frustrated by the proposals contained within the consultation document.”

The firm said implementation of the code would “likely have a detrimental effect on the company’s business” and therefore the board is prepared to challenge these proposals “as forcibly as necessary to prevent them being enacted into legislation”.

"It is somewhat ironic that the measures proposed by the government will reduce transparency in the landlord - lessee relationship, increase the risk to HMRC tax revenues, and undermine beer quality for drinkers.

"The board looks forward to the Government exercising proper due diligence and reviewing the facts and evidence in this consultation and anticipates that if it does so, the proposals will be amended satisfactorily."