The Bedford-based brewer and pub operator - which also revealed to M&C Report that it has secured its 11th pub in France - the Starfish in Bordeaux - said results for the 12 months to 28 September are ahead of forecast from last year’s AGM.
However, income fell £7.9m to £181.6m and pre-exceptional operating profit was £400k lower at £6.2m.
Brewing contracts
It cited loss of third-party brewing contracts and the Kestrel sale - Kestrel contributed sales of £8.7m in the previous year.
Adjusted EBITDA fell 20% to £13.9m and profit after tax was up 8%.<
Sales at Charles Wells Pub Company fell 3.5% as the size of the trading estate fell by 4.6% to 203 houses on average - 18 “smaller and unviable sites” were sold. EBIDTA per pub grew 3.4% in the year, when £3m was spent on refurbishments.
The company said its intention is to “purchase good pubs”.
John Bull managed estate
Net profit at its John Bull managed estate in France grew 13.5% with EBITDA close to breaking through the €1m mark. Gross profit growth at Cockburn & Campbell, its wines and spirits business, grew 12%. Turnover reached £17m. The company said wine volumes grew 6% in an on-trade wine market down 1%.
Growing sales
Chairman Paul Wells said: "We can report a year of steady progress with financial results being better than forecast at last year’s Annual General Meeting. Net profit before tax for the year grew slightly and overall trading has been better than expected, with good summer weather, new initiatives and new markets all key features in growing sales.
"Whilst exceptional items such as restructuring following the loss of brewing contracts and the sale of Kestrel have impacted on the headline figures, we have worked hard to mitigate these losses and have some further exciting new initiatives planned for 2014.
"Careful control of costs, including a 17% reduction in administration overheads by Charles Wells Pub Company, has helped protect our financial position and reduction of debt ensures we’re well positioned to grow the business.
Tax obligation
"Our tax obligation remains high, with the percentage of tax paid in relation to turnover rising to 44%. However, the cancellation of the duty escalator and cut in duty of 1p per pint helps to ensure that we will continue to invest in high quality pubs in the UK.
"Our brand portfolio includes an unrivalled mixture of traditional and imaginative beers and we look forward to strengthening our reputation by bringing interesting new beers to market in 2014.”
Recommended total dividend for the year remained unchanged at £3.30.