Marston's sales up - but living wage has impact

Marston’s has reported like-for-like sales in its managed houses up 1.7% for the 41 weeks to 18 July and 2% in the last 10 weeks of that period.

The year to date growth includes a rise of 1.6% in both wet and dry sales. Operating margin is slightly above last year and the company said it is on track to complete 25 new-builds in the financial year.

Like-for-like sales in its Taverns estate were up 1.7% for the year to date and 2% in the last 10 weeks. The company said its now 550-strong franchise business continues to perform strongly .

In the Leased estate, profits for the 41 week period are estimated to be in line with last year. Average profit per pub was up 4%, which the company said reflected a higher quality leased estate.

In Brewing, own-brewed beer volumes, excluding Thwaites, were up around 4% year-on-year. Including Thwaites, own-brewed beer volumes rose 10%.

Marston’s said the introduction of a National Living Wage mean “wage costs will be modestly greater than we had expected, but the impact compared to our plans is mitigated by the fact that we had anticipated increases above the rate of inflation, and the lower rate of corporation tax from 2017”.

The company added: “Our view remains that Government should prioritise taxation and business rate reductions to reduce the cost of doing business and increase consumer confidence.”

Chief executive Ralph Findlay said: “Our investment in new-build pub-restaurants and premium pubs is in line with our plans and we have seen some of our most successful openings to date this year. We have also opened three lodges, and expect this rate of development to increase in 2016. We have good visibility over our site pipeline and remain focused on securing further good sites for our future growth. These investments, together with the disposal of smaller wet-led pubs and the growth of franchises, have successfully transformed our business over the last three years.

“In brewing, the post-acquisition integration of Thwaites’ brewing business is now complete and has gone well. Our strategy is well-suited to leveraging market growth in local, premium and craft beers, and the increasing importance of the off-trade.”