Admiral Taverns 'unapologetically committed' to tied model

The company today reported that in the year to 30 May it had delivered absolute growth in turnover, operating profit and EBITDA for the first time in eight years.

Georgel told PMA sister title M&C the completion of the company’s turnaround strategy, leaving it with a core estate of 858, provided a base for further growth and that the company was in a perfect position to take advantage of large-scale disposals by rival pubcos.

During the financial year, Admiral grew both like-for-like income and EBITDA by 1.9%. Turnover rose 2.2% to £78.4m with operating profit up 82.4% to £24.9m and underlying EBITDA up 5.3% to £24.9m. EBITDA per pub was up 9%.

The group said like-for-like income for the 22 weeks to 31 October was up 1.8%.

Georgel told PMA sister title, M&C: “We see this as a watershed moment for the business. The confidence that has been built through turning the business around over the last six years can now translate into ambition for the future.

“We have a smaller group of sustainable pubs and we have real focus on our core competency at running them. The next stage is to identify other pubs that would fit that core focus. The acquisition of 111 pubs from Heineken last year shows we are an acquisitive business again and we will be active in trying to find pubs that fit that focus.”

On the possibility of picking up packages of pubs from other large pubcos, Georgel said: “We are very disciplined in reviewing portfolios and very clear about the sorts of pubs that fit our model and where we believe we can drive value. If those factors are met and the price is right then we have the confidence and the resources to grow the business again.

He said he remained “passionately committed to being the best operator of wet-led community pubs” and would look at the best way to achieve that.

He said: “We are always trying to optimise the returns from our pubs. In the vast majority of cases, even in the light of the impending legislation, we believe that will be achieved through commitment to the tenanted model. However, there may be a small number of sites where we may be better to pursue an alternative operating model and that is something we are looking at with a greater degree of commitment that we have done before.”

During the year the company extended its support to licensees through its new Business Support Agreement and its Advanced Business Development Programme.

Georgel said: “The market place has never been so competitive so we have to continually challenge ourselves on the support we are offering. We have looked at ways we can manage their cost base – we’re not just looking at how they can grow turnover. There are so many pressures for licensees – business rates are very prevalent – unreasonable, unfair burden on small businesses.

“We’re also helping them up their understanding on how to use social media.”

He said he hoped the National Living Wage would boost consumer confidence eventually and confirmed that Admiral was already factoring in the cost of NLW in rental reviews.