Fuller's investment into estate eats into half-year profits

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Half-year results: Fuller's said investment in its estate was the right decision to ready its pubs for the busy winter (image: Mark Hillary, Flickr)

Fuller’s said an investment in its estate will ensure it is best placed for the Christmas period despite its half-year profits dipping as a result.

The pubco saw its sales rise 6% in the first half of its financial year thanks to a warm summer and World Cup fever.

Revenues rose to £222.1m, compared to £209.3m in the same period last year.

Like-for-like profit at its managed pubs increased 4.4% and at tenanted inns increased 2%. Its total beer and cider volume sales also increased by 0.5%.

However, adjusted profit before tax fell 1% to £23.6m, from £23.8m in 2017. Costs of £900,000 from investments in the pubco’s estate were put down as the cause of this drop.

Right decision

Chief executive Simon Emeny said: “Each division is delivering growth and we continue to benefit from having a well-balanced business.”

“While our revenues have continued to grow, we experienced a small drop in group profits – however, this should be taken in context.

“We made a conscious decision to front-load our investment programme – impacting our profitability by £0.9m.

“Although we would have seen profit increase had we not taken this action, we believe this is the right decision and ensures our estate is in the best possible position to benefit from the busy Christmas period and beyond.”

New sites

It opened a new pub in Surrey, added bedrooms to one of its Ealing pubs, and is set to open a site at Euston Station next month.

Emeny said he was pleased with the results: “Each division is delivering growth and we continue to benefit from having a well-balanced business.

“Our excellent management team has further strengthened the business through a clear vision, a strong set of values and a commitment to growth through offering an outstanding customer experience and recruiting, developing and retaining the best people.”

Emeny described the pubco as well-placed to handle Brexit, which is set to occur on the penultimate day of its financial year (30 March 2019).

“With a first-class team of people, a well-invested pub estate and a portfolio of outstanding brands, we are ready and able to face the future,” he said.