'Brexit boredom' pushes Greene King sales, suggests CEO

29-Nov-2018 - Last updated on 29-Nov-2018 at 14:35 GMT

Brexit boredom: Greene King believes Brexit overkill could be a reason for rising sales

Pubco Greene King has seen an increase in sales over the past six months, a boost its chief executive attributed in part to heavy media coverage of Brexit.

Pre-tax profit for the Bury St Edmunds company increased 3.2% to £127.7m for the 24 weeks to 14 October while like-for-like sales across its chain of pubs rose by 2.7% in the period.

Christmas bookings are higher than they were at this point last year, and sales were up 2.9% in the six weeks since the half-year point.

“People are bored of Brexit and that’s actually translating to pubs benefiting, our like-for-like sales are up 2.9%, so not all consumer-facing businesses are suffering in the run-up to Brexit,” chief executive officer Rooney Anand told Reuters reporters.

Brexit benefit

He added: “Pubs are benefiting in some respects from every time we turn on the television, radio or read the newspaper, all you hear about is Brexit and it doesn’t really take you forward.”

The company is on track to limit its full year net cost inflation to £10-20m.

It disposed of a total of 40 pubs across its Pub Company and Pub Partners brands, which raised £30.3m, and generated a further £0.4m from the sale of unlicensed property.

Positive momentum

Chief executive officer Rooney Anand said the pub chain had seen continued positive momentum that had been “sustained beyond the boost of the World Cup and the summer weather”.

He said: “The hard work of our teams, combined with the investments we made to improve our customer experience, is driving sales outperformance to the market.

“We remain highly cash generative, meeting our debt repayment requirements, investing in our pubs and paying an attractive, sustainable dividend out of operating free cash flow.”

He continued: “Good progress was made refinancing the Spirit debenture, which will reduce the cost of our debt, and increase the strength and flexibility of our balance sheet.

“Looking forward, Christmas bookings are up on last year and we look forward to ensuring customers have a great time celebrating the festive season in our pubs.”

Consumer confidence

Uncertainty around Brexit “may impact on consumer confidence” but the group remains confident about the financial year, he added.

The group has identified "significant risks in relation to a potential 'no deal' Brexit" that could cause disruption to its supply chain and difficulties in retaining employees from the EU, according to its half-year financial results.

It had also noted potential issues with "increased administration on tax and customs as well as a tightening of the property markets affecting both acquisitions and disposals".

Anand will join an education charity next year, after 14 years working for Greene King.