In revealing its audited results for the 52 weeks to 30 December 2018, The City Pub Group, operator of a predominantly freehold portfolio of 44 wet-led pubs in southern England and Wales, revealed that it had returned to profit having reported a £700,000 loss in 2017.
The company, which recorded a 22% increase in revenue to £45.7m – £8.3m higher than the previous year – also revealed like-for-like sales growth of 1.6%, as well as a 28% increase in adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) to £7.9m.
The company has also outlined plans to develop a new organisational structure to manage regional hubs while also strengthening both retail and head office operations.
Additionally, to incentivise, retain and recruit staff, the group’s Profit Share Scheme will be paid on a weekly, rather than annual basis, for all non-managerial team members.
Financial highlights
- Revenue up 22% to £45.7m from £37.4m in 2017
- Like-for-like sales growth of 1.6%
- Adjusted EBITDA up 28% to £7.9m
- Total dividend up 22% to 2.75p
- Pre-tax profit of £2.6m versus £200,000 loss in 2017
New £8.65m acquisition
During the course of 2018, The City Pub Group opened 11 new venues, developing and expanding clusters of sites in London, where it operates 20 trading sites as well as Cardiff, Brighton and Cambridge.
According to its latest statement, the company is on course to grow to between 65 and 70 sites by mid-2021 – with four new sites currently in development and the Pride of Paddington in London added to the group’s portfolio in February 2019.
Moreover, The City Pub Group has exchanged on the Hoste in Burnham Market, Norfolk – a 53-bedroom site with spa, cinema and gym that was named in the UK’s top 10 country hotel by The Guardian – for £8.65m as well as a new site in Bath, Somerset.
New openings in 2018
- Belle Vue, Clapham, London
- Bow Street Tavern, Covent Garden, London
- Tell Your Friends, Parsons Green, London
- Old Ticket Office, Cambridge, Cambridgeshire
- Pontcanna Inn, Cardiff
- Travellers Friend, Woodford Green, London
- Jam Tree, Clapham and Chelsea, London (two sister leasehold sites)
- Brighton Beach Club, Brighton, East Sussex
- Old Bicycle Shed, Oxford, Oxfordshire
- Chapel 1877, Cardiff
Plans to double estate size
Discussing the results, Clive Watson, executive chairman of The City Pub Group, commented: “Our strategic expansion has continued at pace with the opening of 11 new pubs in 2018 bringing the total to 44.
“Our performance has been driven by both organic growth and the new pubs coming on stream.
“Considering the continued strong performance we are delighted to increase our dividend, by 22% for shareholders.
“We continue to seek new sites to add to our portfolio and we have already earmarked six new pub openings for this year and are on course to meet our target of doubling the size of the estate to around 65 to 70 pubs by mid-2021.
“We believe the combination of further acquisitions, fine-tuning the management of our existing estate and the benefits of our new divisional structure will enhance our performance further.
“We are positioned to meet the number of well-trailed headwinds, not least the challenges brought through Brexit, and to take advantage of the softening market for acquisitions with our robust balance sheet and strong cash generation.”
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