In its latest trading report, the group said its pre-tax profits for the year were expected to be “slightly below market expectations” at between £9.1m and £9.2m – yet that is still up 15% on the same period last year.
The group identified a disappointing Rugby World Cup, poor weather in November and December, and industrial action affecting the rail network, as subduing trade.
Like-for-like sales were up by just 1.7%, which the pub group described as a result of a strong performance last year and several unfortunate one-off factors in the festive trading period at the end of last year.
The group revealed a total annual turnover of £59.8m for the 52-week period to 29 December 2019, marking a 31% increase on the previous year.
Tougher market
Although consumer confidence was affected by the general election in mid-December, 13 sites out of the group’s 47 broke sales records, the group’s executive said.
The City Pub Group executive chairman Clive Watson said: “It was a much tougher market in terms of the corporate spend, in particular. Where Christmas parties were being funded by the business, the corporate credit card was much more restrained this year.”
He added: “Given that we are flat against a good year last year, I think we actually did well.
“If we hadn't had an election, if we hadn't had all that awful rain, industrial action and all the rest of it, the turnout would have been very good.
“We worked a lot harder this year than previous years but it was against that political uncertainty, where people were holding back.”
Holding back
Watson was cautiously optimistic about the economic outlook following the general election, saying: “A lot of the uncertainty has been taken out and, therefore, I think that that will help.
“The overall economy has been flatlining for a while. I don't think a bounce would be the right word but there will be less concern about potential [political] outcomes; there's more certainty.
“The property market will recover and consumer confidence will recover but I don't think it's popping Champagne corks time.”
He added: “There will be more confidence but I don't think we are off to the races just yet.”
The group has three site openings earmarked for this year already, with a pub opening in Exeter in June and in Cambridge and Bath in September.
Watson said the group’s 2020 focus would be to invest in the group’s existing portfolio and ensure upcoming sites hit the ground running before taking a “prudent and selective” approach to further acquisition growth.