Enterprise Inns reports 1% LFL income rise per pub

The company, which this morning also announced that former WH Smith chairman Robert Walker is to succeed Hubert Reid as chairman, said like-for-like net income per pub was down 2% across its entire estate.

Average net income per pub increased 5% (2010/2011: 1%), helped by improvements in operating performance and the disposal of underperforming pubs, Enterprise said.

The firm said there had been a reduced level of business failures and overdue balances, and a “substantial reduction” in the cost of financial support for publicans.

Net income uplifts among its 110 pubs that have traded under the Beacon pubs managed tenancy model for at least four weeks were “close to 30%”. Enterprise plans to have 150 sites operating under the format by 31 March, and 300 by the year-end.

Enterprise said it had identified for sale a number of “exceptional” properties that can realise substantial cash proceeds above book value. “We expect to complete a number of such sales during the next two years.”

So far this financial year, Enterprise has completed the sale of 63 pubs for £40m, a profit of £2m over book value. It has also exchanged contracts on a further 33 pubs (net proceeds of £33m) for completion this financial year, including the 15 pubs that are to be sold to Fuller’s for £22.9m.

Enterprise said it expected trading conditions to “remain challenging throughout the coming year as consumers face economic uncertainty and publicans have to manage rising cost pressures”.

Meanwhile, the company called on the “highly damaging” alcohol duty escalator to be dropped and called for “further steps” to reduce discourage supermarket to sell alcohol at “irresponsibly low prices”.