Pubs tied up in Notts: Hardys & Hansons

Hardys & Hansons expands its estate to over 250 and pushes up turnover to hit £42m.

There are a few pubs claiming to be the oldest in England, but it's generally agreed that the title belongs to Ye Olde Trip to Jerusalem in Nottingham.

Beer has been served there since 1189 and its ancient cellars contain a cock-fighting pit, although this has apparently not been used for some time.

The owner of the pub is Nottinghamshire's Hardys & Hansons, which dates back 169 years. With the disappearance of independent brewers such as Mansfield and Shipstone's over the past decade, it is the county's only remaining regional brewer.

It is also one of the few brewers still partly in the hands of the descendants of the founding family, and continues to brew cask ales at its historic base in Kimberley on the outskirts of Nottingham.

But, despite being soaked in heritage, Hardys & Hansons has begun shouting more loudly about its modern approach to retailing and production.

Managing director Tim Bonham believes the company was in the shadow of Mansfield, which was taken over by Wolverhampton & Dudley Breweries over a year ago.

It has had a full listing on the Stock Exchange for nearly 40 years and increased turnover to £42.4m last year, but its profile is smaller than similar companies such as Fuller's or Young's.

Last year, it spent £12m on buying Yates Group's Watling Street Inns, which expanded its pub estate to over 250 and took it into new areas such as Manchester. It has also begun building greater awareness among analysts and institutions in the City and has been investing in raising its profile through public relations.

"People are beginning to look at us, particularly because we are a profitable company and there are fewer regional brewers," Bonham said.

The acquisition of the food-led Watling Street Inns was part of a programme to improve catering in the managed estate, which is now made up of 82 pubs.

When Bonham arrived as retail director in 1990, food sales were virtually zero, but last year they hit £7m and account for 27 per cent of the sales split.

It has created two standard menus and supported the investment with a new catering team and modern technology, such as EPoS systems. This has been boosted by the Watling Street Inns, where food accounted for 20 per cent of sales. The eight pubs continue to be operated under a separate area manager, who is looking to drive food further.

While Hardys & Hansons has always looked for acquisitions, it invests heavily in new-builds. Shortly after arriving as retail director, Bonham was involved in creating the first of a new breed of food pubs.

It turned a farmhouse in Strelley, near Nottingham, into the Broad Oak with 46 covers, and followed this with a greenfield development in Sutton-in-Ashfield, Nottinghamshire. It has continued with this policy ever since, and last year spent £4.2m on acquisitions and new builds and another £2.9m on redevelopments.

Some sites, such as the new High Park in Bradley, Huddersfield, have play areas for children - another feature that is likely to be reproduced at new developments. This year will see £3.5m spent on two more major new builds at Etwall, five miles South East of Derby, and on the outskirts of Barnsley, South Yorkshire.

Although the Kimberley brewer has a presence in places like Manchester, Huddersfield and Burnley, Lancashire, and is looking for sites as far South as Northampton, it is still focused on Nottinghamshire and Derbyshire where it has 210 pubs.

Before buying the eight pubs from Yates, its most recent big deals were 40 pubs from Bass and 10 from Whitbread in 1991.

"Acquisition is key to our strategy to be able to roll out big pubs," Bonham said. "We need to be in a position where we are building a quality managed house estate and can drop pubs off the bottom over time, inevitably by transferring to tenancy or selling them.

"But we have never got into the numbers game here. It doesn't matter if we have 250 pubs or 500 - what is important is the quality and sustainability.

"In three or four years' time, we will probably still be talking about the same number of houses, but the quality will be better."

While the Watling Street Inns package included three leaseholds and the city centre bar Courtneys off Deansgate, Manchester, Bonham has avoided getting into high street leases.

He knows about the pitfalls of this market from his past career at Grand Metropolitan and then Whitbread, where he was involved in setting up a new chain of wine bars in the late 1980s - just before the economy went into freefall.

"With the increasing number of licences in the high street and rising rents, all you need is a recession, and I wouldn't want to be in one of those leaseholders' shoes," Bonham said.

The next step is to focus on the 170-strong tenanted estate, which is generally pubs in villages and rural areas run under traditional three-year agreements.

"Our tenanted trade is good but we've spent a lot of time and effort on our managed estate and our tenanted estate hasn't had the focus that it should have had," Bonham said.

Hardys & Hansons is one of the brewers that are seeing rising ale volumes in a declining market, with its ales available from The Beer Seller and stocked in some JD Wetherspoon and Hogshead pubs.

Sales have been boosted through focused in-pub promotions, under marketing manager Alan Shepherd.

Last year, Hardys made the high-profile appointment of a new production director, Iain Masson, who had looked after Abbot Ale, Old Speckled Hen and Ruddles as head brewer of Greene King.

Last year, Hardys & Hansons launched its nitrokeg mild Kimberley Dark, which added to its premium ale Kimberley Classic and its session ale, Best Bitter. It also has its own nitrokeg, Kimberley Cool, and a range of seasonal ales.

"I don't get hung up on whether we are a cask ale brewer or a nitrokeg brewer," Bonham said. "We are flexible enough to produce the beer that customers want to drink. If there's a downturn in one area, we can respond to that.

"It doesn't do our image any harm by being progressive so long as we keep sight of our values - being close to our consumers and maintaining quality."

Despite the arrival of new senior staff from retailers such as Tom Cobleigh, the brewer still has strong links with its past. Chairman Richard Hanson is the great-grandson of the founder of Hansons Brewery and other descendants Nick Forman-Hardy and Patrick Helps are non-executive directors.

While City institutions such as Britannic and Tweedie Brown own significant stakes, 50 per cent of voting shares remain in hands of the family, removing much of the risk of takeover facing other listed brewers.

"We believe there's still a strong case for being vertically integrated, and we intend to stay that way," Bonham said.

"We are a far cry from the image of a sleepy regional. We have some of the best values of a regional brewer, but some of the best computer and retailing skills of any company."

Address:​ Kimberley Brewery, Nottingham, NG16 2NSTel:​ 0115 938 3611No of pubs:​ 82 mgd, 170 tensPre-tax profit (1999/2000):​ £9.01m