Low prices here to stay, says Yates

Related tags Town centre pubs Weather According to jim 21st century Yates

It's official: price discounting on drinks is now normal practice at town centre pubs, according to Yates Group. Putting out a trading update, chief...

It's official: price discounting on drinks is now normal practice at town centre pubs, according to Yates Group.​ Putting out a trading update, chief executive Mark Jones said that trading Sunday to Thursday was "very competitive and very tough", leading to heavy discounting. "People need to have a reason to come out Sunday to Thursday and price plays an important part in that," he said. "Discounting is standard in the majority of town centre pubs on those nights."

Mr Jones (pictured)​ said some operators were still in denial: "We're sceptical of people who claim they're not discounting, as one or two of our quoted competitors have suggested, because the evidence we see suggests otherwise."

The Yates boss said he could not envisage any change to that scenario and said that consistently tough trading would lead to consolidation.

Yates joins Luminar and Wetherspoon in being left cold by hot weather.

Summer sales at Yates were down six per cent compared to last year because the hot weather saw customers stay away. Mr Jones said that 80 of the bars had late-night licenses and that "you're not going to dance the night away when it's 30°C".

The 80 refurbished Yates outlets saw like-for-likes increase by 1.7 per cent, while uninvested outlets are down 16.9 per cent. Mr Jones said: "Significantly, in the second-half of the financial year, as the proportion of uninvested branches continues to fall, their performance will have less impact on group results.

"However, there are a small number of residual sites which are unsuitable for the new 21st century Yates format and the return on investment is unsatisfactory."

Hinting strongly at disposals, Mr Jones said an update on plans for these branches will be given in Yates' results statement in November.

He added: "Internally the business is in good shape and the key to achieving full year results in line with our current expectations will be the strength of the trading environment over the coming months."

On a brighter note, like-for-like sales at Yates Group's second brand Ha! Ha! Bar & Canteen rose six per cent in the 12 months to September 28.

Analysts were unchanged, leaving profit forecasts for the year at £10.3m, up from £10m last year.

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