Hardys confident food will ease smoking ban

by The PMA Team

Nottingham-based brewer and retailer Hardys & Hansons has unveiled a 4.4% rise in like-for-like sales for its 79-strong managed estate.

The sales' rise helped operating profit climb 2% to £7m in the six months to 1 April. Averaged managed house turnover rose to £13,000 per week excluding VAT ­ food sales increased by 1% to 37% of managed turnover.

Chief executive Tim Bonham said strong food sales left the company well placed to withstand the proposed smoking ban in food pubs.

"I think a complete smoke ban is inevitable in time. I'm not happy with the split between food and non-food (proposed by the Government)."

He added that he thought that the BBPA's proposal to make 80% of trading areas non-smoking was "much more sensible". The company revealed that it was planning green field pub restaurant sites in Shrewsbury ­ opening around Christmas this year ­ and Worksop, which is set to open in June or July next year. Profits in 2006 would be further boosted by extensive refurbishments to five pub acquisitions in the north west and Yorkshire.

The pubs, which have 194 bedrooms, operate under the Premier Travel Inn franchise but will not contribute profit this year because of poor trading in the public house side of the businesses. Hardys is also trialing a number of tailor-made tenancy and lease agreement in its tenanted division.

The agreement, called a "Personal Letting Plan", aims to match licensees with individual business opportunities. Bonham said: "We used to have only prescriptive three-year tenancy agreements. We're now matching three to 21-year agreements to the individual involved."

So far, though, most tenants seem to prefer the traditional three-year agreement, said Bonham. Overall, the company's 183 tenanted pubs saw like-for-like turnover rise by 1%. Chairman James Kerr-Muir said: "Although trading conditions and the management of significantly increased costs remain challenging, the company's strong portfolio of freehold community and food-led pubs should prove resilient."

Overall, turnover increased 8% to £39.1m.