London brewer and retailer Fuller's has joined the growing clamour over progressive beer duty and the way it is distorting the cask ale market.
Managing director Michael Turner has claimed that progressive beer duty, which provides tax breaks for smaller brewers, simply wasn't thought through prop-
erly, giving over-generous help to smaller brewers with subsidies not pitched at a "sensible level".
"It's certainly distorting the market," he said. "It does make life harder for us although it's not critical to our future. There's no doubt smaller brewers are giving away (PBD savings) in discounts. I don't think it was thought through properly or introduced properly by the Government."
His comments came as Fuller's - which has applied to join the Society of Independent Brewers - revealed that its own cask-ale production was static at around 198,000 barrels last year although total sales were up 3% to 285,000 barrels.
The company did well to maintain its own volumes after the loss of a unnamed pub company customer who was re-tied after a takeover. The lost barrelage was replaced with new on and off-trade listings.
Its key brand, London Pride, won market share and a new beer Discovery Blond Beer, launched in May 2005, did "exceptionally well" by attracting lager drinkers thanks to being served cooler than traditional ales.
Fuller's also completed a £2.1m investment in its kegging line that has allowed the company to accommodate increased production after its Gale's acquisition in December last year.
Elsewhere Fuller's posted strong profit growth in its managed and tenanted division. Man-
aged pubs delivered a 13% in-
crease in food sales accompanied by an 8% surge in cask ale sales.
"For some time, Simon Emeny, our retail director, has been focusing on outstanding cask beer, great food and exemplary service," said Turner.
He admitted that the company was looking at some of the Spirit gastropubs in London being sold by Punch at the moment, but insisted Fuller's would not over-pay. Sales rose in the 52 weeks to 1 April by 12% to £145.1m, with adjusted profit before tax up 5% to £18.7m.