Capital Pub Co founder steps down

Capital Pub Company (CPC) co-founder David Bruce is stepping down from his role as chief executive of the business to spend more time on his charitable and other ventures.

Bruce, who turns 60 next month, said he felt that he had helped take the AIM-listed pub group "as far as it can get".

Founded as an Enterprise Investment Scheme (EIS) in December 2000, CPC has effectively doubled in size during the last two years, acquiring six pubs last year.

But Bruce thinks it is time to move on. "This business needs a younger man in the hot seat and that man is Clive Watson," he said. The man behind the Firkin pub chain back in the 1980s will remain as a non-executive director of CPC.

Watson moves from chief operating officer to chief executive as the London-focused pub operator announced turnover for the year to March 29, 2008, up 32 per cent to £18.8m.

Operating profits rose by more than a quarter to £3.9m, while pre-tax profits fell 22 per cent to £800,000 after being hit by a non-cash accounting charge of £1.06m related to the fair value of interest rate swaps taken out against borrowings.

Underlying earnings per share rose 31 per cent to 7.99p, and the total dividend for the year rose five per cent to 3.15p per share.

Watson said the company's robust performance was down to a quality estate of pubs trading across the capital.

The new chief executive denied the 24-pub strong CPC paid too much for individual sites, having spent £13.1m on pubs during the year.

"We want quality sites and often accusations of overpayment are sour grapes. If you're building a quality estate you've got to pay the numbers," he said.

CPC sold three pubs to Young's during the year, with the sales being "close to book value", according to Watson.

Current trading was "resilient", and CPC was determined to double its turnover during the next three to four years, he added.

Meanwhile Capital Pub Company 2 (CPC2), another EIS, is set to go it alone after terminating its management agreement with CPC.

Bruce said CPC2, started in 2004 to get round the tax authorities' then-fund-raising limits, will have its own management team headed by former Scottish & Newcastle executive Kris Gumbrell.

CPC2's investment timetable will come to an end in March next year, at which point investors will decide on the options available to it, which include selling the business to the main company.