Luminar to continue with cheap drink promotions

Despite concerns over binge drinking, nightclub operator Luminar will continue selling cheap drink in venues where local competitors have already put in place discounting measures.

A spokesman for the group, which runs around 100 nightclubs across the UK, said drinks discounts would be available in some venues, but not across the whole of its estate.

"This will happen at specific locations where the local competition is already discounting. It is a protective measure," he said.

The group attracted heavy criticism from health campaigners last year when it announced it was proposing selling certain alcoholic drinks for 80p a pop.

At the time, Luminar's chief executive Stephen Thomas, said competition from supermarkets discounting their drinks had forced his hand: "We have a dilemma in trying to be responsible and trying to get people into our clubs."

Luminar today said it expected its full year results for the 12 months to February 26, 2009, to be in line with market expectations.

However the tough trading environment meant the numbers were likely to be at the lower end of analysts' forecasts, with profits expected to come in at around £20m on turnover of around £195m.

Promotional and pricing strategies were part of the focus to drive footfall and support turnover levels, the group said in a pre-close statement.

Gross margins for the year were down from 83.6 per cent in 2008 to 82.3 per cent in 2009, and group debt was £114m. Luminar said it had "significant banking headroom", thanks to a programme of capex reduction and suspension of the dividend last year.

Luminar added that the contraction of supply in the nightclub sector meant it was "well positioned to further strengthen its competitive standing".