Punch Taverns on track to sell off 1,800 pubs

By Hamish Champ

- Last updated on GMT

Related tags Public house Inn Punch taverns

Punch Taverns said it is on track to sell around 1,800 non-core pubs as part of a disposal programme designed to slim down its leased operation from...

Punch Taverns said it is on track to sell around 1,800 non-core pubs as part of a disposal programme designed to slim down its leased operation from 6,800 sites to 5,000.

The UK's largest pubco, which has been selling off around 70 bottom-end pubs a month as well as packages of high-end sites to regional brewers over the past year, told a City conference hosted by stockbroker Numis Securities that it was halfway through its planned disposal programme.

The group also confirmed that its new code of practice was currently being assessed by the BII and would be published on or around April 22, when it announces its interim results.

Details of new lease agreements, likely to come into effect in the next financial year, will also be revealed around the time of its interims.

The group similarly plans to outline further developments in its previously-flagged 'Pathway to Partnership' programme, including reducing the ratio of business relationship managers (BRM) per pub from the current level of 55 to 40 in May, following detailed research into the role.

Punch also told the audience of institutional investors that across its managed pub operation it has upgraded most of its management "on every level".

Guest satisfaction across Punch's managed pubs was up from 50 per cent to 65 per cent "and improving".

Enterprise Inns, which was also presenting at the investors' shin-dig, highlighted average annual pub profitability in excess of £100,000, of which the company's share is £65,000.

The pubco said it planned to move its substantive estate from 83 per cent to 90 per cent of its pubs. "This should result from half the 1,271 non-core pubs being sold and half being turned round over the next two years," said Numis.

Midlands brewer Marston's meanwhile told the conference its various new tenancy deals "were working".

The 60 pubs on the Advance arrangement had seen volumes rise by five per cent; the 90 Marston's pubs on its Tracker deal saw average profits are up £6,000 a year, while the 40 pubs on the Retail deal saw average profits up £43,000 annually.

Also putting its financial case to City types was Suffolk brewer Greene King, which will next month host a major analyst visit to a number of its pubs.

The brewer chose to focus on its managed pub operation, said Numis, "for which progress in boosting like-for-like profits in calendar 2009 should not be [a] one off".

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