Findlay: Food will drive new managed houses

Marston's is pushing ahead with growing food sales from the expansion of its new-build pub-restaurants, which the company will grow beyond the stated 60 scheduled to open over the next three years.

Six of the units are already trading and Marston's confirmed another nine will be up and running by the end of 2010 as it unveiled strong first half trading for the 26 weeks to April 3.

Ralph Findlay, chief executive of Marston's, said: "We see good opportunities from them and our three-year plan is for 60. And then there will be more."

The decision to focus on new-builds is the ability to configure them with sizeable kitchens, suitable gardens, and have the capability to generate sales of £20,000 per week. This is driven mainly by food, which accounts for 60 per cent of total retail sales compared with 39 per cent in Marston's other managed outlets.

Findlay also stated that the move towards food has helped drive sales of premium ales (with an ABV above four per cent), which delivered four per cent growth in the first half compared with a flat year-on-year performance from standard ales.

"As we compete more with restaurants we attract new people who eat more and are interested more in quality drinks so the premium end benefits. They have stronger beers as they are drinking less of them - one or two pints with their food. The use of pubs for session drinking is less," he said.

Findlay expects food sales to "do all right" over the World Cup and contribute to predicted additional revenues of £250,000 across the managed estate of 490-plus pubs during each of the England matches.

The impact is likely to be even more positive for the group's tenanted and leased estate: "The upside will be greater as they are more wet-led and the lager brewers will be promoting. We're optimistic that it will be a good second half."

This will follow an improved performance in the first half, with like-for-like profits down by 4.6 per cent, but this bettered the 4.9 per cent fall in the first 16 weeks of the year.

Findlay said Marston's continues to benefit from its aggressive sale of units before 2007 that did not fit into its food-led strategy and that there will therefore only likely be 100 pubs sold over the next two to three years. "There will be a modest increase in pub numbers as we've a good quality estate and do not need to sell," he added.