Fuller's posts 11 per cent profits rise

Fuller Smith & Turner, the London brewer and pub operator, has announced an 11 per cent rise in pre-tax profits for the six months to September 25, 2010.

In what chairman Michael Turner described as a "changing and challenging market", the group's 163 managed pubs saw like-for-like sales rise 3.3 per cent, with growth driven by accommodation and food - the latter up 4.2 per cent - with pre-exceptional operating profits up eight per cent to £10.3m.

The group said this momentum had been maintained into the second half, with like-for-like managed pub sales up 3.5 per cent for the 33 weeks to November 13.

Fuller's' 201 tenanted pubs saw a one per cent rise in like-for-like turnover in the first six months of the year, with pre-exceptional operating profits up two per cent to £5.1m.

Beer volumes rose one per cent, but own brewed volumes fell two per cent and what it called 'foreign beer' volumes, effectively lager, rose six per cent.

Fuller's said volumes to the free on-trade market slid 11 per cent, while off-trade volumes grew eight per cent and exports were up 25 per cent.

The brewer said its cost of borrowings would rise in the second half after it renegotiated its banking facility, but it added that it had reduced its net debt to below where it was in March last year when it acquired a number of managed pubs from Punch Taverns. The ratio of net debt to earnings before interest, tax, depreciation and amortisation (EBITDA) was now 2.1 times, it added.

Turner said that while trading conditions remained challenging, "we expect the spending cuts to impact the South of England less than other parts of the UK and we are confident that with our strong brands and high quality, well invested estate, we are well placed for further growth".

Results at a glance

Turnover: £121.5m (up four per cent)

Pre-tax profits (before exceptionals): £15.7m (up 11 per cent)

Earnings per share: £19.96p (up 11 per cent)

Dividend per share: 4.75p (up six per cent)