Capital Pub Company: London market remains strong
Capital Pub Company has reported sales growth of 22% for the 33 weeks to mid-November on last year as the London market remains "strong".
The 31-strong Capital Pub Company saw revenue increase 18% to £13.1m for the 26 weeks to 25 September with adjusted EBITDA also up 18% to £3.5m and adjusted pre-tax profits up 45% to £2m.
Capital has now fully refurbished its estate and boasts high operating margins due to its free of tie liquor led model. Wet sales account for 75% of total sales.
It said it had benefited from attracting good managers "who enjoy a high degree of autonomy" while its decision to run each pub as an unbranded local had given it an edge over branded chains.
Employees have recently been able to benefit from a Share Incentive Plan in the business, which has also helped increase loyalty among employees.
Acquisitions
In November, it exchanged contracts on the leasehold of the Goldsmith Tavern in New Cross, London, SE14 with completion due on 7 February 2011. The company has an option to acquire the freehold of the pub for £1.45m. The pub will be extensively refurbished and is due to open after Easter 2011.
Capital reported that sales at the Victoria Inn, Peckham Rye, SE15 (formerly the Wishing Well, acquired in November 2009) had increased five-fold since it opened in June, while occupancy in the 19 bedrooms is now above 50%.
Both pubs it acquired from Tomwahawk Pubs in August for £5m are trading at "anticipated levels" while the the Actress in East Dulwich (formerly The Uplands, acquired in January 2010) has seen trade increase "substantially".
Outstanding
"This is an outstanding performance which is the result of having a high quality, well maintained estate and incentivised and motivated pub management matching the retail offer to the local community," said chief executive Clive Watson.
"Over the last two years we have worked hard on the estate and made strategic acquisitions that have maintained the freehold integrity of our pub portfolio.
"The business is conservatively financed and is now in a position to self-finance further acquisitions using internally generated cash flow. Our aim remains to expand the Company to between 45 and 50 pubs by the end of 2013."
