Young's sees first half profits rise four per cent

By Hamish Champ

- Last updated on GMT

Related tags Cent Red stripe

Young & Co, the London-based pub operator, has announced half year sales up 0.7 per cent at £67.7m and pre-tax profits for the period up four...

Young & Co, the London-based pub operator, has announced half year sales up 0.7 per cent at £67.7m and pre-tax profits for the period up four per cent at £11.9m.

The group said adjusted earnings per share were up a fifth to 21.35p. Young's said it was increasing its interim dividend for the 14th consecutive year, raising the payout by two per cent to 6.36p.

Net debt for the group remained level at £62.6m, after investments in the pub estate of £8.2m.

Commenting on Young's' numbers for the six months to September 27, 2010, chief executive Stephen Goodyear the group had delivered a "resilient performance".

Its managed pub division saw turnover rise nearly one per cent to £60.3m, with like-for-like sales up 0.8 per cent, and operating profits, boosted by investments in the hotels business and what it called improvements in "wage control" up 2.7 per cent.

Food sales across the managed operation rose 1.5 per cent.

The profit picture across the group's tenanted pubs was less rosy, down 4.2 per cent due to £2.7m, "as we provided additional support to help our tenants meet the market challenges".

However Young's said that "in contrast with many of our peers, all our tenanted pubs are trading.

"At all times, our tenants benefit from the expertise of our business development team as together we seek to optimise each pub's prospects.

"Secure in the knowledge that we trade with one of the sector's highest earnings before interest, tax, depreciation, amortisation and rent (EBITDAR) figures per pub, £36,100 on a like-for-like basis for the six months, we remain committed to this approach."

Wells & Young's, the group's brewing venture with Bedford brewer Charles Wells, had seen turnover rise 1.5 per cent during the period. Young's has a 40 per cent stake in the operation.

Goodyear said the loss of the Corona Extra and Red Stripe management deals would not significantly impact Young's profits in the current year, adding "beyond that, we are confident that Wells & Young's management will respond in such a way so as to minimise any profit shortfall".

He added that the first seven weeks of the second half had seen managed pub sales up 3.4 per cent in total and up 1.8 per cent on a like-for-like basis.

"The extra burden on consumers over the coming months, with tax rises, job losses and the government's austerity programme gives us reason for some caution.

"However, we believe we are well-placed to build on this performance, aided by the quality and premium position of the Young's brand and our London presence and focus," he added.

Related topics Beer

Property of the week

Follow us

Pub Trade Guides

View more