Like-for-like sales in the Destination and Premium arm grew 5.7%, with operating profit in the division up 18.2%. In the Taverns estate, managed and franchised like-for-like sales were up 3.8% and the core estate was in profit growth, while like-for-like profit in the leased arm were up 3%.
Brewing revenue increased by 3.5%, with operating profits up 4%.
Marston’s increased its dividend by 4.3% to 2.4p per share as revenue in the period grew 4.5% to £374.3m. Underlying earnings per share were up 10.8% to 4.1p.
Operating margin was 1% below last year “mainly due to the continuing planned conversion of former tenanted pubs to our successful franchise model, generating increased profit at a lower operating margin”.
The company said it’s on target for at least 27 new pubs this financial year. It converted 65 pubs to franchise in H1. During the period it disposed of 286 pubs and similar properties, generating proceeds of £115.7m, including the portfolio disposal of 202 pubs for £90m announced in November 2013.
Net debt at the period end was £1,190m (2013: £1,194m). “This includes £155m of structured long-term lease financing which has the characteristics of property leasing whilst retaining the benefit of freehold ownership.”
Ralph Findlay, chief executive, said: “The first half year was good and current trading is strong. We are creating a higher quality pub estate which is delivering positive trading momentum and meets the expectations of today’s customers. We opened 11 new pub-restaurants in the first half and remain on track to open at least 27 in total this year. Our 100th new pub built since 2009 will open this summer, with 5,000 jobs having been created.
“We are beginning to see some evidence of consumer confidence returning in the regions, leaving us confident of making positive progress for the remainder of the year.”
For a closer look at the results see the Publican's Morning Advertiser sister site M&C Report.