pubs code

MRO quote plea from 24 Greene King licensees

By Michelle Perrett

- Last updated on GMT

Confident: Rooney Anand expects little impact to the group from MRO requests
Confident: Rooney Anand expects little impact to the group from MRO requests

Related tags: Greene king, Revenue, Uk

Greene King has revealed that 24 licensees requested a quote for the market rent-only option (MRO) in the first three months of the pubs code.

In its interim results for the 24 weeks until 16 October it said this number was in line with its expectations and added: “We remain of the view that MRO will not have a material impact on the group.”

The company also revealed that it had conducted a training scheme with its staff to ensure they had full knowledge of the details of the code.

It said: “We trained more than 100 team members to ensure we are as fully compliant with the statutory code as we were with the voluntary code.”

Its tenanted division Pub Partners saw net income up 4.2% for the period. Like-for-like volumes were slightly down but ahead of the UK beer market, while like-for-like rent was up. It said this was helped by continued capital investment and the growing number of turnover agreements in its estate.

Pub Partners operated 10.6% more pubs on average but achieved revenue growth of 14% and operating profit growth of 19.1%. Average earnings before interest, taxation, depreciation and amortisation (EBITDA) per pub was up 5.8% while like-for-like net income was up 4.2%. The company said this performance was helped by the short-term benefit of its non-core disposal strategy during the past few years and the one-off benefit of integration synergies.

Total revenue across the whole group reached £1.04bn, up 13.8%. Profit before tax and exceptional items was up 14.6% to £139m.

It’s Pub Company managed division grew like-for-like sales by 1.3%.

At the end of the half year, Greene King operated 3,029 pubs, restaurants and hotels across England, Wales and Scotland, of which 1,823 were retail pubs, restaurants and hotels, and 1,206 were tenanted, leased and franchised pubs.

Greene King chief executive officer Rooney Anand said: “We have delivered market outperformance and strong integration momentum against a backdrop of continued challenging market conditions.

"Our performance has been driven by growth in all divisions and the synergy benefits from the integration. These have helped to offset increased cost pressures, particularly from the national living wage, as well as additional investment in the customer offer to meet higher guest expectations of value, service and quality.

“The full impact of the UK decision to leave the EU remains unclear. Looking ahead, increasing levels of consumer uncertainty, further cost pressures and the changing dynamics of eating out, mean the consumer environment is likely to become more challenging.

"However, we are confident that the strength of our brands, pubs, people and cash generation leaves us well placed to deliver another year of progress, value creation and returns for our shareholders.”

Related topics: Greene King

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