Revealing City Pub Group's interim results for the 26 weeks ended 30 June 2019, the operator of a predominately freehold estate of 47 wet-led pubs in London, southern England and Wales, revealed a 36% increase in revenue to £27.1m – up from £20m in 2018.
What’s more, the group recorded a 2.6% year-on-year increase in like-for-like sales alongside a 20% increase in adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) to £3.6m.
In addition, the company’s adjusted profit before tax was revealed to have risen by 19% from £1.6m to £1.9m over the same period.
According a results statement from City Pub Group issued on 19 September, this growth was mostly fuelled by an ongoing programme of strategic expansion which saw four new pubs open in 2019 including the Hoste in Burnham Market, Norfolk, which was subject of £8.65m investment from the pubco last year.
Rein in expansion
While the group’s sales performance over the 26-week period and beyond – it registered a sales increase of 35% over the last eleven weeks – has been attributed to an expanded estate of pubs, executive chairman Clive Watson revealed that the group will err on the side of caution regarding further expansion as long as uncertainty remains over the UK’s exit from the EU.
“Our targeted expansion of high-quality larger pubs with letting rooms has delivered strong progress for the group in the first half,” he explained.
“In the face of robust comparatives, we have delivered good like-for-like growth too. As our development sites begin trading during 2020, they will drive our performance onward. Our momentum has continued into the second half with strong sales growth.
“We cannot ignore the uncertainty in the market due primarily to Brexit and the potential impact of a no deal. We are a management team that is focused on the long-term and as such we believe it is prudent for us to rein in our expansion programme until there is more certainty.
“Instead we will focus on getting our development sites trading, developing our existing estate, reducing our debt and improving our dividends for shareholders. This will further strengthen our position and minimise the impact of any headwinds whilst continuing to deliver significant growth into the future.”