In its half year results to 30 June 2020, Adnams, which operates an estate of both managed and tenanted pubs across Suffolk, revealed a pre-tax loss of £3.5m for the period, compared to a loss of £800,000 in 2019.
What’s more, earnings before interest, taxation, depreciation and amortisation (EBITDA) was down by £1.6m compared to a profit of £1m in 2019 while turnover for the first six months was £21m, down from to £34.7m in 2019.
In light of the ongoing pandemic, Adnams has cancelled its final dividend for 2019 and no interim dividend is proposed for 2020.
The brewer and operator was one of the first pub companies to cancel rent for its tenants amid the coronavirus crisis, informing its tenants across Suffolk that they would not be charged from 17 March onwards.
Beer sales diluted
The Government’s decision to call last orders in pubs on 20 March, and the enforced 105-day closure that ensued, were also revealed to have had a “serious impact” on the Ghost Ship brewer’s drinks sales during the first six months of 2020.
At the end of February, Adnams’ beer sales volumes were tracking at just under 3% down on year-on-year but tumbled to 24% behind in April with on-trade business restricted to small deliveries to pubs running takeaway operations.
However, the brewer and operator saw strong growth in its take home sales, which increased by 25% versus the same period in 2019, despite overall beer volumes falling by 25%.
The company’s online sales represented a “true highlight” during the difficult period, however, with sales increasing four-fold versus 2019.
Focus on resilience and recovery
As of 30 June, Adnams’ bank debt stood at £14m – a £7m improvement on its June 2019 figure of £21m, which the operator attributed to cost and working capital management on top of deferring various taxes and duties where possible.
Control of cash and restricted spending have also ensured that Adnams banking facilities remain at £22m, with £10m comprising term loans whose maturity have been extended.
Discussing the operators’ latest results statement, Adnams chairman Jonathan Adnams said: “Our diversified strategy has enabled the business to pivot and adapt to the changing environment quickly.
“Through controlling costs, maximising opportunities, and delivering operational excellence at pace has ensured that we have continued to grow the parts of the business that could operate.
“Our focus on resilience, recovery and doing the right thing has continued to grow our social capital with our incredible team, customers and others.
“As we approach the Adnams’ 150th anniversary in 2022 we can look forward to building back better.”