The Lancashire-based company said profit before taxation for its 2023 financial year (FY23) ended 31 March 2023, was £15.1m (2022: £12.7m), while turnover increased by 13% to £108.8m (2022: £96.0m) and operating profit was 8% lower at £12.3m (2022: £13.3m).
Looking ahead, chair of Thwaites Rick Bailey, said: “It seems inflation should ease this coming year, energy prices are dropping fast in the spot markets and we are seeing evidence of a plateauing in food and other costs.
“We have opportunities to convert price decreases into our own cost prices and will work hard to grow our sales while delivering margin recovery this year.
“The factors that have shaken consumer confidence are going into reverse; for the moment recession has been avoided and employment numbers are strong.”
Good bookings for summer
Bailey continued: “Our properties are well invested and better staffed than they have been for some time and the corporate and short break domestic leisure markets are showing good bookings for the summer.
“We are seeing strong performances in some of our pubs and as a result we look to the coming year with cautious but increasing confidence.”
The turnover of its tenanted pubs increased year-on-year by 10%, with EBITDA (earnings before interest, taxation, depreciation and amortisation) and operating profit declining marginally in real terms.
Twaites said: “This performance was achieved despite significant disruption in the estate from closed pubs and pubs that needed to be re-let, which numbered between 20 and 25 pubs throughout the year, higher than our historic average.”
Meanwhile, turnover in its inns division increased by 11% on the previous year.
People rediscovering the pub
Beer volumes increased by 1% year-on-year with wines and spirits up by 4% and soft drinks 2% ahead. Thwaites said these results reflected an improving trend in the performance of the pubs as people rediscovered the pub over the year after the disruption in the previous two years.
Its gross margin improved by 2%, reflecting an ongoing and well-established move towards more premium, higher margin products across all categories. Machine income was a highlight with good growth in the year as a result of an ongoing movement to more attractive digital machines.
The business said its craft brewery goes from strength to strength. Customer feedback on its beers is “very positive, although the cask market has been challenged by changing habits”.
It added it is in the final stages of developing and launching a new craft keg range, which it believes “will support the future of our brewery”.
Thwaites said: “Cask beers have struggled to maintain their appeal over recent years as trends have shifted to world lagers and craft keg products. The ability to deliver a high-quality cask range will continue to underpin our beer range and brewery for the future.”