The Midlands-based business reported like-for-like (lfl) sales for the 42-week period to 22 July 2023 were up 10.7% versus the same period in 2022. It added both drink sales and food sales have been strong, demonstrating the steadfast trading resilience of its predominantly community pub estate.
Lfl sales in the 16 weeks to 22 July 2023 were up 10.9%, which reflected the warmer weather in June that enabled the company to maximise the return on investment in its outdoor trading areas undertaken ahead of summer.
Meanwhile, total retail sales in the group’s managed and franchised pubs for the 42-week period were up 12.0% on last year.
Good customer demand
Marston’s said: “The level of customer demand continues to be good, demonstrating that the positive experiences our guests have in our pubs is important and continues to drive demand.”
The group added it trialled rolling out a franchise-style model in 13 of its food-led managed pubs to complement the 717 wet-led pubs currently operated under this model and said it was “very pleased with the result of the trial, with sales growth exceeding our broader food business. As a consequence, we expect to grow the number of food-led partnerships to over 50 pubs in FY24”.
Reducing net debt, excluding IFRS 16 lease liabilities, to below £1bn continues to be a key focus for the group and progress is in line with expectations. It anticipates net debt will have reduced by £50m to £60m at the end of FY23 and predicts the same level of debt reduction in FY24.
Marston’s chief executive Andrew Andrea said: “Marston’s has delivered another strong trading performance, validating the strategy we are implementing and demonstrating the appeal of our pubs.”
Encouraged by food franchise trial
Andrew continued: “We are making good progress and are beginning to see the benefits of the actions we have taken in H1, simplifying our trading formats and repositioning our pub portfolio, as well as the investments we have made in our pub gardens and outside trading areas.
“In addition, we are encouraged by the success of the trial extending the partnership model into our food-led pubs. The trial has been positive and we will extend this model to over 50 food-led pubs in FY24. Marston’s pioneered the operator managed agreement in 2009, which now operates in over 700 wet-led pubs, and we are pleased to lead the evolution of this format and are excited about its future growth potential for our business.
“We remain focused on delivering on our debt reduction strategy and continue to make good progress in that regard. Whilst macro-economic challenges persist for the time being, we remain encouraged by the group’s trading resilience and that the pub remains an affordable treat for our guests.
“An improving cost outlook, together with the actions we are taking to maximise efficiencies, leaves Marston’s well-placed to navigate through ongoing economic headwinds”.