Punch sees sales rise as demerger takes shape
Pub landlord Punch Taverns has seen food and drink sales rise more than seven per cent in its Spirit division of managed venues in the past quarter.
In a bullish trading update, the branded pub and restaurant manager said sunny weather helped like-for-like food sales grow 8.4 per cent while drink sales rose 7.3 per cent.
And it said its plan to demerge the managed bars from the less profitable leased estate of pub venues to resolve its £3bn debt pile is making good progress.
However, it said Spirit’s finance director designate, Roddy Murray, had decided not to take up the position and it would fall to its current group business planning director Russell Margerrison to fill the role as interim finance director.
Punch, which owns or operates more than 6,500 pubs, added that it was on track to meet its full-year expectations, which currently include a pre-tax profit range of about £119.5m to £129.5m.
Shore Capital analyst Greg Johnson said sales had slowed slightly since the previous quarter when food and drink growth was 8.6 per cent, but this reflected both an ongoing refurbishment programme, in 160 of its venues so far this year.
Punch’s brands, which include Chef & Brewer, Fayre & Square and Flaming Grill, have performed better in recent years than its tenanted pubs, which are run by private landlords but have struggled in the recession.
Like-for-like net income in Punch’s tenanted estate fell 3.3 per cent, putting it on an improving trend, and looks likely to result in a flat income by the end of the year.
Average net income per pub over the ten months to the end of May was 1.3 per cent.
“Despite the challenging UK consumer environment we are on track to meet our full year expectations,” said Punch chief executive Ian Dyson.