Greene King sees record-breaking Christmas Day - but slower sales overall in festive period
PUBLISHED: 09:11 25 January 2018 | UPDATED: 10:34 25 January 2018
Brewing and pub giant Greene King says it saw record sales on Christmas Day, but took a hit to trading in the weeks surrounding it.
The Bury St Edmunds-based group said like-for-like sales in its managed pubs rose 1.6% over the two weeks covering Christmas and New Year’s Eve – but predicted this would have been a 3.4% rise had December snows not caused disruption.
It hailed record-breaking trade on Christmas Day, with sales reaching £7.6m – up 2.6% on the previous year – with 154,000 meals sold.
But Greene King – which includes the Hungry Horse and Chef & Brewer brands – said sales either side of the festive season were slower, “reflecting the tough underlying trading environment and additional snow impact”.
Like-for-like sales fell 1.4% across its managed pubs in the first 37 weeks of its financial year, with food sales acting as the biggest drag.
Its leased pub chain posted a 0.2% rise in net profits over the period while its brewing arm saw sales by volume fall 0.9%, although this was against the background of a 3.0% fall in the overall ale market.
Greene King said: “Our additional investment to enhance the customer experience, including being more competitive on price, having more team members available at key trading times and strengthening local marketing activity, will help to improve our competitiveness and relative trading performance.”
It added: “We remain on track to deliver targeted cost savings of £40m-45m this year and our brand optimisation programme continues to deliver attractive returns of 25%. Both our new build and disposal programmes are also on track with six new sites opened and 40 disposals completed in the year-to-date.”
Greene King is a member of the EADT/EDP Top 100 list of Norfolk and Suffolk’s biggest companies by turnover.
Its update follows figures from rivals JD Wetherspoon, which yesterday warned that, while profits were ahead of expectations, “significant costs” would weigh on its performance over the remainder of the year, and Marston’s, which on Tuesday revealed a £1m hit to profits from the cold weather, although it added that, without this, like-for-like sales at its pubs would have been 1.1% up.
In November, Greene King has reported a fall in first-half revenues and operating profits amid “challenging” trading conditions for its managed pub estate.
Group turnover for the 24 weeks to October 15 dipped by 1.2% compared with the same period last year to £1.031bn.
Pub Company revenues, covering the group’s directly managed pubs and restaurants, declined by 2.2% to £837m while the figure for Pub Partners, the tenanted and leased pubs division, was 1.6% lower at £92.1m.
However, the group’s Brewing & Brands division saw revenues grow by 7.9% compared with last year’s first half to £102.3m, with its own beer volumes edging 0.3% higher against a 3.4% decline in the overall ale market.
Operating profits from the managed estate fell by 11.4% to £136.9m and those from tenanted and leased pubs dipped by 0.2% to £43.6m while the figure for the brewing operation was unchanged at £14.8m.
The group said at the time that it had committed additional investment “to enhance the customer experience, including being more competitive on price, having more team members available at key times and strengthening local marketing activity”.