Football frenzies and financial strategy: five things to take away from Greene King's summer trading update
PUBLISHED: 08:27 07 September 2018 | UPDATED: 09:39 07 September 2018
Suffolk brewer Greene King says its sales were lifted over the summer by warm weather and the World Cup.
1. “Positive momentum” can carry you a long way. Greene King has been riding two waves of success this summer – from the months-long heatwave and England’s surprise run to the World Cup semi-finals. It points out “positive momentum” as a reason behind its 2.8% like-for-like increase in sales in the 18 weeks to September – and 3.2% comparable growth over the last 10 weeks.
2. Football fans are good for business. Over the seven matches Gareth Southgate’s side played in the World Cup Greene King’s pubs sold 3.7 million pints of beer, and like-for-like sales on the day of the team’s semi-final against Croatia were up 61%.
3. The brewer needed a strong summer. Greene King will be glad of strong sales after a recent slump in profits, which it put down to “unprecedented” cost rises. The firm is amid a cost mitigation programme which is helping to offset cost inflation of £45m to £50m, and it said it is making good progress with a refinancing programme to reduce the cost of debt.
4. Its own-brand pubs are performing best. Like-for-like sales in its branded local pubs were up by 5.5% in the 18-week period, driven largely by increased sales during the World Cup. Meanwhile like-for-like sales at its pub partners unit were down 0.4%, which the group blamed on continuing cost pressures.
5. The company is shrinking its pub estate. Greene King said it remains on track to dispose of between 100 and 110 pubs this year, while opening another nine outlets. It currently runs about 2,850 pubs, under its own name and brands like Old English Inns and Bellhaven.