Fullers gives the pub sector some Pride as results cheer investors
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Your support makes all the difference.Fuller Smith & Turner proved that there is still life in pubs if you run them properly, growing sales and profits despite the gloom that still hangs around some of the trade.
The family controlled company – which has 350 pubs in the South of England and is famed for its London Pride and other real ales – benefited from more people coming to eat and sleep in its pubs and also said it expected to enjoy a sales boost from next year's Royal Wedding and the Olympics in 2012.
Chairman Michael Turner said that while Government cutbacks were a concern, they would likely hit Fuller's southern heartland less than other parts of the country which are more reliant on the public sector.
The Chiswick-based company reported an 11 per cent rise in profit to £16.8m for the six months to 25 September on turnover of £121.5m, up 4 per cent. Sales, excluding new openings, grew 3.3 per cent at managed pubs and hotels and 1 per cent at tenanted inns. Beer volumes were up 1 per cent, although Fuller's own beer actually fell 2 per cent with the gap being made up by foreign brews, chiefly lagers. At 4.75p the dividend is up 6 per cent.
The company cut its net debt from £107.7m to £93.6m and consequently finance costs fell 17 per cent to £2.4m. Debt levels have been a major problem for rivals, some of which have been preoccupied with reducing the burden of excessive borrowing at the expense of their front-of-house offerings.
Mr Turner said: "We've been helped by having a long-term focus, making sure we have a quality offering and continuing to invest in it. We do benefit from being family controlled because it means we can look to the long term. We don't really want people telling us what we should be doing. We have had conflicting advice down the years and most of it has proved to be wrong. Those who disagree with us can always go and invest somewhere else."
Mr Turner also renewed his criticism of supermarket discounting and called for the Government to put beer under the same duty regime as cider.
"Pubs keep control of drinking," he said. "If there are premises where excessive drinking is encouraged the police have all the powers they need to go in and close them down. In fact, we wish they would do so more often. We do operate under a heavy burden of tax, effectively 50p on a pint of Pride."
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