Glass half-full: Why Fuller’s chief remains optimistic despite strikes leaving a £4m dent in Christmas sales
Pub chain Fuller’s lost £4m in sales due to the impact of strikes over Christmas and new year, as its chief warned of lower expectations for the full year.
Chiswick-based Fuller, Smith and Turner reported in the 43 weeks to January that like-for-like sales were up a fifth on the Covid-impacted previous year – despite a cocktail of consumer problems impacting the industry.
Both the energy and cost of living crisis have put pressure on suppliers of and customers’ demand, while strikes from rail workers have hit hospitality hard, with many city workers staying at home.
Fuller’s said in comparison to pre-pandemic levels, its like-for-like sales for 43 weeks to January were now at 97 per cent of the same period in the financial year for 2020.
Over Christmas and New Year, sales increased by 38 per cent against the previous year that was heavily impacted by Covid restrictions and work-from-home guidance.
However, the firm said due to the impact of strikes, its sales compared to pre-pandemic levels in December 2019 went down by five per cent, and since the start of October, the company estimates industrial action reduced its sales by £4m.
Fullers warned that the impact of losing £4m was its profitability was weakened and it expects to report earnings below expectations.
Simon Emeny, chief executive of Fuller’s said: “We are encouraged by our underlying sales performance.”
“While it is frustrating that the train strikes have set back our reported sales and earnings, it is reassuring that we are achieving our anticipated sales trajectory in periods unaffected by strikes.”
“While ongoing strike action will dampen sales, demand from customers remains good and we are optimistic that 2023 will deliver further sales growth through a busy calendar of events, and as office workers and tourists continue to return to the Capital.”
“We are operating in a high inflation environment, and that continues to impact our operating costs and margins. While some of these costs may be temporary in nature, others – such as the National Living Wage increase – are more permanent and we are focused on taking action to mitigate these costs wherever we can.
He continued that “although strike action and the cost-of-living crisis create short-term hurdles to our post-pandemic recovery, we remain confident in the resilience of the pub and the future opportunity for Fuller’s.”
“We are a long-term business, and we will continue to invest in our people”, adding that the company will “continue to support the development of our 200 apprentices and we look forward to the re-opening of The Admiralty in Trafalgar Square and The Sanctuary House in Westminster”, and other sites around the country.
Responding to the figures, UKHospitality Chief Executive Kate Nicholls, said: “Since the start of the strikes last summer, the cumulative impact on hospitality businesses, workers and customers has been unprecedented.
“These figures demonstrate the financial hit individual businesses are taking as a result of the dispute, which we estimate has cost the sector £2.5bn in lost revenue to date.
“The situation is entirely avoidable but provides yet another pressure for a sector contending with soaring energy costs, workforce challenges and dampening consumer confidence. With more action scheduled in February, it’s vital that all parties reach an agreement as soon as possible to prevent an even bigger hit to businesses at this increasingly challenging time.”
The RMT have been asked for comment.