Marston’s forecasts lower profit on food sales slump
Pub operator Marston’s said it expects to post a dip in profit this year due to weakening food sales.
Shares fell more than eight per cent after the Pitcher and Piano owner said it expected to report underlying profit before tax of around £101m, compared to £104m last year.
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Marston’s blamed the dip on slower growth at its food-led pubs, which only saw like-for-like sales growth of 0.1 per cent, due to weak consumer confidence and high levels of competition in the casual dining sector.
“It’s a tough market and one of the main reasons is because of the intense level of competition, but that might be beginning to ease due to high levels of business failure,” Marston’s chief executive Ralph Findlay told City PM
Alasdair Ronald, consultant at Brewin Dolphin, added: “Marston’s trading statement confirmed that the pubs focusing more on food are underperforming compared to those where the majority of the turnover is from drink sales – mainly due to oversupply in the casual dining sector.”
Marston’s announced it will accelerate it’s pub disposal programme from £40m to £70m this year following an increase in interest from buyers.
The pub chain also said it will invest in staff training and digital marketing next year.
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Group turnover was up three per cent to £1.2bn in the year to the end of 28 September, while total pub sales increased three per cent, including like-for-like sales growth of 0.8 per cent.
The group’s taverns business saw like-for-like sales growth of 1.9 per cent.Total volumes at the company’s brewing arm were up one per cent.