Marston’s has continued to defy widespread cost-of-living pressures with a resilient trading performance since the beginning of April.
Like-for-like revenues at the pub and hotel operator for the 16 weeks ending 22 July grew by 10.9 per cent on the same time last year.
The Wolverhampton-based company said in May trading had received a boost from the Easter weekend and the extra bank holiday in May to celebrate King Charles III’s coronation.
Recovery: Marston’s has rebounded strongly ever since lockdown restrictions that had forced hospitality venues in Britain to shut or subjected them to strict capacity limits were lifted
It subsequently benefited from patrons taking advantage of record June UK temperatures to enjoy a pint or some food in one of the chain’s outdoor garden spaces.
This helped total retail sales for the group’s managed and franchised pubs rise by 12 per cent for the first 42 weeks of the financial year, with a further boost provided by the absence of Covid-related restrictions.
The business has credited part of its recovery to substantial growth in hybrid working and the overwhelming majority of its sites being located in rural and suburban areas.
By contrast, rivals such Fuller’s are more dependent on trade in cities and large towns, meaning their recovery has been less straight forward amid evolving working patterns.
Andrew Andrea, chief executive of Marston’s, said: ‘Whilst macroeconomic challenges persist for the time being, we remain encouraged by the group’s trading resilience and that the pub remains an affordable treat for our guests.
‘An improving cost outlook, together with the actions we are taking to maximise efficiencies, leaves Marston’s well-placed to navigate through ongoing economic headwinds.’
Marston’s still faces a significant debt burden, which it expects to reduce by approximately £50million to £60million by the end of this year.
To help achieve its target of reducing net debts to under £1billion by 2026, it has not declared a dividend payment for the past three years and put dozens of ‘non-core’ sites up for sale in March.
Marston’s has more than 1,400 pubs across the UK, employing about 11,000 people, having effectively exited the brewery sector in 2020 after selling its beer business for £780million to a joint venture involving Carlsberg’s UK division.
Marston’s shares were 1.7 per cent higher at 32.4p on early Wednesday afternoon, although they have contracted by around 31 per cent in the past 12 months.
Analysts at Langton Capital said: ‘Would-be shareholders may be cautious in their approach to consumer stocks in general, but pubs, particularly those in residential areas, are resilient and sales there represent an affordable treat in the eye of most customers.’
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