Hot summer fails to lift W&D and M&B profits

15 December 2003
Hot summer fails to lift W&D and M&B profits

Despite the hot summer and packed sporting calendar, continued tight competition in the pub sector meant that Wolverhampton & Dudley Breweries failed to lift profits this year.

Wolverhampton & Dudley (W&D), the UK's biggest regional brewer and owner of the Pitcher & Piano brand, said it would be looking to strengthen its portfolio with acquisitions during the next year. The group currently operates 477 managed pubs and 1,131 tenanted properties. The pub and brewer business warned that changes to the licensing laws in 2004 are likely to cost it about £1m in preparatory costs at its Pathfinder pubs division alone.

But pub company Mitchells & Butlers (M&B), the demerged pub estate of the now defunct Six Continents, gave the licensing law changes a cautious welcome and predicted a positive impact on future business.

W&D recorded pre-tax profits for the year ended 27 September of £73.1m, compared with £74m a year earlier. Turnover fell £15.1m year on year to £490.5m, in part due to the disposal of a number of underperforming properties.

The company also announced that its Marston's Pedigree had overtaken rival Bass in the last quarter to take number two position in the on-trade premium ale market.

Maiden turnover at M&B for the year ended 30 September was £1.51b, with profit before tax of £199m. Reaction from the City has been generally positive, with the company's share price on the up since the announcement.

However, insiders maintain it's still early days for the company, which will need to build on its performance.

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