SA Brain raises pre-tax profit on reduced turnover
Welsh brewer and pub operator SA Brain has seen pre-tax profit rise 77.1% to £10.4m for 2009 thanks to the sale of its drinks distribution business to Heineken UK.
But operating profits and turnover at the company fell because the company is no longer wholesaling third party products to free trade accounts.
Operating profit was down by 36% to £4.7m, while turnover dropped by 9% to £103m.
Scott Waddington, chief executive of the firm which has around 250 and is best-known for brewing Brains Bitter said: "The sale of the free trade business has enabled us to fully focus on and invest in our brewing and pubs business whilst making our beer brands more widely available through Heineken UK's comprehensive distribution network."
Waddington added that both Brains' managed and its tenanted/leased divisions felt the effects of a downturn in consumer spending and continuing cost pressures. But its managed houses did see a rise in food and accommodation sales.
Beer volumes also improved by 1.2% in a market that SA Brain estimates is 6.4% down on a national basis. Its cask ale volumes grew by 6% compared to the national market for cask which was around 1.7% down.
But Waddington warned: "It was difficult to grow income in the underlying business whilst again having to absorb a number of increased costs that we could do little to control. Nevertheless it should be noted that overall we have continued to outperform the market in several areas of the business and at least perform in line with the market in others.
"The recent 5% increase in beer duty on top of the 20% increase experienced over the past 2 years is unhelpful to the brewing and pubs industry and will put further jobs at risk across the sector. While we remain cautious about the trading conditions that we expect to experience in 2010, we remain committed to giving our customers good reasons to visit our pubs and drink our beers."
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By Neil Gerrard
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