Spirit profits up as pubs outperform market
Spirit pub company has reported a 12% rise in pre-tax profits for the half year, as both its managed and leased divisions outperformed the market.
The business, which runs over 1,200 managed and leased pubs across the country, recorded pre-tax profits of £25m for the 28 weeks to 7 March 2015.
Meanwhile, EBITDA for the period was up 5% to £77m.
Total revenue from the managed estate, which is made up of nearly 800 pubs under brands such as Chef & Brewer, Fayre & Square, Taylor Walker and John Barras, was up 5% both as a result of like-for-like sales growth of 1.5%, and the benefit from the pubs it acquired from the Orchid estate in the second half of the prior year.
Like-for-like drinks sales in the managed estate were up 0.9% for the period, with like-for-like food sales up 2.8%, thanks to its strategy of converting its locals estate to its Flaming Grill and Golden Oak Inns formats.
Spirit's leased pubs saw like-for-like net income rise 2.3%, although turnover for the leased pubs was down 0.3% over the period.
Total EBITDA for the leased business was slightly up year-on-year at £17.4m, despite a 5% reduction in pub numbers, with average EBITDA per pub up 5% at £77,000.
Spirit, which was formed in 2011 after a demerger from Punch Taverns, is currently subject to a takeover bid by Greene King. Greene King's shareholders approved a £773.6m bid to take over Spirit back in January this year.
Spirit's shareholders also voted in favour of the deal in the same month, paving the way for the creation of a 3,127-strong pub company.
Speaking about the half-year results, Spirit chief executive Mike Tye said: "Over the past few years we have fundamentally transformed the business, and while the market remains highly competitive, we have continued to gain market share and see significant further opportunity ahead."
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