Enterprise cites ‘highly competitive' market amid modest sales growth

Pub giant Enterprise Inns has pointed to a "highly competitive" market as it unveiled modest increases in like-for-like growth and profit in 2015.

In its full year results for the 12 months to 30 September 2015, the company said that like-for-like net income growth was 0.8% for the full year, and 1% for the final quarter.

Profit before tax and exceptional items was up slightly from £121m in 2014 to £122m in 2015. However the company revealed a statutory loss after tax of £65m after exceptional charges of £162m, which related primarily to a revaluation of its estate, which was down 2.7%.

Enterprise is in the throes of trying to reshape its business, following what it calls its "strategic plan". It said that this strategy was on track, and that operational enhancements in its tied tenanted pubs had helped to reduce business failures by 18%.

It has also increased the number of managed houses it runs under its Bermondsey and Craft Union operations, from 16 at the time of its strategy announcement on 12 May 2015, to 25 at 30 September 2015. The firm pledged earlier this year to open 750-850 managed pubs in response to the government's plans to axe the beer tie.

Meanwhile, the business has also increased its portfolio of commercial properties from 185 sites at 12 May 2015 to 213 sites and has increased the average annualised rental income from £53,000 to £56,000.

Simon Townsend, chief executive, said: "We are pleased to report further operational progress and a second, successive full year of like-for-like growth in net income across our leased, tenanted and free-of-tie estate. This has been achieved by maintaining a relentless focus on the many operational activities and initiatives with which we are supporting our publicans to improve their profitability. Trading in the first six weeks of the new financial year has been in line with our expectations and continues to maintain our growth momentum.

"While the market in which our pubs operate remains highly competitive, and as we prepare for the implementation of new legislation in 2016, we are encouraged by the continuing momentum of our business, reflecting the exceptional efforts of our publicans and the strength of our relationships with them.

"The implementation of our strategic plan is on track, providing us with greater flexibility with which to optimise returns from each of our assets and deliver greater value to our shareholders. Our managed house estate is being successfully expanded and our commercial property portfolio continues to grow in both scale and quality in line with our plans."

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