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Greene King reports 22nd quarter of consecutive growth

30 April 2014 by
Greene King reports 22nd quarter of consecutive growth

Pubco and brewer Greene King has reported a 22nd quarter of consecutive like-for-like (LFL) growth, in a pre-close trading update for the 52 weeks to 27 April 2014.

Retail LFL sales were up 4.1% for the period, and 4.8% in the last 16 weeks, driven by strong performances over Valentine's Day, Mother's Day and Easter.

Greene King said it served a single day record of 262,000 food covers on Mother's Day, with LFL sales growth of 17.1%. Its Farmhouse Inns brand delivered a particularly strong performance with average sales per site of £14,400 and three sites delivering more than £16,000.

The hospitality operator saw sales growth of 5% for food and 6.8% for rooms.

The company said it expects to have added 45 new retail sites as part of its retail expansion programme, which remains on track. This will take the total number of retail sites to 1,032 sites, with Hungry Horse reaching 232 sites by the end of the year.

Average earnings before interest, taxes, depreciation, and amortization (EBITDA) per pub in Pub Partners were up 5.0%.

Greene King said its strategy to reduce the size of the Pub Partners' estate while improving its quality continues and it expects to end this financial year with 1,164 sites, 149 fewer than last year, after 134 disposals and 15 transfers to retail.

Brewing & Brands has again improved its market share, achieving core OBV growth of 4.6% against a UK ale market that is down 2.3%. This was driven by Old Speckled Hen, which saw growth of 12.5%.

Commenting on the results, Rooney Anand, chief executive officer, said: "This reflects the strengths of our business and the success of our strategy to move to higher growth areas in our markets and to improve the customer offer. We expect to meet the market's full year expectations for profit, cashflow and the balance sheet, with further improvement in our ROCE and a further reduction in leverage.

"Looking ahead, we see the UK's economic outlook improving. Throughout the downturn wage growth lagged inflation but this quarter has seen that change for the first time since the recession began, which bodes well for the future.

"Customers, though, are still spending carefully, as highlighted by our most recent Leisure Spend Tracker report*. Hence we remain cautiously optimistic for the forthcoming financial year."

Greene King's preliminary results for the 53 weeks to 4 May 2014 will be announced on 3 July 2014.

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