Pub group Marston's has announced it intends to accelerate its plans to cut its debt in the coming years.
The group issued a trading update for the 42 weeks to 20 July 2019, in which it declared its intent to accelerate the timescale originally announced in January, with plans to defer £70m of new-build investment planned for the next three years and reallocate £20-£30m of it into these plans, which are generating "significantly higher returns".
In the company's January trading update, it announced plans to reduce its net debt by £200m to £1.2b by 2023 through reduced capital expenditure, £120m of disposals and a reduction in interest and pension costs.
The group said the earnings impact will be "minimal" and "will generate an additional £40-£50m of cash flow over the next three years".
Ralph Findlay, chief executive, said: "We have achieved modest growth during the 42 weeks to date, continuing the long-term positive LFL sales trend despite May and June being hampered by relatively poor weather.
"Having made good progress with our cash generation and debt reduction plans, we have subsequently decided to accelerate our efforts in this context and defer our remaining new-build plans and reallocate £20-£30m of the £70m new-build capex over the next three years to drive higher returns from our existing estate. We believe that this focus will further enhance our returns from our existing pub business and reduce our debt at an even greater pace."
Like-for-like managed and franchised pub sales increased by 0.5%, destination and premium sales were 0.1% ahead of last year, and taverns sales were 1.1% ahead of last year, despite weaker sales in the last 16 weeks against last year's strong trading around the World Cup and unusually hot summer.
Marston's has an estate of around 1,500 managed, franchised and leased pubs across the UK.