Marston's annual sales drop by 22 per cent due to pandemic
Sales at Marston’s 1,500 pubs were down 22 per cent at £401.7 million in the year to October 2.
The Wolverhampton-based group, which employs 22,000, made a pre-tax loss of £171.1m but chief executive Andrew Andrea says: "Whilst still early days, Christmas bookings look encouraging and we look to the future with renewed optimism.”
Since the end of lockdown in July sales levels have been above that of pre-pandemic levels in 2019.
Full year sales have been impacted by significant disruptions from the pandemic, but there have been improving trading trends since reopening outdoors in April.
The group has also been helped by strong accommodation sales from the growth of staycations with people unable or reluctant to travel abroad. They were 38 per cent up on 2019.
Marston's has also strengthened its balance sheet through strong cash management during the pandemic wih its net debt reduced by £97m since 2020 to £1.23 billion.
The financial strategy is on track to reduce net debt to below £1bn by 2025.
The brewing business is now part of Carlsberg Marston's Brewing Company and the group has retained a 40 per cent stake currently at £277 million
Marston's is also now operating 107 SA Brain pubs in Wales on long-term arrangement.
The group has a Back to a Billion strategy to return sales to above £1bn by 2025 including a plan to reposition 290 food-led pubs to meet changing consumer dynamics.
Mr Andrea said: “It is extremely encouraging that trading momentum has built well since reopening and trading is now exceeding 2018-2019 levels. We were delighted to fully reopen our estate in July, once restrictions were lifted, and welcome our guests and team members back into our pubs.
"Whilst there are still some challenges to navigate over the months ahead, we believe the worst of the pandemic is now behind us and Marston’s has emerged a stronger, more focused business which is in great shape. Importantly, consumer demand for the pub and the role which this great British institution plays, at the heart of communities up and down the country, has never been stronger.
“Over the last 18 months, the Government provided much welcomed support to the hospitality industry, which has been so hard hit by the pandemic. We urge them to continue to assist the sector as it continues its recovery by maintaining VAT at 12.5 per cent.
“Marston’s enters the year ahead as a focused pub business with a clear strategic plan, a profitable and cash generative business, a strong balance sheet and a 40 per cent share in CMBC, our partnership with Carlsberg, which has such exciting potential. Our debt reduction plans remain on track and our well-invested, predominantly freehold, suburban pub estate is well placed to benefit from many of the positive consumer dynamics and drivers post pandemic."
