Young's hails landmark, transformational year of business as profits surge

By Peter Ruddick

- Last updated on GMT

Related tags: Geronimo inns, Hotel, Young

London-based pub operator Young's has reported a surge in pre-tax profits in a financial year it described as landmark and transformational
London-based pub operator Young's has reported a surge in pre-tax profits in a financial year it described as landmark and transformational
London-based pub operator Young's has declared the last financial year was a landmark and transformational twelve months for the business with pre-tax profits for the company surging nearly 18 per cent as it ceased brewing and fully integrated the Geronimo Inns business.

According to preliminary results for the company, in the 52 weeks to 2 April 2012 revenues grew by a massive 25.5 per cent meaning pre-tax profits jumped by 17.4 per cent to £21.3m.

In the twelve-month period like-for-like sales across its managed estate grew by 6 per cent representing an increase in operating profit of just over 20 per cent.

Transformational

"This has been a successful and transformational year for Young’s," Stephen Goodyear, the company chief executive declared as the business informed investors of its performance.

During the last year Young's pulled out of its brewing business by disposing of its 40 per cent stake in Wells & Young’s​ for £15.1m and fully integrated the 26-strong estate of Geronimo Inns which it paid £60m for in 2010.

"In the face of continued wider economic uncertainty, the group has delivered a strong set of results. The disposal of our stake in Wells & Young’s has allowed us to focus on our core, premium pub strategy and Geronimo Inns, acquired in December 2010, has been successfully integrated, with both Young’s and Geronimo’s operations benefitting from the best practice being shared across the combined business," Goodyear added.

Hotels

The Young's pubs strategy now focuses on premium sites in London and the south east - the Wandsworth-based firm said a high quality food offering was key to this but it would remain an operator of pubs not restaurants as 'they are a more consistent source of profits.' Like-for-like food sales in its managed estate grew by 7.2 per cent.

The hospitality operator also manages a number of hotels in London and the south. A year ago Young's revealed business across its hotels had achieved the biggest growth​ for the company.

Twelve months on and Young's announced it had been another strong year for the hotel business with occupancy and room rates increasing to deliver revenue per available room (RevPAR) growth of 10.7 per cent.

Dismal weather

Young's said it believed the traditional tenancy model would remain key to its strategy for its tenanted sites. During the year the company invested more than £1m in the tenanted side of the business and developed its tenancy agreement partnerships which offers tenants training on a range of skills including customer service, marketing and social media.

The company, which also announced it had reduced its debt even with investment of £24.2m in its managed estate, said it was optimistic for the next year despite a difficult trading period in the first month and a half.

"The start of the year has been affected by the generally dismal weather. Nevertheless sales for the first seven weeks were up 3.9 per cent, but down 2 per cent on a like-for-like basis. We are excited about the prospects that the Jubilee and Olympic summer will bring. Whilst the economy remains fragile, we believe that, with our focused and high-quality offering, we are well placed to continue to achieve growth," Goodyear concluded.

Related news

Show more

Spotlight

Follow us

Hospitality Guides

View more

Featured Suppliers

All suppliers