Fuller’s reports profit growth despite ‘most volatile’ start to a year ever

In the 52 weeks to 31 March Fuller, Smith & Turner reported revenue growth of 5 per cent which contributed to a rise in adjusted pre-tax profits in the period to more than £30m.

All divisions of the business reported growth in the last year - the Fuller’s managed pubs and hotels continued to deliver strong like-for-like sales growth of 4.2 per cent. Profits in the tenanted inns part of the business jumped 4 per cent while profits also rose slightly for the beer company which brews beers, including London Pride, from its Chiswick brewery.

Acquisitions​

“I am pleased to announce a very positive performance in a year where we have laid strong foundations for future growth following capital investment of £75m across the business, which included the acquisition of 30 carefully selected pubs,” Michael Turner, the chairman of Fuller’s, said in a statement revealing the company performance in the last year.

Fuller’s has recently acquired a number of pubs mainly in London and the South East including 15 former Enterprise Inns venues which cost the company nearly £30m​ in a cash deal.

At the end of last year the Chiswick-based company also announced it had acquired five pubs from its rival pubco Marston’s​. Both acquisitions are part of a strategy for the business to purchase high-quality sites of a similar trading style in order to give the business momentum as it heads towards the summer.

A summer Turner said would be ‘historic’ and would hopefully drive growth in the economy.

Most volatile​

The pubco will be hoping for a strong summer after a start to the year Turner described as ‘the most volatile and weather‐dependent start to a year that we can remember’.

Over the eight weeks to 26 May 2012, our total managed pubs and hotels sales grew 7.2 per cent, while the like-for-like sales decreased 2.3 per cent.   As the summer sun chases away the economic gloom, we now look ahead to what promises to be a historic time for the country,” he said.

Ill-conceived​

Although like-for-like sales rose operating margins fell in the last year in the Fuller’s managed estate. The company attributed this to not passing on the duty increase to customers, investing in food development teams and the short-term impact of acquisitions and refurbs.

Fuller’s also said it expected the margin on drinks to continue to drop while the ‘ill-conceived’ alcohol escalator remained in place.

Like-for-like food sales in its managed estate grew 4.5 per cent in the last year driven by an increase in covers as a result of the acquisitions.

Through purchasing new sites and through investment programmes, Fuller’s also added 134 rooms to its estate as it continues to explore the growth potential of accommodation. The company revealed 78 per cent of all of its hotel room bookings were made online with investment being made in the in-house website to drive down third party fees.