Young’s doesn't expect sales to 'normalise' until 2022
In an update to the London Stock Exchange, the pubco said that following an August reopening, it expects trading during the 2021 financial year to be materially below average, but it remains confident in its “proven strategy” for when the trade environment begins to normalise.
It revealed that during the ten days of closure (from 20 to 30 March) and the gradual decline in trade preceding it, the business saw an estimated £13m shortfall in revenue, with £7.7m impact on profits.
Operating profit (adjusted for non-underlying items) was £44.8m, down by £3.7m with an operating margin of 14.4%.
Through the closure period, the group has taken several steps to secure its estate, and has said it now has in place £285m of funds and committed facilities.
Total group revenue for the year to 30 March 2020 was up by 2.6% to £311.6m, and managed house revenue was up 3% to £299.1m, supported by the significant Redcomb pubs acquisition completed in January last year.
Like-for-like sales were down on the previous year by 2.4%, which the group attributes to challenging trading conditions exacerbated by poor weather and London rail strikes.
More optimistically, the group acquired five premium pubs in south-west London and Surrey last year and made a significant investment of £70.8m in upgrading its estate, which it hopes to benefit from when trading returns.
“I am proud of the performance of our business this year despite the unique challenges that we have faced,” said Patrick Dardis, Young’s CEO.
“These results demonstrate the continued strength of our strategy of operating a differentiated, premium and well-invested pub estate.
“We are confident with the steps we have taken to safeguard our business from the immediate threat of coronavirus. The board expects the business to be in a position to return to profitable growth when this unprecedented period is at an end and conditions allow, and we remain confident in our proven strategy.”
