Marston’s earnings soar with pub group’s festive bookings already forward of final yr

Marston’s is preparing for a bumper festive season, with Christmas bookings already ahead of 2023, as the pub group caps a year of solid profit growth.  

The group posted adjusted pre-tax profits from continuing operations of £42.1million for the year ending 28 September, up 64.5 per cent year-on-year and surpassing Peel Hunt forecasts of £40.5million. 

Marston’s, which runs over 1,300 UK pubs, said revenues increased by 3 per cent to £898.6million, with like-for-like sales rising by a market-beating 4.8 per cent thanks to higher food and drink orders.

Marston’s has benefited from a shift in spending to suburban and rural areas caused by more Britons working from home or moving out of city centres.

It has also been less impacted than rivals like Fuller’s by industrial action on the railways and minimised inflationary pressures by hedging gas and electricity costs.

Despite heavy snow and storms in recent weeks, the firm has continued to enjoy healthy trading, with like-for-like sales up 2.1 per cent in the first eight weeks of this financial year.

Trend: Marston’s has benefited from a shift in spending to suburban and rural areas caused by more Britons working from home or moving out of city centres

Marston’s noted its Christmas bookings were ‘tracking ahead’ of the previous year, boosted by high reservation rates at many venues, which it said ‘positions us well for a successful trading period during December’.

The Wolverhampton-based group also claimed the extra costs it will incur from the recent Budget are ‘manageable’ with respect to its near-to-medium-term targets.

From April 2025, firms are due to pay a 15 per cent National Insurance rate on staff salaries exceeding £5,000, instead of the current 13.8 per cent levy on wages above £9,100.

Concurrently, those aged 21 and over will see their minimum hourly pay go up by 6.7 per cent to £12.21, while the minimum wage for 18 to 20-year-olds will rise by 16.3 per cent to £10 per hour.

Marston’s significantly bolstered its balance sheet last year by selling its 40 per cent stake in Carlsberg Marston’s Brewing Company, which contributed to its net debts falling by around £300million to £883.7million.

Justin Platt, chief executive of Marston’s, said: ‘2024 has been a defining year for Marston’s as we began an exciting new chapter as a leading pure-play hospitality business.

‘The sale of our stake in CMBC has been transformational, enabling us to significantly reduce debt, increase our flexibility and focus on what we do best: running great local pubs.’

CMBC was founded in 2020 after Marston’s merged its brewing business with Carlsberg’s UK division in return for a cash payment of up to £273million.

Marston’s shares were 6.7 per cent up at 42.95p on Tuesday morning, taking their gains to about 37 per cent over the past year.

Julie Palmer, partner at Begbies Traynor, said: ‘With festive trading off to a strong start and a continued focus on debt reduction and operational efficiencies, the group is entering 2025 with a solid foundation for sustainable long-term growth.

‘It’s a tough environment for UK pub operators, but Marston’s has every reason to raise a glass to this year’s successes and hopefully look forward to more in the next.’