Pubs prove profitable for W&DB

24-08-2006

Pub firm Wolverhampton & Dudley Breweries have announced a profit increase of 13 per cent in the face of rising costs.

The company, which operates more than 2,000 pubs in Britain, said it had achieved a record increase in its underlying share value of ten per cent in the half-year period covered by today's results.

Total profits reached £40.2 million, a pre-tax increase of 20.2 per cent which reflected a 72.2 per cent rise in cashflow from its operating activities.

W&DB operates a number of subsidiary firms including the Union Pub Company, whose profits grew by 4.4 per cent, while Pathfinder Pubs recorded a notable surge in like-for-like sales of 2.5 per cent during the onset of spring in the last nine weeks.

"These first half-year results include strong growth in turnover and profits reflecting the organic development of the business and acquisitions made over the last 18 months," commented W&DB's chairman, Ralph Findlay.

"Good progress has been achieved despite weaker consumer confidence and the impact of higher energy and employment costs as we have exploited the flexibility inherent in our model."

He also highlighted additional pressures on the catering industry, including the regulatory burden and the forthcoming smoking ban, set to be introduced in England and Wales next summer and already in force in Scotland.

W&DB plan on spending around £20 million in the next year developing patios and shelters for smokers to stand outside and enjoy the fresh air while indulging their habit.

Today's impressive results vindicate the company's decision in March to buy Celtic Inns, which owns 98 pubs, for £43.6 million, a move observers believe reflects the expansionist trend for major players in the UK catering industry.

W&DB, which in the past 18 months has also bought Burtonwood and Jennings Brothers, appears no exception to the rule as it battles through the currently demanding economic climate.


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