25th Nov 2025 11:29
(Alliance News) - Marston's PLC on Tuesday said it was well positioned for the festive period after reporting profit and cash flow progress in the financial year just ended.
The Wolverhampton-based pub chain said pretax profit ballooned to GBP88.3 million in the 52 weeks to September 27 from GBP14.4 million the year prior, or by 71% on an underlying basis to GBP72.1 million from GBP42.1 million.
Marston's said the "second consecutive year of significant profit growth" was driven by progress on like-for-like sales, contribution from new formats, disciplined cost control, and reduced interest costs.
Revenue was little changed at GBP897.9 million from GBP898.6 million, with LFL sales growth of 1.6% down from 4.8% the year prior, but "ahead of the market, with, food, drink and machines all in growth."
Recurring free cash flow of GBP53.2 million improved from GBP43.6 million a year ago, and was ahead of the GP50 million capital markets day target.
This was "delivered ahead of schedule" and provides "confidence in the group's ability to sustainably deliver significant levels of recurring free cash flow," the company said.
In response, shares in pub chain surged 20% to 60.00 pence each in London on Tuesday, a more than 3-year high.
Marston's said LFL sales for the 8 weeks to November 22 are "tracking in line with the prior year" while Christmas bookings are strong, 11% ahead of the same point last year.
"The group is well positioned for a strong festive period and FY2026, supported by ongoing format conversions and a robust calendar of demand-driving events, including the 2026 World Cup," the firm added.
Marston's plans to accelerate roll-out of its pub formats with at least 50 new format launches.
Capex spend will remain in line with CMD guidelines of 7% to 8% of total revenue.
Cost pressures remain manageable and further margin uplifts are expected in the year ahead given current cost visibility, Marston's added.
"We enter 2026 with significant momentum," said Chief Executive Justin Platt.
Over the near-to-medium term, Marston's continues to expect to deliver on the targets set out at the CMD which include: revenue growth ahead of the market; earnings before interest, tax, depreciation and amortisation margin expansion of 200 to 300 basis points beyond financial 2024, targeting 23.4% to 24.4%; over GBP50 million recurring free cash flow; and more than 30% return on invested capital on investment focused capex.
No dividend was declared. Marston's noted leverage fell to 4.6 times from 5.2 a year ago but remains higher than target.
"Shareholder returns remain a core part of our capital allocation strategy and are planned once leverage falls below 4.0x," the firm added.
By Jeremy Cutler, Alliance News reporter
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