2nd Sep 2008 07:00
PRESS RELEASE
|
2 September 2008 |
GREENE KING plc
INTERIM MANAGEMENT STATEMENT
Greene King plc announces its interim management statement for the 16 weeks to August 24th, which will be delivered at the Annual General Meeting today.
Market conditions remain challenging as consumer confidence continues to weaken and consumer expenditure continues to contract. Within this environment, Greene King is well placed to withstand many of the pressures these trends create: the Greene King model is robust and resilient; strong cashflows allow continued investment in growth areas such as food, accommodation and premium ale; and the tough approach to cost management creates opportunities to drive further value into the business.
For the first 16 weeks, LFL sales in Greene King Retail were -1.6%. Larger, food-led sites continue to perform strongly, whilst smaller, wet-led community sites are being more adversely affected by market conditions. In the value for money segment of the market, new Hungry Horse is in good growth, whilst at a more premium position both Loch Fyne and the Inns division are performing well. Management remains focused on achieving the optimum balance between sales, margins and profit, particularly given a cautious consumer and escalating costs.
In Pub Partners, the tenancy and lease division, LFL profits are -1.7%. Since reporting in July, the main indicators of licensee health are broadly unchanged. The environment continues to be challenging but Pub Partners' predominantly tenanted model creates strong relationships with its licensees. As a result, an increasing level of support is being provided to underpin licensee viability.
Brewing Company own-brewed volumes are down 3%, but given near double-digit* declines in the on-trade beer market, this is a strong performance. Share gains continue in both the on and off-trade, and in the standard and premium ale categories.
In Scotland, Belhaven continues to perform ahead of expectations. LFL sales in the managed pub estate are up 4.6%, whilst Belhaven Best has now become the fifth best-selling on-trade alcohol brand in Scotland, according to new research from AC Nielsen.
To date, the company's cashflow performance and balance sheet position remain healthy and in line with forecasts. Following the successful debt refinancing, interest rates are 100% fixed and no further refinancing is required until 2012.
Despite the current trading challenges and lacklustre outlook for the UK economy, the board anticipates meeting its expectations for the year.
* BBPA MAT to July 2008
For further information:
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Greene King plc |
Rooney Anand, Chief Executive Ian Bull, Group Finance Director |
Tel: 01284 763222 |
|
Financial Dynamics |
Ben Foster |
Tel: 07776 240 806 |
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