In an update for the 13 weeks to January 2, the publican said trading had been “materially disrupted” by COVID-19 related restrictions across England, Scotland and Wales, with revenues for the period standing at £54mln.
Despite the disruption, Marston’s said it was continuing to develop the business, with its joint venture (JV) with beer maker Carlsberg UK completing on October 30, from which the firm received £233mln which was used to cut down on debts. The firm also said the profit on disposal of Marston’s Beer Company into the JV is expected to be around £280mln and the spot value of the contingent payment to be received in October 2021 is around £20mln.
Looking ahead, the company said it expects customer demand to be “strong” when restrictions are finally lifted and that its pub estate will be “well positioned” due to its predominant presence in suburban locations. It added that its recent deal to operate 156 pubs in Wales owned by brewer SA Brain demonstrated the firm’s “confidence in the medium-term outlook for the UK pub sector”.
The company also highlighted that despite the ongoing disruption to trading it had “significant liquidity” following the completion of the JV and, as such, it remained confident in its ability to navigate the challenging environment.
“The pub sector has been closed for much of the last nine months and remains in a very difficult position. Regrettably there have been casualties across the sector and It is vital that the Government reviews urgently the opportunity to continue to support pubs as we reopen the economy in the coming weeks. Pubs are viable businesses which are part of the social fabric of Britain and which make a major contribution to the economy and the communities in which they serve. It is vital that they not only survive the short-term crisis but are supported in order to recover and flourish. Extending the business rates holiday and VAT cut for the rest of this year is a minimum requirement”, Marston’s chief executive Ralph Findlay said in a statement.
“Despite these challenges, Marston’s has a significantly strengthened balance sheet following the creation of the joint venture with Carlsberg and the financial headroom to weather the extended period of current trading restrictions. With the roll out of the vaccine programme now underway nationwide, we remain well positioned to rebuild trading momentum once restrictions are lifted, as well as to leverage potential market opportunities open to us.
We have a clear strategy in place which leaves us confident for the future of our business over the medium term”, he added.
Marston’s shares were down 1.1% at 73.7p in early deals on Friday.