Shares in Marston’s PLC (LSE:MARS) jumped 8.8% to 54.4p, the highest level in over three years, after the pub company posted a second consecutive year of significant profit growth and margin expansion.
Underlying profit before tax rose 71% to £72.1 million in the year to 27 September 2025, driven by margins improving to 22.8% from 21.4% and a 16.5% reduction in interest costs.
Like-for-like sales for managed pubs increased 1.6%, outperforming the market, with growth of 2.2% for food and 0.3% for drink.
Management said growth was helped by investment into 31 new pub format conversions during the year, delivering average revenue uplifts of 23%, and wider estate upgrades.
Recurring free cash flow of £53.2 million was reported, ahead of its £50 million capital markets day target, while net debt excluding lease liabilities fell to £837.5 million, from £883.7 million a year earlier and down nearly a third since 2022.
CEO Justin Platt said it was "another strong year ahead of plan" and that new pub formats "are performing exceptionally well", meaning "we enter 2026 with significant momentum and confidence".
LFL sales for the 8 weeks to 22 November were said to be tracking in line with the prior year, while Christmas bookings were 11% ahead of last year.
At least 50 new format launches are planned, with capital investment to stay within 7-8% of revenue and margin gains expected to continue, supported by cost pressures that "remain manageable" and ongoing efficiency measures.