Pub and brewing group Greene King (LON:GNK) toasted a 10% share price rise on Wednesday as its latest half year numbers showed a near 47% rise in pre-tax profit.
The group, which runs the Loch Fyne restaurants and Hungy Horse brands, said it had seen revenue and profit growth across all divisions, with adjusted earnings per share (EPS) up 15.4% as punters benefit from increased wages.
But it did warn that consumers were still spending more on big items rather than going to the pub.
Greene King said the consumer environment improved in the first half, but said the UK eating and drinking out market still did not fully reflect increased consumer confidence.
It said larger-ticket and other discretionary items "remain bigger beneficiaries of the return to real income growth."
Chief executive Rooney Anand said: "We are mindful of an increasingly dynamic, fragmented market and intense competition for every pound in the consumer pocket."
The group, which has now completed its acquisition of Spirit Pub Company, said revenue and profit rose across all its divisions in the 24 weeks to October 18.
Pre-tax profit increased 46.9% to £121.3mln on a 49.2% rise in total revenue to £917.7mln.
The group lifted its interim dividend per share by 6.3% to 8.45p.
But Greene King said its operating margin was 19.6%, 0.5%pts lower than last year.
That reflected a higher contribution from managed pubs and a 0.3%pt moderation in the existing Greene King business led by retail, where the margin declined by 0.2%pts due to investment in staff and customer service.
It said its integration of Spirit was going well and was ahead of plan. It said it now expected to exceed its initial guidance on cost savings and had raised the target to £35mln.
It also hopes to boost revenue by making the most of its combined brand portfolio and increasing distribution of ale brands.
The group, which employs 42,000 people, with half under 25, said the planned increase in the UK national minimum wage would affect it, but it hopes to offset most of the impact by better staff management.
Shares added 10.69% to stand at 942.5p.