Shares in Marston’s plc (LON:MARS) fell at the opening bell on Tuesday after the pub operator and brewery said the snow and icy weather over the Christmas period hit its profits to the tune of £1mln.
The FTSE 250 company said the bad weather in early December and between Christmas and New Year “caused some unavoidable disruption” to the business. Total sales in Marston’s destination and premium business actually grew 4.9% in the 16 weeks to January 20 2018, reflecting the contribution from new pubs added to the estate in the year.
Bad weather puts punters off
But like-for-like sales fell 0.9%, largely due to the bad weather which the company also reckons wiped £1mln from its bottom line over the period.
As with many pubs, restaurants and retailers, cost inflation has become an issue due to the weaker pound and higher business rates, but Marston’s has decided not to pass these on to the consumer in the form of higher prices yet, leading to a slight fall in margins.
It would seem that most of Marston’s peers have adopted even more aggressive pricing strategies though, with the company bemoaning the “significant discounting which has remained prevalent in the sector”.
Like-for-like sales in its taverns division grew 2.6% over the four-month period thanks to “an improved drink range”, while its leased estate also performed well, with profits up 2%.
Marston’s Beer Company saw own-brewed volumes up 33% over the 16 weeks, benefiting from distribution gains as well as the addition of the Charles Wells Brewing Business, which brought in the Bombardier and Young’s brands to the group.
Record Christmas Day
The Wolverhampton-based company added that it is on track to open 15 pub restaurants and bars this year, as well as six lodges.
"We are pleased with our progress, which included record total retail sales in our pubs of £4 million on Christmas Day - 5.4% higher than last year,” said chief executive Ralph Findlay.
“We continue to achieve growth against tough market conditions and are benefiting from investment in both pubs and brewing.”
Shares fell 4.7% to 109.2p early on Tuesday.