The World Cup and hot summer was something of a double-edged sword for Marston’s plc (LON:MARS).
The company said sales in its wet-led pubs got a boost from the warm weather and the football, while its food-led establishments suffered.
READ: Forget gastropubs, ‘wet-led’ pubs are back on top once again
Most of the casual dining industry reported similar headwinds this summer, as people flocked to beer gardens to enjoy a G&T in the sun or crowded around televisions with a pint to cheer England on.
Analysts have called this summer “exceptional” in terms of its boost for pubs, but Marston’s said trading in its wet-led and community estate has been “consistently strong” throughout the year.
Similarly, the firm’s Beer Company division, which distributes to one in four UK pubs, also took advantage of the increased demand for beers and bitters.
It sold more than 1mln barrels of its own and licensed beers, including Brakspear and Bombardier, for the first time ever and distributed 2.5mln composite barrels of drinks.
Crowded UK dining sector
By contrast, Marston’s destination pubs, which put more of an emphasis on their food offerings, saw stronger drink and accommodation sales offset by a slump in food sales.
Even without the drag from the World Cup and warm summer, restaurants have struggled of late as companies battle to get customers through the door, eroding already thin margins.
Marston’s said it tried not to get involved with the discounting in the sector and expects operating margins in its destination pubs to only be around 0.5 percentage points below last year.
That said, food sales have picked up slightly, with like-for-like sales rising 0.1% over the past couple of months compared with a year earlier.
Record profits
Still, Marston’s expects the warm summer of footy to be a net benefit to the company as a whole and is guiding for a record set of set of full-year results for the 12 months ended September 29.
The company is forecasting a 15% jump in revenue to £1.1bn and a 4% rise in underlying pre-tax profits to £104.1mln.
“2018 was a strong year for our Taverns and Beer businesses,” said chief executive Ralph Findlay.
“We have seen clear benefit from our balanced portfolio having achieved good growth in wet-led pubs and from brewing, maximising the trading opportunities provided by the good summer weather and World Cup.”
He added: “Although trading in Destination food-led pubs was weaker, this predominantly reflects issues beyond our control relating to unseasonal weather extremes and the World Cup.
“However, we are encouraged that our dining pubs are now seeing improving momentum and we expect to make further progress in 2019.”
Shares fell 3% in early trading on Wednesday to 98.2p.