viewCity Pub Group Plc

City Pub Group unveils measures to counter coronavirus impact

The pubs group says it will look to reduce staff costs and reduce "non-productive" opening hours, while its directors will take a 25% pay cut

City Pub Group Plc - City Pub Group unveils measures to counter coronavirus impact

City Pub Group Plc (LON:CPC) has unveiled several measures to “reduce costs and preserve cash” as it moves to lessen the impact of the coronavirus outbreak on its operations.

The AIM-listed group said it will reduce employee costs both at its head office and its pubs around the UK, which its directors will also have their salaries reduced by 25%.

WATCH: The City Pub Group grows

City Pubs also said that it is also looking to reduce variable costs such as Sky/BT Sport broadcasts and other entertainment expenditures where applicable as well as a review of its trading hours to reduce “non-productive opening times”.

Based on the above actions, the company said it was confident that will have “sufficient working capital to maintain its operations for at least another six months” even if the UK government mandated the temporary closure of all pubs and bars.

The firm is also entering negotiations with its landlords to seek rent holidays for the next 3-6 months.

For the 11 weeks to 15 March, the company reported that turnover was up 11% on the prior year, with like-for-like sales down 4.5%, however, it added that recent trading had been impacted by coronavirus and that certain sites had witnessed “noticeable reductions in trade”, although community pubs had been more resilient to the downturn.

As a result, the firm said it now expected “a material reduction” to its expectations for 2020, although it was “difficult to accurately assess” the extent to which the virus will impact its financial performance.

City Pubs said it will provide a further update with its full-year results in April.

In a note to clients, analysts at house broker Liberum Capital reduced their target price for City Pubs to 155p from 255p but retained their ‘buy’ rating, forecasting that the outbreak could reduce trading by 50% over the next six months. However, they added that, despite this, the company “should be able to trade at breakeven on a six month view”.

City Pubs shares were down 14.6% at 70p in early deals.

Quick facts: City Pub Group Plc

Price: 81.3999 GBX

Market: AIM
Market Cap: £84.46 m

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events


The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of City Pub Group Plc named herein, including the promotion by the Company of City Pub Group Plc in any Content on the Site, the Company receives...



Full interview: The City Pub Group grows

A cold wet December meant admittedly slower trading for The City Pub Group (LON:CPC) but that hasn't dampened their appetite for growth. Just a few years ago, CEO Clive Watson headed up 30 watering holes but now has almost 50, with plans for new UK sites in Bath, Cambridge and Exeter. Watson...

on 20/1/20

2 min read