Young’s boosts profits as pub investment pays off

South London pub chain Young’s reported boosted profit this morning on the back of increased investment in its estate.

Revenue was up 8.8 per cent from £144.1m to £156.8m, while profit before tax increased from 22.1m to 26.4m, a jump of 19.4 per cent, the company announced this morning in its interim results. 

The brewery will issue an increased interim dividend per share of 9.97p, up six per cent from 9.41p.

The group increased investment in its pubs to £12.1m, and opened a new pub in Woodbury Down, and reopened The King’s Arms in Wandsworth.

Major projects were also completed at the group’s pubs in Wimbledon, Kew, Redhill, Earlsfield, Covent Garden, Southwark, Clapham, Bristol and Borough Market.

Going forward, the chain expects to see benefits from branches in Smithfield Market and Cannon Street following refurbishments, and will open a pub in Kidbrooke Village next spring. It has also exchanged contracts on the People’s Park Tavern in Victoria Park.

In a similar trend to other publicans, the group was also boosted by England’s success in the World Cup and the UK’s summer heatwave.

Young's chief executive Patrick Dardis said: "I am very pleased to report another strong period of trading, driven by our well-invested managed house estate which has once again outperformed the wider market.

“Propelled by the hottest English summer on record, our beautiful riverside locations, stunning gardens and growing number of roof terraces helped to deliver 5.2 per cent like-for-like sales growth in our managed houses, continuing our trend of exceptional summer performances with average like-for-like sales growth of 5.6 per cent over the past seven years.

“Drink sales enjoyed a particularly strong summer with double digit growth of just over 10 per cent in total and 7.4p per cent on a like-for-like basis while recent investment in our hotel business saw accommodation sales rise by just over 18 per cent during the period.

“Despite severe cost headwinds and ongoing political uncertainty, our expectations for the full year remain unchanged and, thanks to one of the lowest levels of gearing in the sector, we have significant financial capacity for future investment with a strong pipeline of acquisition opportunities.”