Tuesday 09 April 2019 8:10 am | Updated: Monday 03 June 2019 1:43 am

City Pub Group share price rises as it returns to profit after 2017 loss

City Pub Group pulled itself back into profit in 2018, it revealed this morning, as it said it intends to continue its expansion in London and the south east.

Its shares opened 7.3 per cent higher on London's Alternative Investment Market (Aim) this morning, before trimming gains to stand 5.6 per cent up at 235p.

The figures

The pub operator’s pre-tax profits for the year to 30 December 2018 rose to £2.6m after a loss of £0.2m in 2017.

City Pub Group’s revenue rose 22 per cent to £45.7m in 2018 compared to £37.4m in 2017. Its net cash rose to £6.4m in 2018 from £4m in 2017.

At the end of the year net debt stood at £8.7m. Basic earnings per share were 3.23p, a significant improvement on 2017’s figure of minus 2.45p.

The pub group’s total dividend rose 22 per cent to 2.75p, compared to a 2017 figure of 2.25p.

Why it's interesting

City Pub Group underwent a substantial expansion in 2018, opening 11 pubs, including in London, Cardiff, Brighton and Cambridge. It says it is on track to own an estate of 65 to 70 pubs by mid-2021.

It is a relative newcomer to the pub market, having launched in 2011. It operates a predominantly freehold estate of 44 drink-focused pubs in Southern England and Wales.

What City Pub Group said

Clive Watson, executive chairman of City Pub Group, said: “Our performance has been driven by both organic growth and the new pubs coming on stream. Considering the continued strong performance we are delighted to increase our dividend, by 22 per cent for shareholders.”

“We continue to seek new sites to add to our portfolio and we have already earmarked six new pub openings for this year,” he said.

He added: “We are positioned to meet the number of well-trailed headwinds, not least the challenges brought through Brexit, and to take advantage of the softening market for acquisitions with our robust balance sheet and strong cash generation.”