Greene King reports revenue of £1.34b

Pub group Greene King has reported revenue of £1.34b, an increase of 41.6% compared to the previous year, with growth in all five of its divisions.

For the 52 weeks to 2 January 2022, the company reported strong trading in the second half despite a financial performance that continued to be significantly impacted by Covid-19, which reduced revenue and profitability.

Group loss before tax and adjusting items was £113.8m in the 52-week period to 2 January 2022, while earnings before tax, interest, depreciation and amortisation (EBITDA) was £156.3m. All pubs were closed for the first 15 weeks of the reporting period, followed by significant periods with restrictions and suppressed customer demand. The group returned to being cash generative from operating activities, with free cash flow of £7.2m due to strong trading in the second half and cash preservation measures put in pace during the pandemic.

Despite trading challenges, the business spent £68m on core capex including investing £4.7m in the development of outdoor trading areas.

Coming out of the third lockdown, Greene King’s focus moved to refreshing and improving the offer of its Chef & Brewer brand, the formation of its premium Crafted Pub Company concept, the expansion of Metropolitan Pub Company including moving four sites from the core estate and the purchase of the Fountain House in Manchester to drive growth outside of London, three new concept formats in its local pubs division, and the launch of its branded franchise concept Hive Pubs.

The group also spent £95.4m on the freehold of 30 sites that were previously leased and £19.3m on four single site acquisitions, their development and the freehold reversion of three further sites.

Nick Mackenzie, Greene King chief executive, said: “Greene King has delivered a resilient performance over the past year, against the backdrop of unprecedented disruption to our business. We managed to return to underlying profitability, in spite of our pubs being shut or restricted for long periods of time and our customers facing massive uncertainty and disruption to their lives.”

He added: “Whilst sales have broadly returned to 2019 levels, the underlying challenges of significant cost inflation, labour shortages and regulations will continue to impact the pace of recovery of the sector and we therefore look to the government for support through business rates and alcohol duty reforms.”