Punch Pubs posts 44% profit uplift

Punch Pubs has reaped the benefits from its rapid site acquisition strategy, posting a 44% increase in operating profit for the year ending 11 August 2024.

In its 2024 financial year it generated £48.4m of operating profit, compared to £33.7m the previous year.

Revenue rose steadily, reaching £324.3m, 3% up on the 2023 financial year’s £313.5m.

All three divisions (leased and tenanted, management partnership and Laine Pub Co) delivered like-for-like sales growth for the year when compared to the prior year.

Punch has added more than 50 pubs to its portfolio in the last 12 months, including a deal to buy 14 sites from real estate investment company Aprirose in September, which followed the acquisition of 24 pubs from the Milton Three pub group, the operator of the Wear Inns portfolio that fell into administration last year.

The pub group reported that its underlying EBITDA of £91.2m to 11 August 2024 will be boosted by £3.4m incremental EBITDA from its acquisition of 36 pubs in Q3 and Q4; and £2.8m of run-rate cost saving efficiencies will be realised within the next 12 months.

After the end of Punch’s financial year, it acquired another 18 pubs, which are forecast to deliver an additional £2.3m of run-rate EBITDA following their first year of post-acquisition trading.

During Q4, the company delivered £26.2m of underlying EBITDA, representing 19% growth from the £22.1m total in the same quarter of its 2023 financial year.

In this quarter, Punch invested £8.2m of capex into its pubs, alongside acquisitions representing £8.1m.

The group also disposed of eight pubs in the quarter, generating proceeds of £3.8m.

The Punch Pubs group currently comprises 1,258 pubs, 92% of which are owned on a freehold or long-leasehold basis.