Marston’s losses narrow amid hopes of summer sporting calendar boost

  • Marston’s reported underlying net losses of £0.6m in the six months to March
  • Trading outperformed the broader market, thanks to strong festive demand

Marston’s expects major sporting events to revive sales this summer as the pub operator posted another first-half loss.

The Wolverhampton-based firm reported underlying net losses of £0.6million in the six months ending March, down from £2.9million in the equivalent period last year.

Trading outperformed the broader market thanks to strong demand over the festive season and higher food and drink orders boosting like-for-like sales by 7.3 per cent.

Drink to that: Marston’s reported underlying net losses of £0.6million in the six months ending March, down from £2.9million in the equivalent period last year

On a statutory basis, though, the company’s losses increased by about 27 per cent to £36.6million because of liabilities from interest rate swaps of £25.8million and a one-off charge related to CMBC’s ale brand impairment and onerous contract provision.

Marston’s expects to perform better in the second half of the financial year, when it tends to achieve higher revenues, earnings, and cash flow due to sunnier weather.

But the company also anticipates benefiting from the various major sporting events over the summer, when the Paris Olympics and European Football Championships take place.

Britain’s hospitality industry hopes the extensive sporting calendar in the coming months will bolster trade following multiple challenging years defined by the Covid-19 pandemic and cost-of-living pressures.

For Euro 2024, the UK Government has said pubs will be allowed to stay open for an extra two hours on match days should either England or Scotland get to the semi-finals, potentially providing another uplift to sales.

Justin Platt, chief executive of Marston’s, said: ‘With a number of ‘must not miss’ major sporting events, our massively upgraded pub gardens and much-loved food menus, we expect our pubs to be very popular this summer.’

Beyond the summer, Marston’s believes it will continue profiting from the pandemic-induced shift to remote working driving more sales towards rural and suburban areas, where its pub estate is largely located.

However, the group remains beset by a £1.2billion debt pile, more than five times its market capitalisation of £206.4million.

It aims to cut debts to below £1billion by 2026, partly through selling some pubs, with £50million of non-core and unlicensed property sales forecast this fiscal year.

Platt added: ‘With our high-quality estate and guest-obsessed team, we are well placed to capitalise and to deliver consistent, reliable cashflows that will drive value for our shareholders.’

The former Merlin Entertainments executive took over as Marston’s CEO in January when Andrew Andrea quit after two decades working for the firm, which runs about 1,400 pubs across Britain.

Marston’s shares declined 2.5 per cent to 32.9p by late Tuesday afternoon, far below its pre-Covid level.