UK: Charges drag Punch Taverns into the red for H1
- Group swings to net losses of GBP324.8m
- Operating losses hit GBP285.8m
- Net sales slip by 3% to GBP655.4m
Punch Taverns falls into the red
Punch Taverns has swung into the red for the first half of its fiscal year, underlining the challenge faced by management to reform the business.
The UK pub and bar group today (12 April) reported net losses of GBP324.8m (US$528.5m) for the 28 weeks to 5 March. Charges amounting to GBP369.5m, much of which related to the falling value of the firm's pub estate, wiped out profits of 59.2m in the same period of the previous year.
The group also swung to operating losses of GBP285.8m, versus operating profits of GBP186m last year.
The results again highlight the difficulties faced by the UK on-trade in general and, in particular, the country's largest pub groups. Last month, Punch announced a plan to split its business in two and sell off half of its leased pub estate - around 3,000 outlets - within the next six years.
Net sales at the group also fell for the half-year, although not with the same gravity as profits, by 3% to GBP655.4m.
Despite the difficult first-half, Punch said that trading for the full-year is set to meet its expectations and that the firm has made a good start to its third quarter. "Despite the challenging UK consumer environment, we remain confident of making further progress in the second half of the financial year," said Punch's CEO, Ian Dyson.
Matthew Clark, the on-trade distributor owned jointly by Punch and Constellation Wines Australia & Europe, had a "satisfactory" half-year, Punch added.
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