Marston's warns of tough winter ahead after posting £397 million annual loss
Pub operator Marston's has warned of a challenging and uncertain period ahead as it posted a loss of almost £400 million.
The Wolverhampton-based group, which has pubs across the region, said sales were impacted by the 15-week closure of pubs from the end of March due to the Covid-19 pandemic.
Its total pre-tax loss was £397.1 million for the year ended October 3 2020, compared with a loss of £20.1 million last year.
Revenues also slipped at the firm, from £1.17 billion in 2019 to £821 million this year.
The firm has seen 780 of its pubs remain closed after the fresh coronavirus-induced lockdown in November.
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The company, which has already launched consultations on up to 2,150 job losses to deal with the sales hit due to lockdowns, said that government support through reduced value-added tax, business rates holiday and other taxes remains necessary.
Marston's aims to reduce debt and it intends to spend between £40 million and £45 million per year and sell non-core assets of about £10 million per year.
Challenges
CEO Ralph Findlay said: “2020 has been an extraordinarily difficult year for the pub and wider hospitality sector which has been particularly hard hit by the pandemic. I would like to thank the entire team at Marston’s for their loyalty, dedication and hard work in such trying circumstances.
“Whilst short-term uncertainty remains, we have taken swift action to future-proof the business to withstand the challenges presented by the pandemic and Marston’s has emerged a significantly stronger business, with a substantially strengthened balance sheet and well placed to rebuild trading momentum when restrictions are eased. The roll out of the vaccine is clearly critical to that, but in the meantime the sector continues to face major challenges and government support will need to continue in order for many viable businesses to survive."
The company said the outlook is more positive looking forward as Britain began mass-vaccinating against Covid-19 earlier this week.
Earlier this year Marston's also announced a joint venture with Carlsberg UK to create a new brewing business.
Mt Findlay added: “Looking forward, Marston’s has entered the current year fit for the future and excited about the next chapter in the company’s development as a focussed pub and accommodation operator.
"We look forward to realising the potential of the group’s brewing JV with Carlsberg and wish the team at CMBC every success.
"There is clear evidence that consumer demand for our pubs remains strong and our geography, as a predominantly community pub operator with 90 per cent of our well invested, high quality pubs located outside city centres, leaves Marston’s well placed to leverage the market opportunities available to us over the medium to longer term.”
