Strong food, wine and coffee sales push Greene King's profits up 7%

The company, which operates 2,256 pubs, restaurants and hotels, said food sales across its 987 retail brands such as Hungry Horse, Old English Inns and Loch Fyne Restaurants, were up 9.7 per cent to £336.9m and now accounted for 40 per cent of its total sales. 

In a statement showing results for the year ending 28 April 2013, it claimed much of the growth had come from identifying three key trends - 'customisation', which allowed customers to choose their own burger or fish combinations in Eating Inn, Flame Grill and Loch Fyne; 'convenience', demonstrated with its Cakeaway offer in Hungry Horse and breakfast and lunchtime deli deals and 'health' with the introduction of its 700 calorie and gluten free options under the Live Well section on the Eating Inn menu.

While wine sales have fallen in general ​Greene King, who introduced its own-label wine brand Piazzi and installed a dedicated wine specialist in its Metropolitan branches, said sales within that category had grown almost 16 per cent, a 62 per cent rise in the last five years. 

Hot beverage sales, of which coffee comprises 75 per cent, grew 6.2 per cent. Greene King chief executive Rooney Anand, whose group uses Illy across 86 per cent of its sites and own coffee brand Big Bean in Hungry Horse sites, said he expected further growth with the growth of its breakfast trade. 

Expansion on track​

Anand said the company was 'on track' with its plans to operate 1,100 retail sites by 2015. 

"In the year, we increased our trading estate by a net 33 sites, having acquired or transferred in 38 sites and disposed of five non-core sites. This took the estate to 987 pubs, restaurants and hotels," he said.

"Of those new sites, 12 were single-site acquisitions, 12 were new build openings, including our first Hungry Horse leasehold site, and 14 were transfers from Pub Partners, including 11 Meet & Eat sites. These transfers are supporting the expansion of the Meet & Eat brand within Retail. In addition, our pipeline for further expansion is healthy and we exchanged or completed on a further 30 sites."

The retail business was the main driver of a 'successful year with record results' Anand said in his statement. 

"Our strategy is on track and we have continued to provide exceptional value, service and quality to our customers. We achieved growth in both earnings and dividends, and further improvement in ROCE for our shareholders," he said. 

"We have made a strong start to the year, but the overall outlook remains subdued and we are not assuming a pick-up in the economy. However, our strategy is designed, and proven to be appropriate, for these conditions as we shift our business towards higher growth areas of our markets and constantly improve our customer offer. We are confident of maintaining this momentum and delivering further value to our shareholders.”