Pub companies clear the Olympic hurdles

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TWO of the UK’s biggest pub companies have weathered the “disruption” caused by the Olympics with robust trading over recent weeks.

Greene King, which operates 2,300 outlets including Hungry Horse and Loch Fyne Restaurants, said underlying sales rose a “reassuring” 5.1 per cent in the past 18 weeks, as strong demand for its food helped pull in the punters despite the poor summer weather.

The Bury St Edmunds based group said the Olympics had a minimal overall impact, with quieter trading in central London offset by a stronger performance in the city’s suburbs.

And it was a similar story at Spirit Pub Company – the owner of the Chef & Brewer and Fayre & Square brands – which saw sales at its managed estate rise 4.1 per cent in the 12 weeks to August 18.

Mike Tye, chief executive of Spirit, which operates 1,300 pubs following its demerger from Punch Taverns last summer, said: “We have finished the year strongly despite challenging trading conditions created by the poor summer weather and the disruption caused by the Olympic Games.”

He added that its managed estate performed “significantly” ahead of the market and warned the consumer environment remains tough.

Spirit said it had reduced the value of its estate of pubs by £500m to £1.3bn because the majority were on its books at acquisition cost.

Meanwhile, Greene King said its performance was “encouraging” although it warned that consumer confidence will remain subdued.

Sales of Greene King IPA were boosted following a £4m relaunch in April, while Old Speckled Hen also saw strong growth.

Investec analyst James Hollins said Greene King had proved its credentials as a quality pub operator during 2012, helped by having a large number of its sites in London and the south-east, which have been more resilient since the downturn.

He increased his pre-tax profit forecast for the year to April from £143.6m to £160.6m.