Beer sales up, but trouble brewing on tax

The firm announced underlying pre-tax profits of 26.6m for the year to March 27 and said sales had continued improving into the new financial year.

But Chiswick-based Fuller, which brews London Pride, said there were concerns for leisure spending ahead of austerity measures to slash public debt.

Recent duty increases have already seen the Government take 30 per cent of the price of a pint of beer in the pub and sometimes more than 100 per cent of the price in the supermarket, according to Fuller.

Michael Turner, chairman of Fuller, said: "We continue to be very cautious about the outlook for the UK economy.

"We may technically have emerged from recession and the economy may no longer be contracting, however, with the prospect of personal taxation in our target market rising further and disposable incomes reducing there may be less leisure spend available in real terms."

Fuller, which has 366 pubs, reported annual revenues up 8 per cent thanks to a 2.7 per cent rise in like-for-like sales in its hotels and managed pubs business, while sales volumes of its own beers in the brewing business lifted 2 per cent.

The tenanted pub division saw a 1 per cent drop, but this was an improvement on the 3 per cent fall at the half-year stage.

Shares rose 6 per cent after the full-year figures came in better than expected. The firm also outlined a "solid start" to the new financial year, with hotel and managed pub sales in the first 10 weeks ahead by 3.5 per cent on a comparable basis.

Brewery beer sales remained flat, however, as strong exports were offset by a weaker showing in the on-trade pubs market.

The increasing export business helped Fuller's Beer Company, increase underlying earnings by 7 per cent to 8.9m to March. Exports soared13 per cent, boosted by the weak pound.

Hugh-Guy Lorriman, analyst at Seymour Pierce praised "excellent results" and said current trading so far was "one of the best performances of a listed managed pub company to be reported this year".