Greene King benefits from downturn

The 212-year-old firm, which has 2,410 pubs, said the consumer environment remains challenging with cost inflation rising ahead of wage inflation and discretionary spending being squeezed.

“In this environment, the on-trade drinking out and eating out markets are performing well, delivering an ‘everyday indulgence’ to the UK consumer,” the company said.

The UK pub sector is providing a rare bright spot among the economic gloom, with Marston’s, Mitchells & Butlers, Young’s and Fuller’s reporting rising sales and profits.

Greene King, whose chains include Hungry Horse, Old English Inns and Bellhaven, said pre-tax profits before exceptional items rose by 5.6 per cent to £77.2m in the first half to October 16.

Numis analyst Douglas Jack had forecast a seven per cent rise to £78m.

Pubs are benefiting from increasing demand for casual dining as customers trade down from eating out at restaurants.

Greene King said drink sales rose by 9.9 per cent with food sales up 16.3 per cent.

Shares in Greene King have outperformed the FTSE All Share Travel & Leisure Index by eight per cent over the past year.