Punch Taverns, which has more than 6,000 pubs, said underlying profits fell 8.4% to £206 million in the six months to March 5 as its leased division saw a seven per cent decline in like-for-like net income.
But the group, which last month announced plans to demerge its Spirit managed pubs division, said there was an improving trend on the previous year and that it remains confident of making further progress in its second half.
The group also announced that its chief executive, Ian Dyson, will become boss of the Spirit division following the demerger, while Roger Whiteside, currently managing director of the leased division, will become chief executive of Punch.
Punch, one of the UK’s biggest pub companies, has suffered in recent years as the ban on smoking and a trend towards people drinking cheap supermarket beer from the comfort of their homes have hit sales.
Its restructuring plan devised under new boss Mr Dyson, who joined from Marks & Spencer last year, will see it close more than 2,500 pubs as it seeks to tackle its £3 billion debt mountain.
The demerger of the 950-strong managed Spirit pubs, which include the Flaming Grill chain, will leave Punch with an estate of some 5,200 pubs leased and tenanted pubs, in which landlords rent the pub and get their supplies from Punch.
It has identified some 3,000 of these as ‘core’ pubs and the rest will be closed at the rate of about 500 a year. Another 450 pubs are to be offloaded from the Spirit business.
Mr Dyson has said a demerger will boost prospects for the faster-growing Spirit business and allow the two operations to pursue their different strategies.
Today’s figures reveal that the 3,000 core pubs that will be kept as part of the Punch business saw net income decline by 5.3 per cent in the half-year, whereas the pubs that are to be offloaded over the next three to five years suffered an 11 per cent decline.
The Spirit division saw underlying profits increase by five per cent to £67 million.
The group closed a total of 190 under-performing pubs over the six months for a profit of £5 million.