Belhaven brews up a strong rise for Greene King

Published on Wednesday 6 December 2006 00:37

A VIGOROUS performance by its Scottish Belhaven division helped to drive a strong interim profits performance at major British regional brewer Greene King.

GK said Belhaven, acquired last year, saw comparative profits rise 8 per cent to 11.5 million, although in the same period last year the Scottish company was only with the group for two months after its acquisition.

Rooney Anand, GK's chief executive, said Belhaven's like-for-like sales were down 2.6 per cent in the period, although food sales were up "in the double digits". He said the integration, under the stewardship of Belhaven's managing director, Stuart Ross, had gone very smoothly.

Overall, Belhaven's revenues rose to 55.8m (54.9m). Anand said trading at Belhaven, which has about 300 mostly urban Scottish pubs, had "been encouraging considering the impact of the Scottish smoking ban, introduced in March.

"Although it is still early days, and we will not know the full impact of the smoking ban until we have lived through at least one winter, I remain cautiously optimistic."

Anand added: "I have been pleasantly surprised at the reaction to the ban. We had some very hardened licensees who were vehemently against it who have admitted pubs are a better place to be since the ban."

Belhaven's performance helped GK, one of the drinks industries most acquisitive companies, drive group pre-tax profits up 20 per cent to 67m in the 24 weeks to 15 October, 2006.

Group revenues lifted 16 per cent to 419.2m and the interim dividend climbs 11 per cent to 6.45p. Brewing profits at GK, whose best-known brands include Belhaven Best, Abbot Ale and Greene King, edged up 2 per cent to 10m. This was due to a better profit margin as the division's revenues were flat at 40.9m.

Anand said this was partly due to an unusually hot summer, combined with the effects of the football World Cup, leading to "a marked switch from ale to lager, in both the on-trade and the off-trade".

However, Belhaven Best in Scotland was one of the better performers, with volumes up 5 per cent.

Speckled Hen was relaunched in August in an attempt to broaden its appeal to drinkers, while Greene King IPA has become the official beer of England Rugby - the company's biggest ever sponsorship deal.

The group said Nottinghamshire-based Hardys & Hansons, which it acquired on 5 September, was also performing well.

GK now has 2,000 pubs after also recently buying historic Essex brewer Ridley's.