Maclay Inns see profits rise 19% after cost cuts

MACLAY Inns, which runs Edinburgh's Southsider pub and Glasgow's Three Judges, yesterday posted a 19 per cent rise in underlying operating profits as it cut costs to meet "fragile demand".

The company, which operates 26 pubs, reported a 2 per cent rise in turnover to 10.4 million in the year to 3 October, with operating profits hitting 740,000.

Managing director Steve Mallon told The Scotsman that he sold one pub last year but was looking to take on up to five premises.

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The acquisitions will come through Thistle Pubco II and III, two enterprise investment scheme companies set up with City broker Cenkos, which is raising a further 1.7m to fund the purchases.

Mallon said he was already running the rule over a couple of bars and that his preference would be for further acquisitions to be close to his existing premises.

"2009 was a difficult year for the trade in Scotland," he said. "Fragile demand due to the recession made turnover growth difficult to achieve. Underlying pressure on costs added further challenges to profits. However, the team at Maclay Inns responded magnificently and delivered sales growth and cost reductions.

"The outlook for 2010 remains challenging, but confidence is rising and we anticipate a good year ahead of us. We've not had to close any pubs over the past year because we've been focusing on the quality of our premises, especially the food."