Greene King to close brewery in pounds 14m revamp

Greene King, the Bury St Edmunds-based brewer of IPA and Abbot Ale, is to shut its Biggleswade brewery at the cost of 132 jobs unless it can sell the site as a going concern. The shutdown was announced yesterday as part of restructuring of the Suffolk company's brewing operation that will result in a pounds 14m charge being taken against full-year results.

The package of changes, which also includes three distribution depot closures, accompanied half-year results which showed a 38 per cent rise in pre-exceptional profits for the 24 weeks to October. It is part of a focus on Greene King's core ales, which now also include Wexford Irish Cream Ale, and its fast-growing retail estate, where new concepts such as Ale Cafe and Hungry Horse are being rolled out.

The closure of Biggleswade means that brewery's distribution site will also close, along with others at Norwich and Furneux Pelham. Tim Bridge, chief executive, said the job losses would be more than offset by the creation of 300 new jobs in its retail arm this year, followed by a similar number next year.

Greene King's profits were boosted by a first time contribution from the Magic Pub company, which was included for 15 weeks in the first-half result. The acquisition of Magic, for pounds 200m in July, took Greene King's pub estate to more than 1,100 and means the company now makes more than half its profits from retailing.

Mr Bridge said he was pleased with the acquisition, which made a pounds 70m fortune for founder Michael Cannon, but represented only pounds 700,000 a pub, low by the standards of recent pub chain deals.

Including the Magic contribution, sales jumped 41 per cent in the period from pounds 76.1m to pounds 107.6m. Trading profit was more than 50 per cent better at pounds 20.4m, while profit before tax grew 21 per cent to pounds 13.4m (pounds 11.1m). After a 5 per cent increase in earnings per share to 18.8p, an interim dividend of 4.75p was recommended, a 12 per cent increase.

Mr Bridge said Greene King was on track to deliver synergy benefits of pounds 3m from the acquisition of Magic Pub, thanks to greater purchasing power, the sale of Greene King ales through the enlarged chain and reductions in overheads.

Magic Pub contributed pounds 6m of trading profit in the period, slightly less than the pounds 7.2m generated in the full six-month period by the existing retail estate, a 12 per cent rise. Tenanted pubs increased by 4 per cent to pounds 8m, while higher marketing costs reduced the brewing contribution to pounds 3m (pounds 3.2m).

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Day In a Page

John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy
UK heatwave: Temperature reaches 39.8 degrees on Central Line - the sweatiest place in London

39.8 degrees recorded on Tube

There's hot (London) and too damn hot (the Underground). Simon Usborne braved the Central line to discover what its passengers suffer
Kitchens go hi-tech: From robot chefs to recipe-shopping apps, computerised cooking is coming

Computerised cooking is coming

From apps that automatically make shopping lists from your recipe books to smart ovens and robot chefs, Kevin Maney rounds up innovations to make your mouth water
Jessie Cave interview: The Harry Potter star has published a feminist collection of cartoons

Jessie Cave's feminist cartoons

The Harry Potter star tells Alice Jones how a one-night stand changed her life
Football Beyond Borders: Even the most distruptive pupils score at homework club

Education: Football Beyond Borders

Add football to an after-school homework club, and even the naughtiest boys can score
10 best barbecue books

Fire up the barbie: 10 best barbecue books

We've got Bibles to get you grilling and smoking like a true south American pro
Wimbledon 2015: Nick Bollettieri - Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power

Nick Bollettieri's Wimbledon Files

Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power
Ron Dennis exclusive: ‘This is one of the best McLaren teams ever – we are going to do it’

‘This is one of the best McLaren teams ever – we are going to do it’

Ron Dennis shrugs off a poor start to the season in an exclusive interview, and says the glory days will come back
Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most