Pub's sales go down the tubes

Pubs group Marston's said it would absorb rises in the cost of lager as it seeks to protect its tenanted and leased outlets in a "difficult" market.

The firm said pubs in its Marston's Pubs Company had seen like-for-like sales drop by around 6% in the 15 weeks to January 17.

It said it would look to help its tenants and lessees by mitigating the impact of "substantial price increases" from the major lager brewers and would not be raising the cost of its own beers - which include Pedigree, Burton Bitter and Banks - until autumn at the earliest.

Marston's said it would also look at ways to stimulate business, including more flexible agreements and rent alleviation.

"In a difficult trading environment our emphasis over the first quarter has been on continuing to offer our customers exceptional value for money and good service, on promoting a sustainable and fair basis for our dealings with tenants and lessees, and on the tight control of costs," Marston's said.

The company has around 2,250 pubs and bars in England and Wales, including 506 managed pubs under the brands Tavern Table, Two for One and Pitcher & Piano. It employs around 12,000 people.

A spokesman for Marston's said the company had decided to freeze beer and lager prices to "keep tenants in place and maintain the stability of the estate".

The company said the move would protect sales and margins in a "competitive environment".

At Marston's Inns & Taverns, the company's managed pub division, like-for-like sales for the period were 2.9% below last year. Trading over Christmas and New Year showed a slight improvement compared to recent trends, but business since then has been more subdued.

The brewing side of the business increased volumes on last year, helped by the acquisition of Oxfordshire-based Wychwood Brewery in April.