Fuller’s posts £22m loss in half-year results

Pub group Fuller’s has posted a loss of over £22 million in the first half of the year, and has reduced its workforce by 20% since April.

Fuller’s posted its half-year results, which cover the 26 weeks to 26 September 2020, yesterday. Group revenue fell by 72.7% to £45.6 million, and the pub company recorded an adjusted loss of £22.2 million, £16.3m of which was incurred during the 14 weeks of lockdown.

Chief executive Simon Emeny said the company’s position at the start of the pandemic, bolstered by the sale of its beer division to Asahi in 2019, has aided its survival.

He said: “We entered this crisis in a position of strength, buoyed by the sale of the Fuller’s beer business. We have used the time and space created by the pandemic wisely – completing targeted investments in our estate, rightsizing our teams and utilising the support available to manage our cash reserves where possible. It has not been easy, but prudent financial management, an estate that is 92% freehold, and a strong balance sheet mean that we will be in the best possible position to get back on a growth trajectory.”

Despite this, the company confirmed staff numbers were down by 20% on the levels at the start of the financial year, the equivalent of around 350 jobs.

Fuller’s chairman Michael Turner said it had been an “incredibly challenging six months” for the company.

“The rollercoaster of emotions from closure, to reopening, through the well-designed and inspired Eat Out to Help Out scheme and then back down into a quagmire of increasingly onerous restrictions, tier alert levels and finally back to temporary closure, has been tough on our business and even tougher on our people,” he said.

“The government has been supportive and destructive in almost equal measure – but we are grateful for the recent extension of the furlough scheme. We urge the Chancellor to follow this with extensions to the business rates holiday and the VAT reduction. In the short term, we need clarity of message and a clear roadmap out of the coronavirus crisis.”

Fuller’s management confirmed it had prepared a “stress case”, working on the basis that the tier system will last for a further three months with no government support in addition to what has already been announced. It predicted that pre-coronavirus sales levels will not be achieved until FY23.

Mitchells & Butlers, which owns chains including All Bar One, Toby Carvery and Harvester, also recorded an annual loss of £132m in the year to 26 September. Revenues fell by 34% to £1.48 billion, compared to £2.2bn achieved in FY19.

The company said in spite of government support, it was forced to make 1,300 members of staff redundant by the end of September, and has closed 20 of some 1,700 sites that it operates.

It follows news of the new tier system in England, due to come into force from 2 December. 

The British Beer and Pub Association estimates that 30,000 pubs in England will either be forced to remain closed or be rendered unviable as 99% of the country is placed in the top two tiers of restrictions. According to the chief executive of trade body UKHospitality, Kate Nicholls, 70% of all hospitality businesses fall under tier 2, with the restrictions rendering 89% of them financially “unviable”. A further 22% come under tier 3, with just 6% of the businesses deemed to be “viable”.