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Pub owner Young's shrugs off high street 'doom and gloom'

Pub owner Young’s has shrugged off "doom and gloom" around consumer spending and Brexit with another year of sales growth and an increase to its dividend. 
Chief executive Patrick Dardis cheered what he called “industry-leading” sales growth of 6.2pc, with turnover hitting ?279.3m in the year to April 2. Like-for-like revenue, measuring sites open more than a year, rose 4.2pc.
The company credited 89pc growth in demand for Aperol Spritz and the popularity of its Burger Shack concept, now in 35 of its 175 sites.
Young's increased shareholder payouts by 6pc to 19.6p a share, the 21st consecutive rise the company has delivered.
Mr Dardis boss acknowledged the pessimism surrounding consumer spending on the high street and pressure on the hospitality sector caused by rising business rates and the National Living Wage, but said his company had proved challenges could be overcome.
“I think we can get carried away with the doom and gloom of Brexit, sterling’s weakness and the health of the consumer,” he said.
Pub owner Young's shrugs off high street 'doom and gloom'

Young's says its Sunday lunches have helped pull in customers in spite of the tough consumer outlook

Credit:
Young's
“But we have produced pretty strong numbers given the backdrop and feel confident we have sufficient levers to pull to keep going.”
Although its margins were slightly depressed due to rising costs, the company still managed a fractional rise in pre-tax profits to ?37.6m. The shares, which have more than doubled in the past five years to ?16.58, were relatively unmoved.
Mr Dardis said he had chosen not to engage in promotional offers, a trend that has become prominent in the casual dining sector as operators battle for customers.
“If you’re not driving the top line, then the bottom line is shafted,” he said.
“None of our sales are driven by promotion or discounting as we hold events and activities which bring customers in. In 2008/09 during the financial crisis, the level of discounting was brutal but we did not participate then and we got through it and emerged the other side.”
Mr Dardis added that a key factor behind the company’s success was that it owned the vast majority of its pubs rather than leasing sites.
He also stood by the decision to ramp up investment in the business in the face of the tough consumer outlook. The company usually puts around ?44m into capital expenditure but splashed ?53m during the year as it bought two hotels it plans to turn into pubs with accommodation.
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