Britain’s oldest brewer Shepherd Neame warns over hit to margins from inflationary pressures but sees recovery in sales and profit
- Shepherd Neame has seen profits and sales rise in the past few months
- But group warned its margins look set to be hit amid inflationary pressures
Shepherd Neame has warned it expects a hit to margins from inflationary pressures in the coming months.
Boss Jonathan Neame, said: ‘Our business is in good shape and has traded well following the lifting of all restrictions. However, the current economic uncertainties are putting inflationary pressure on the sector which will impact margins.’
But, the group, which is Britain’s oldest brewer, reported a strong pandemic rebound with revenue hitting pre-pandemic half-year levels.
In charge: Jonathan Neame is the chief executive of Shepherd Neame
Sales hit £78.7million, representing an increase of more than half versus the year before, while underlying EBITDA stood at £11.3million.
The brewer said most of its central London pubs were nearing normal sales after pandemic restrictions were eased.
The hike in back-to-work footfall has aided a booming recovery for the capital’s venues.
The group said like-for-like sales were 110 per cent for the 13 weeks to 26 March, compared to an equivalent period in 2021.
The group has also announced plans to restart dividend payments again.
Mr Neame said: ‘I am delighted that the Board feels our recovery is sufficiently well established for it to be able to declare the first dividend since October 2019 of 3.50p per share.
‘While this is below the level of the last interim dividend paid by the Company in early 2019, it is a statement of confidence that a degree of normality has returned and that, subject of course to economic and medical vagaries, we are firmly on the way back to prospering as a company for all our stakeholders.’
The dividend will be paid on 22 April 2022 to those shareholders on the register at 8 April 2022.
Mr Neame added: ‘I am pleased to report a strong rebound in the first half of the year despite ongoing restrictions and operational challenges during the period.
‘We are now back to pre-pandemic trading levels, have strong cash flow and have returned to profitability.’
He added: ‘We have a robust and resilient business and a strong platform from which to build. We move forward with confidence and are pleased that we can now resume investment across our business at pre-pandemic levels. To support this we have strengthened our management team with a highly experienced and proven operator to help take the pub business forward.
‘We are looking to the future with cautious optimism and are excited about delivering an uninterrupted Easter and summer for the first time in three years.’
Established in 1698 and based in Faversham, Kent, Shepherd Neame employs around 1,500 people.
The group brews, markets and distributes its own beers to national and export customers under a range of brand names including Spitfire and Bishops Finger, as well as newer brands, like Whitstable Bay, Bear Island and Orchard View Cider.