Shepherd Neame sales and profits lift despite selling less beer

Pub and brewing firm Shepherd Neame has revealed record revenues and a jump in profits despite selling less of its beer over the past year.

The Kent-based firm said it shifted its beer business further away from retailers, such as supermarkets, over the year, resulting in a significant slump in sales volumes.

However, it said its pub-focused strategy has been encouraging after pub-drinking habits normalised following the impact of the pandemic and cost-of-living pressures.

The company, which employs around 1,800 people, revealed that revenues grew by 3.6% to a record £172.3 million over the year to June 29, compared with the previous year.

It said this was particularly driven by a strong performance by venues in London and its tenanted pub business.

Shepherd Neame, which operated 291 pubs at the end of the year, saw total like-for-like sales grow by 4.9% across its pub estate, driven by a 7.2% increase in drink sales.

Pubs within the M25 reported a 14.5% jump in like-for-like sales as the return of more office workers helped support sales.

Meanwhile, the Spitfire and Bishops Finger brewer said total beer volumes fell by 11.8% compared with the previous year, driving a 7.4% fall in revenues from its brewing and brands division.

The company said however that profits from its beer business grew as it pivoted from the off-trade, which means retailers including supermarkets, to on-trade customers, meaning hospitality operators such as pubs.

Shepherd Neame said that group pre-tax profits rose by 38.1% to £6.8 million for the year.

Jonathan Neame, chief executive of Shepherd Neame, said: “We have great beers and pubs, a strong balance sheet and a well-balanced and cash-generative business.

“We have a strong pipeline of pub developments and new opportunities in our heartland on-trade.

“We are optimistic about the consumer outlook and are well positioned for the future, notwithstanding the ongoing cost headwinds we face.”