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Tue 6th Jan 2015 - Arkell's laments "bread and butter is over" as it reports results
Arkell’s reports turnover and profit boost: Swindon-based brewer and retailer Arkell’s has reported turnover grew by 6.4% to £19.861m in the year ended 31 March 2014. Profit before tax rose by 2.9% to £1.935m, including an exceptional item of £493,000 arising from the profit on the sale of a property. Pre-exceptional profit before tax of £1.441m is around £950,000 lower than was achieved in 2010 on turnover that was circa £670,000 lower in that year. The main reason for the turnover rise in 2014 was an increase in the number of managed pubs operated by the business. Accommodation revenue grew by 42% due largely to the acquisition of the Angel Hotel, Royal Wootton Bassett and building rooms at the Sun Inn, Swindon. Tenancy rents fell slightly due to transfers to managed houses, but on a like-for-like basis increased by 2.6%. The company sold one pub at a profit of £493,000 and closed a further two pubs during the year. Chairman James Arkell said in the annual report: “Change is all around our business as our bread and butter for much of our 171 years is over. Profitability of our tenants has come under immense strain. For all our help, visits, guidance, investment and enthusiasm, the viability of many pubs is just not sustainable because of overheads (lighting, heating, wages, 20% VAT – thank goodness the beer escalator has been removed) and the anti-alcohol lobby, which is still very vocal. Also our core customers have changed. Social and financial pressures have moved them on, not away but on, to different spend priorities with other aspirational choices. Our major investments in pub rooms continues and in this year we built ten bedrooms at the Sun Inn, Coate. This again reinforces our commitment to increase the pubs’ footprint for profit, rooms, caravans, outside eating areas. Nothing is off limits. We have invested in our unlicensed estate – pubs which have declined in volume and profit would not (otherwise) attain a reasonable price. It’s not easy for our staff – delivering to ever-changing customer demands, taking orders with charm in difficult financial times and reacting daily circumstances. Nothing is easy anymore and we take most days as they come – so my thanks to all of them. So though not easy to produce ever-rising profits, we have a clear direction and investment programme. We will continue to churn properties for the enhancement of our pubs and estate.” A dividend of £520,000 was paid.


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