British pub group Marston's announced on Wednesday that it expects a significant reduction in its net debt and reported that its annual like-for-like (LFL) sales growth has outpaced the broader
market, driven by steady demand for its drinks and food offerings.
Why It Matters
Despite strong sales momentum, partly fueled by increased customer spending and excitement around the upcoming Euro 2024 championship, Marston's continues to grapple with a substantial debt burden of over £1 billion. This debt is more than four times the company's market value.
As of October 9, Marston's had a market capitalization of £271.3 million ($354.97 million), according to LSEG data.
Background
Based in Wolverhampton, Marston's has been selling off pubs in an effort to reduce its debt. In July, the company sold its 40% stake in the joint venture Carlsberg Marston's Limited to Carlsberg for £206 million. Additionally, in May, Marston's announced plans to sell £50 million worth of unlicensed properties by the end of the financial year.
By the Numbers
For the 52-week period ending September 28, Marston's posted a 4.8% rise in LFL sales, outperforming the managed pub sector's average growth of 4%, according to Peel Hunt.
What's Next?
Marston's expects to report profit in line with market expectations during its preliminary 2024 results, set for December 3. The company projects its net debt, excluding IFRS 16 lease liabilities, to stand at approximately £885 million for fiscal 2024, down from the £1.16 billion reported at the end of the first half of the year. Photo by Roger Kidd, Wikimedia commons.