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Charles Wells Ltd Results

7th January 2011

 Charles Wells Ltd announces an operating profit (pre-exceptional costs) for the year to September 2010 of £11m up 7.9% and a net profit before tax of £9.3m (up from £3m last year following the write-down of the distribution centre.)

 The Charles Wells pubs, which numbered 251 tenanted and leased pubs at the year end, showed EBITDA rising 15% following a £25m investment in 2009. Twelve pubs were sold and four were re-opened following refurbishment.

 In Wells and Young’s Brewing Company, EBITDA (before exceptional costs) has been maintained at £11m. Wells and Young’s total beer sales were up 0.8% in a declining market.

 The John Bull managed pubs in France continue to contribute well to group profits and now number seven sites with the Robin Hood, Montpellier, opening in May 2010. Sales in this small chain are up 19%.

 After the year-end, Wells and Young’s announced the departure of Corona Extra from the brand portfolio with effect from December 2010. The brewery has taken steps to secure the long-term stability going forward. The cost base has been lowered and Wells and Young’s Brewing Company will soon be debt free.

 The vacated distribution centre in Bedford, the value of which was written down last year, has now been let on a long-term commercial basis.

Paul Wells, CEO said:

“We have delivered these improved profits despite a year of challenges from the economy and a declining beer market. An operating profit of £11m is a strong performance and is a reflection of everyone’s hard work.

“We spent the year integrating the 31 pubs which we purchased in 2009, and we re-opened four refurbished pubs. This led to the EBITDA per pub increasing by 15% which reflects the steady improvements in the quality of the estate.

“We launched two new beers to the UK market – Young’s London Gold, which is the third permanent Young’s beer, and Mongoose Premium Beer, a beer primarily for the Indian restaurant market and one which reflects our expertise at brewing Indian beers. We also signed a distribution agreement with the Spanish brewer Grupo Damm to import, market and distribute their flagship Estrella Damm premium lager.

“Wells and Young’s focus is of course cask beer, and this year has seen national advertising and significant marketing investment across our core range of cask beers Bombardier, Young’s, Courage and Eagle.

“Further afield, both Wells and Young’s export division and the John Bull Pub Company contributed well to group profit. Export grew by 3.3% and although we are continuing our focus in established markets such as Canada and France, we are also seeing promising growth in developing markets such as Sweden and Russia. The John Bull Pub Company, the group of pubs in France, opened its seventh site and reverted all the French sites to managed pubs.

“These are the last results with a full year of contribution from Corona Extra. We are proud to have built this brand from 50,000 cases in 1995 to a peak of five million.

“The duty escalator is still a major concern for the industry and with the VAT increase to 20% now in place there are significant increased pressures on the Great British pub. Last year I urged the Chancellor to realise the vital role played by pubs in their local economies – and I do the same this year. Pubs can only take so much, and we are in danger of losing hundreds of great pubs because of the tax burden placed on them. Pubs are at the absolute heart of their communities and part of the fabric of UK society.”

Paul Wells, CEO, says these improved results were delivered despite a year of challenges from the economy and a declining market.

Young's London Gold was launched in 2010 and is the third permanent cask beer in the Young's range.


The Park in Bedford, is one of the Charles Wells pubs re-opened in 2010 following refurbishment.