Greene King is looking forward to a merry Christmas but expects more challenging times in 2011.
The brewer and pub owner has reported a 17% increase in half year profits to £62.4m, helped by its strategy (not unique in the sector) of concentrating on growing food sales. It also plans to reduce the number of tenanted and leased businesses. It also plans to fully integrate Bellhaven, bought in 2005, into its existing operations to save £1m a year. It said current trading remained strong, with Christmas bookings comfortably ahead of last year, and despite the difficult outlook for next year, it was confident of trading well and delivering good results. Its shares have climbed 2.8p to 462.8p. Nigel Parson at Evolution Securities said:
Greene King is performing increasingly well into an increasingly tough trading environment. Next year's outlook is like today's weather: wintery but its dividend should act as an overcoat. The 6.8% increase in the dividend which yields 4.9% should warm the hearts (and pockets) of investors.
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