McMullens FY pre-tax profits rise 34.4% to £16.4m

Brewery and pub operator, McMullen’s, has reported that its profits before corporation tax jumped by 34.4% to £16.4m in the year to 28 September 2024, due to a strong performance in its retail division. 

While the group has stated that, in nominal terms, its profit performance now exceeds pre-pandemic levels, McMullen’s real-term recovery after inflation continues. 

McMullen’s is the latest pub operator to warn that the government’s recent Autumn Budget changes will create additional challenges to its business. 

Despite “disappointing” summer weather, the group’s retail division saw its turnover rise 8.1% to £115m in the year to September 2024. 

McMullen’s saw strong revenue across their pub portfolio. This included both large, recently renovated London locations, whose performance was boosted by investment, and smaller local pubs. These smaller sites excelled due to dedicated staff who increased sales by consistently providing customers with a valued offering.

Turnover growth resulted from strategic investments and acquisitions, including Salisbury, Princess Charlotte, Saint and Sinner, and Fisherman. The 2024 acquisition of Lock Tavern, coupled with investments in Three Horseshoes and Crocodile, further propelled this increase. Both wet-led sales, totalling £66m, and food sales, at £44m, saw over 7% growth. On a comparable basis, wet-led sales rose by 4.2% and food sales by 6.4%.

Beer volumes in McMullen’s tenant-run pubs rose by 2.7% in total and by 6.6% at the 30 comparable pubs in the estate. The most notable growth was seen at the Rose and Crown in Ware, where a con-investment with a new tenant has transformed the pub garden. 

Wet-led income for the estate increased by 10.3% year-over-year, after all discounts. Notably, 80% of comparable pubs saw a rise in wholesale margins. Regionally, Country volumes grew by 11%, and Rivertown’s volumes increased by 4.6%.

However, McMullen’s observed that, due to necessary price hikes inevitably lowering demand, many locations experienced a dip in food customers, with comparable customer numbers falling by 1.4%. Destination and Chicken and Grill pubs saw a “significant” impact.

Disappointment was voiced by the group regarding the government’s economic growth initiative. It said it found the strategy for achieving this, especially within the hospitality industry, “unclear”.

McMullen added that placing additional financial burdens on businesses through taxes and labour costs “creates a conflict with the objective of fostering business growth”.

Despite existing challenges, the group maintains it is in a “strong position to overcome them due to its robust and expanding financial status, substantial investments in freehold pubs, and capable senior leadership”.