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Despite positive H1 results, concerns about Greene King remain

Published:  04 December, 2014

Total revenue was up 3.3% rising to £614.9 million for the first half of 2015 fiscal year for pub company and brewer Greene King, but its operating profit dropped 3.1% to £123.3 million.

The pub chain's chief executive Rooney Anand cited the sluggish UK economy and particularly the lack of growth in real wages as a major challenge for retailers and the on-trade.

Anand said: "With real income struggling to grow, customers remain cautious about spending on eating out and drinking out."

Leading into the festive period the cautious nature of consumer spending in the on-trade is a concern, but bookings for Christmas across the chain are up 7.2%.

Joshua Raymond, chief market strategist at, said:  "This is not a stellar set of results and there remains a degree of concern over slowing sales growth and how weak earnings and food price deflation is having on margins and sales volume."

Christmas does not look extraordinarily bright this year based on Greene King's own research. The company found that for the festive trading period that more consumers were planning on spending less on food and drinks in the on-trade than last year.

Based on Greene King's findings which were released at the end of last month, Steve Jebson, Greene King's commercial director, said: "It has been another tough month for leisure spend, falling 10% compared to October last year. With Christmas just around the corner, Brits yet again limited their leisure spend last month. And, with consumer confidence still fragile, it is not surprising that many are hesitant to loosen the purse strings."

The company has seen some highs and lows on the stock market as well this year. In the start of 2014, Greene King (GNK) was trading well above £900 per share mark, today the stock opened at £765.50

"Greene King shares have been on a continual slide this year and are currently down 14% in 2014 thus far," said Raymond.

Greene King has reportedly agreed to buy Spirit Pub Company last month for £774 million, but the deal has not yet been approved by shareholders.