Afternoon:
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The boss of London's best-run pubs group today made an impassioned plea for the “beer tie” not to be referred to the Competition Commission.
“The last thing this industry needs at the moment is an awful lot of uncertainty and everything on hold for a two-and-a-half-year investigation,” said Michael Turner, chairman of the Fuller Smith & Turner pub company, which also brews London Pride in Chiswick.
The beer tie is a pub-industry ownership structure in which tenants are tied to taking their beer and drinks from their pub company landlord in return for a more attractive rent.
The tie, which affects 30,000 British pubs, has been thrown into disrepute because of the rapacious deals of some of the large pub companies whose estates run into thousands of pubs. Business Secretary Lord Mandelson is considering whether to refer the tie to the Competition Commission.
“That would be the 19th investigation of the tie since 1966,” said Turner. “We are already an over-regulated industry and we do not need more legislation. We do not need interference. It is something the industry should be left alone to sort out.”
Current like-for-like sales growth at Fuller's managed pubs is running at 1.8% though it is down 2% in the company's tenanted outlets.
Underlying pre-tax profits are flat though the bottom line tumbled 40% to £14.4 million in the year to the end of March after writedowns in the value of previously acquired pubs.
“This is a good performance and shows we are taking market share,” said Turner.
The dividend is up 0.1p to 7p.
