Pub giant Young's boosts dividend following surge in earnings
In a surprising turn of events, pub and bar operator Young & Co's has managed to boost its earnings, even with costs skyrocketing. This lively brewery business, adorning 277 pubs across the UK, shared its results from the last financial year, which extended from April 2022 to March 2023.
According to the information disclosed, revenue escalated a whopping 24.9% from £388.8m to a staggering £485.8m. The nearly 200-year-old brewery reported a 24.6% rise in adjusted operating profit, which went from £57.3m to an impressive £71.4m. Earnings before interest, tax, depreciation, and amortization (EBITDA) also saw a 23.2% boost.
However, the adjusted profit before tax advanced only 4.5%, reaching £51.6m, due to the substantial hike in the National Living Wage (up nearly 10%) and increased utility costs. Despite these challenges, the company decided to enhance its dividend by a substantial 6%, making the total dividend for the year 23.06p.
Young's Beaming with Optimism
Simon Dodds, chief executive of the thriving chain, expressed his confidence in the company's strong standing, stating that Young's was "in excellent shape" and "well-equipped to navigate turbulent conditions." The acclaimed executive added that the company continued to lead in like-for-like sales in the sector and everything seemed to be progressing in the right direction.
The hospitality industry has grappled with low consumer confidence and mounting taxes. Despite these hurdles, the industry's resilience, particularly from large chains, has been bolstered by persistently high demand for food and drink. While Dodds acknowledged the prevailing headwinds impacting consumers and the broader challenges facing the industry, he expressed optimism that the company's premium, investment-worthy, predominantly freehold pub estate would keep driving profitable growth.
City Pub Group IntegrationBoosts Growth
The amalgamation of City Pub Group played a crucial role in fueling growth during the financial year. This merger brought 50 pubs and over 200 hotel rooms into Young's fold. Young's finalized the acquisition of City Pub Group for a hefty £162m in November 2023, although the transaction wasn't formally completed until March 2022 and was only fully integrated into Young's during the second half of the financial year.
The company invested £6m to upgrade the newly acquired pubs from City, along with £41m in renovating its existing estate. While it's unclear how the acquisition impacted the financial year ending March 31, 2023, the overall strategy and operational performance of younger companies suggest that strategic mergers can lead to substantial growth when executed effectively.
[1] Young & Co financial results for March 31, 2025 (source: Young & Co's official financial report)
[2] Young & Co financial performance, including EURO24 and Christmas period (source: various media reports)
- In the ever-evolving landscape of finance and general-news, Young & Co's continued growth amidst soaring costs is noteworthy, indicating a promising outlook for the brewery business and the wider hospitality industry.
- The integration of City Pub Group significantly boosted Young & Co's growth during the 2022-23 financial year, adding 50 pubs and over 200 hotel rooms to its portfolio. Strategic mergers, as demonstrated by Young & Co, can lead to substantial expansion when executed effectively.
- As Young & Co continues to lead in like-for-like sales in the sector and enhance its dividend, Simon Dodds, the company's CEO, remains optimistic about their prospects, stating that the company is "in excellent shape" and well-equipped to navigate turbulent conditions in the future.
