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London trade ‘subdued’ and June 21 full reopening ‘critical’, Greene King boss warns

Naomi Ackerman
·3-min read
<p>Mackenzie said: “We only opened around 20% of our pubs in London and trading in those pubs compared to the rest of the country is more subdued.”</p> (PA)

Mackenzie said: “We only opened around 20% of our pubs in London and trading in those pubs compared to the rest of the country is more subdued.”

(PA)

Greene King's boss has warned that London pubs are seeing "subdued" trading compared to the rest of the country and urged Boris Johnson to provide the "critical" certainty of an unrestricted reopening on June 21.

Greene King has about 1,500 managed pubs and nearly 1,000 tenancies in the UK. Just 20% of its 151 managed pubs in London's Zones 1 and 2 are currently open.

Chief executive Nick Mackenzie told the Standard the group is currently taking around 30% of normal revenues, despite the "euphoria" seen on reopening.

Outdoor-only service restrictions in place until at least May 17 means that bad weather sees an average pub trade at 50% of normal levels "if you're lucky".

"The like-for-likes are distorted by the fact that very few pubs are actually open and everyone is piling into the same pub. We're not making any money, and we won't be able to reinvest until we have certainty post-June 21," Mackenzie said. "London particularly has been a real challenge. We only opened around 20% of our pubs in London and trading in those pubs compared to the rest of the country is more subdued.

"We need to get to June 21 where it is critical that they [government] do what they promised and we get back to unrestricted trading, where we can get back to having a drink standing up in a London pub again."

Mackenzie said he is "fundamentally" against "unworkable" vaccine passports - the group's latest survey found 26% of respondents would not go to the pub if a vaccine passports were required - and said that if such restrictions remain in place from June 21, further Government support will be needed for the sector.

Footfall in the City and West End has been hit by travel restrictions and work-from-home directives. The pub chief urged the Mayor's office, Westminster and local government "to come together with the industry and say 'right, how are we going to get people back into city centres?'"

Many chief executives are now eyeing a future hybrid working model, which would see office workers in town two or three days a week. Mackenzie admitted that a flexi-working future will "put an extra pressure" on city centre pubs, but said that hospitality will be able to "adapt" to shifting consumer behaviour.

The comments came as Greene King, which has made 607 redundancies since the pandemic hit, reported a statutory pre-tax loss of £248.6 million for the 36 weeks to January 3. Revenues were down 63.4% to £562.1 million.

The company, which was sold to CK Asset Holdings - held by Hong Kong-based billionaire Li Ka-shing - in 2019 in a £4.6 billion takeover deal, gave its tenants rent relief in the period, at a cost of £27 million.

Mackenzie labelled the financial period "extremely challenging".

“We have used the time through lockdown to make progress on our strategic priorities – which include growing sales through compelling brands, improving the customer experience, and investing in digital. The second half of this year will be pivotal for us in terms of rebuilding the business," he said.

"I am confident for the medium to long term of the sector, because it always has been a survivor. One of the things we have found on the reopening is that people have reconnected with the pub again... That can only be a good thing."

Also on Tuesday, AIM-listed hospitality firm Nightcap, which floated at 10p per share in January, said it has agreed to buy Adventure Bar Group.

The firm it is acquiring has nine sites and is behind brands including Blame Gloria in Covent Garden.

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