Shepherd Neame reports trade back to pre-pandemic levels, returns to profit: Kent-based brewer and retailer Shepherd Neame has reported sales have picked up “significantly” since the lifting of “Plan B” restrictions with trade now back at pre-pandemic levels. Sales in its managed pubs and hotels for the 13 weeks to 26 March 2022 were at 110% of 2020 levels. For the nine weeks to 26 February 2022, like-for-like tenanted income was 97% of 2020. The company, which operates 302 pubs, also reported a return to profit and the payment of an interim dividend. The company stated: “The aftermath of this crisis will continue to impact us for a while yet, as it is likely that consumers will be affected by the inflationary pressures facing the economy and that disposable income will be squeezed. Further, we now face a new crisis in Ukraine which will create greater uncertainty and higher inflation. If this inflation becomes embedded, it will become more important than ever that we drive great service and premium experiences to ensure that our offer remains competitive for the long term. We have rebuilt a strong platform for the company and look forward to the future with optimism. However, consumer confidence is expected to remain fragile. We must remain agile whilst focusing on taking the right decisions for the long term health of the business.” Revenue for the 26 weeks ending 25 December 2021 has recovered to the same level as the first half of financial year 2020 with £78.7m of sales. Underlying Ebitda rose substantially to £11.3m (first half of 2021 restated: £3.4m). Statutory profit before tax was £5.4m (first half of 2021 restated: loss of £7.2m). Like-for-like retail sales were 89% of 2020 in the 26 weeks, but more than 100% in restriction free periods. It said most central London pubs were trading near normal as back to work footfall increases. An interim dividend of 3.50p declared – the first dividend since October 2019. Shepherd Neame said it had successfully remobilised the business after the disruption of the pandemic and recovered demand. Net debt excluding lease liabilities as at 25 December 2021 was £82.4m (£92.5m at 26 December 2020). The business paid all the remaining VAT liabilities to HM Revenue & Customs by the end of January 2022 and all deferred rent payments. Net debt excluding lease liabilities as at 26 March 2022 was £78.5m. A Coronavirus Large Business Interruption Loan of £25m taken out at the start of the pandemic has now been retired and the company is performing within pre-pandemic financial covenants. As previously reported, the company has appointed Jonathon Swaine as managing director of its pubs division, who joins in the summer. Chief executive Jonathan Neame said: “I am pleased to report a strong rebound in the first half of the year despite ongoing restrictions and operational challenges during the period. We are now back to pre-pandemic trading levels, have strong cash flow and have returned to profitability. Our business is in good shape and has traded well following the lifting of all restrictions. However, the current economic uncertainties are putting inflationary pressure on the sector which will impact margins. We have a robust and resilient business and a strong platform from which to build. We move forward with confidence and are pleased that we can now resume investment across our business at pre-pandemic levels. To support this we have strengthened our management team with a highly experienced and proven operator to help take the pub business forward. We are looking to the future with cautious optimism and are excited about delivering an uninterrupted Easter and summer for the first time in three years.”