Pub chain Marston's says Scottish sites more significantly impacted by Omicron
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The firm said like-for-like sales had been rising and were up 1.3 per cent in the eight weeks to November 27, but they fell sharply in the following eight weeks to January 12 as the virus spread - falling 8.8 per cent compared with the same period two years ago.
In total, like-for-like sales for the 16-week period were down 3.9 per cent.
Releasing a trading update to investors, the group said the falls reflected “the impact of the Omicron variant and consumer sentiment related to the new variant... as a result of government messaging including guidance to work from home and the call to limit social distancing”.
During the five weeks of December, like-for-like sales compared with the market outside London’s M25 motorway were 1 per cent ahead and total sales were 5 per cent ahead.
Marston’s has 21 sites north of the Border after building up its presence in Scotland in recent years.
Chief executive Andrew Andrea said: “Whilst the emergence of the Omicron variant and subsequent government guidance temporarily impacted consumer sentiment, we remain confident that the strong trading momentum which we were experiencing prior to that will resume.
“We welcome the various plans underway to gradually ease trading restrictions in Scotland and Wales. These, together with the reduction in the required self-isolation period and anticipation of an imminent end to the work from home directive, should enable some semblance of normalised trading patterns to return.
“Indeed, there is growing evidence over the most recent of weeks of the new year that consumer confidence is rebuilding, and guests are returning to our pubs in greater numbers, which is encouraging.
“Importantly, Marston's has a well invested, predominantly community pub estate which is well placed to benefit from the pent-up consumer demand which we are confident remains.”
Greg Johnson, an analyst at brokerage Shore Capital, said: “The period is a tale of two halves, with the first eight weeks ahead by 1.3 per cent, and the second eight weeks, covering the December and festive period, impacted by enhanced restrictions and a more cautious consumer backdrop, down 8.8 per cent.
“We see this swing versus previous trends as consistent with our expectations, and that the fallout from Omicron may not be as bad as feared when restrictions were first imposed.
“We understand that sales have started to recover over the last couple of weeks, although nearly a fifth of the estate is in Scotland and Wales, which suffered tighter restrictions.
“Encouragingly, total sales declined by 3.6 per cent, consistent with like-for-like sales, with the estate remaining open throughout,” he added. “Despite previously flagged VAT and duty payments in the first quarter, the group was cash flow positive in the period.”