Fuller, Smith & Turner (LSE:FSTA) now expects adjusted pre-tax profit for the full year to come in ahead of current market expectations, after first-half profit rose 25% on strong summer trading and World Cup demand.
The London-focused pubs and hotels group, which runs 194 managed pubs and hotels alongside 153 tenanted inns across the southern half of England, reported adjusted profit before tax of £28.2m for the 26 weeks to 26 September, up from £22.5m a year earlier.
Revenue rose 6.5% to £220.9m from £207.5m, driven by like-for-like sales growth of 6.1% across its managed pubs and hotels, which the company said outperformed the market by 3 percentage points.
Statutory profit before tax came in at £28.5m, against £21.1m in the comparative period.
Adjusted earnings per share climbed 33% to 39.81p from 30.03p, boosted by the ongoing share buyback alongside the profit growth.
Drink like-for-like sales rose 6.4%, food increased 4.6% and accommodation grew 8.9%, with revenue per available room up 9.3%.
Within the managed estate, EBITDA margin widened to 25.1% from 23.5%, with the company citing procurement gains, labour efficiency and modest price increases mitigating some of the roughly £5m of annualised cost from National Living Wage increases.
The group said exceptional summer weather and the football World Cup added an estimated £2m to £3m of incremental profit to the managed business in the period.
During the half, Fuller's exchanged contracts to acquire 12 pubs for £37.5m before fees, at a multiple of 7.9 times acquired site EBITDA; nine of the sites, including The Shipwrights Arms at London Bridge and The Duchess by Selfridges, have joined the managed estate, with three joining the tenanted business.
Net debt excluding lease liabilities stood at £140.2m, up from £138.3m a year earlier, and the company said this is expected to rise further in the second half to fund the recent pub acquisitions.
The group invested £14.2m in its existing estate during the half and returned £15.2m to shareholders through dividends and buybacks, including 1.1m 'A' shares repurchased, with a further one million shares planned once the current buyback programme completes.
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The board declared an interim dividend of 8.35p per 'A' and 'C' ordinary share, up 6% from 7.85p, payable on 4 January.
"With such a strong start, we are confident that we will exceed current market expectations for the full year," said executive chairman Simon Emeny.
Like-for-like sales for the 32 weeks to 7 November were up 5.8%, and the company said Christmas bookings are running 16% ahead of the comparable period last year.
Fuller's plans to invest a further £19m across its estate in the second half, including adding bedrooms at The Barrowboy & Banker on London Bridge.
The company confirmed finance director Neil Smith will step down on 30 November, succeeded by chief financial officer designate Katie Horner, while Richard Fuller will retire from the board on 31 January after a 42-year career with the group.
Full-year results for FY2027 are due on 9 June 2027.