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Revenues increased 7.9% at the Greene King division that includes its off-trade activities but overall profits declined in the first half as under-pressure consumers stayed home more and ate out less.

The brewing and brands arm at the Old Speckled Hen owner recorded a £7.5m sales rise to £94.8m in the 24 weeks to 15 October as volumes nudged up 0.3%, against a total ale market that is down 3.4%.

Ongoing momentum in the free trade channel, improved trading in the take home channel, growing sales from innovation and increased marketing investment drove growth

However, operating profit was unchanged due to increased input costs and changes in sales channel and customer mix.

Group revenues fell 1.2% for the half to £1bn as sales at the pub company division tumbled 2.2% to £855.9m and its pub partners arm by 1.6% to £93.6m.

Greene King blamed the challenging first half on more cautious consumer spending and “unprecedented” cost pressures on the pub sector.

The group, which runs the Hungry Horse, Farmhouse Inns and Chef & Brewer brands, added it traded below the market partly as a result of its exposure to value food.

Operating profits fell 2.5% to £176.5m and pre-tax profits before exceptional items was down 8% to £92.5m.

“The first half was challenging for our managed pubs, but our actions to strengthen performance have produced an improvement since the period end,” CEO Rooney Anand said.

“We have committed additional investment to enhance the customer experience, including being more competitive on price, having more team members available at key times and strengthening local marketing activity. Pub Partners and Brewing & Brands again outperformed the market, generating cash for the group and raising the profile of Greene King.

“We will continue to benefit from our ability to generate significant cost savings and to improve investment returns to over 25% from rebranded pubs. Greene King is a strong, competitive business with industry-leading brands, a strong and flexible balance sheet, a sustainable dividend and an excellent track record of outperforming in challenging conditions. We are adapting our strategy to ensure we continue to sustain our long-term competitiveness, strong cash generation and attractive returns to shareholders.”

Morning update

Rival brewer and pub company Marston’s defied the gloom at Greene King as sales in the 52 weeks to 30 September leapt 10% to £992.2m, with profits up 3% to £100.1m.

The group said the growth reflected the acquisition of the Charles Wells beer business, the contribution from new openings and pub acquisitions and positive like-for-like sales in the pub business.

Group operating margins were in line with guidance but behind last year as a result of increased costs in destination and premium, the continued impact of converting pubs from tenancy to franchise and the short-term impact of the Charles Wells deal.

CEO Ralph Findlay said: “We have achieved strong revenue growth and higher earnings, despite increasing employment and property costs.

“Our business has been transformed in recent years with a significant improvement in the quality of both our pub and beer businesses. While political and economic uncertainty is likely to continue, we remain confident that our proposition founded on providing great customer experiences, the very best service and value for money, leaves Marston’s positioned to deliver further growth in the year ahead.”

Shares at Marston’s soared 12% to 117.4p as markets opened, compared with a 2.9% drop for Greene King to 524.5p.

Consumer confidence took another knock in November following an interest rates hike and rising prices. It is the 20th consecutive month the GfK Consumer Confidence Index was in negative territory. The index decreased by two points to -12 in November and all five measures used to calculate the score fell, with the biggest drop occurring in the Major Purchase Index (down 6 points).

“Sadly, there’s no festive cheer in this month’s Consumer Confidence Index,” said Joe Staton, head of market dynamics at GfK.

“This is the second time this year that consumer confidence has matched the worrying -12 score seen in July 2016 after the Brexit vote.

“This is also the 20th consecutive month where the Overall Index score has come in at a negative value – that’s not good festive news.

“Household jitters following the recent interest rate hike, squeezed incomes, higher inflation, and economic uncertainty have dampened the consumer mood across the UK. Perhaps of most concern during this key Christmas trading period is the plunge in the Major Purchase Index (a sharp 6-point drop). Many retailers have been hit by the slowdown in consumer spending as households begin to feel the pinch and cut-back on their budgets. The confidence trajectory is unquestionably negative and sadly no amount of tinsel or baubles will change it. We need some big, positive economic good tidings to reverse this downwards trend – some snap we can put into our Christmas crackers. But where will the Index be next month?.”

PayPoint revenues decreased 4.1% to £97.6m in the six months ended 30 September, with net revenue down 3.2% to £56.5m. Pre-tax profits slipped 1.5% to £24.4m in the half.

It is the first set of interim results at the payments specialist since the completion of its restructuring programme. Mobile payment business PayByPhone, which was sold in December, and Drop and Collect, which completed a renegotiation with Yodel last year, are included in last year’s reported numbers making this year’s interim performance not directly comparable.

PayPoint said it included highlights from its ongoing retail networks business to help comparisons, with revenues generated up 2.3% to £97.6m and net revenue up 5% to £56.5m.

CEO Dominic Taylor added: “It has been an exciting and busy six months for PayPoint as we have continued to reshape our business.

“PayPoint One is already benefiting over 6,800 retailers and we have just launched EPoS Pro and our EPoS mobile app, innovations which will further help our convenience retailer customers drive significant additional efficiencies and value within their businesses.

“We continue to see strong card payment growth while MultiPay, our omni-channel payment solution, has now processed over 22.5 million transactions since launch. Collect+ continues to perform strongly and has extended its lead in parcels, with a network now of over 7,200 sites.”

British American Tobacco and Imperial Brands clawed back some of yesterday’s losses (see below) to open up 0.8% to 4,841p and 0.8% to 3,070p respectively.

Greencore continued to rise, up 1.6% to 210.3p, but Ocado cooled this morning following a 40% jump this week, down 1.5% to 354.1p.

Yesterday in the City

Imperial Brands (IMB) slumped 2.9% to 3,045p following news on Tuesday night of the collapse of tobacco wholesaler Palmer & Harvey, which has been kept afloat for the past few months by Imperial and Japan Tobacco International. Imperial admitted in a statement to the stock exchange that it would take a £160m hit to its profits this year as a result of the collapse.

Shares in British American Tobacco (BAT), which did not have an exposure to P&H, fell by 3.4% to 4,802p as investor worried about a supply shortage to retailers from the P&H collapse.

Ocado leapt another 16.2% to 359.6p as the City piled into the stock after the announcement of the agreement with Casino on Tuesday. Shares are up about 40% this week and are trading at highs not seen since 2014.

Britvic (BVIC) fizzed 7% higher to 811p as the Robinsons owner revealed forecast beating annual results. Revenues increased 7.7% to £1.5bn in the year ended 1 October (2.5% on an organic basis) as it benefitted from its acquisitions in Brazil and a pick up in the UK soft drinks market.

Greencore (GNC) rose another 5.1% to 206.9p following its results on Tuesday, Marks & Spencer (MKS) jumped 3.8% to 312.4p and Sainsbury’s (SBRY) was up 2.7% to 235.6p.

Fallers included Unilever (ULVR), down 2.6% to 4,216p, Diageo (DGE), down 2.1% to 2,593.5p, and Reckitt Benckiser (RB), down 1.9% to 6,518p.

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