United Kingdom: Britain's biggest regional brewer and pubs group Wolverhampton & Dudley Breweries Plc (WDB) announced on March 31 good and in line with expectations trading overall in the 24 weeks to 19 March 2005 and aimed for steady profit margins as it kept a tight control of costs. WDB said total like-for-like sales were 3.1% ahead of last year in Pathfinder Pubs, and 3.2% ahead in The Union Pub Company. In WDB Brands, turnover and volumes were strong driven by good progress in the free trade and new distribution to other pub companies.

WDB, the brewer of Pedigree, Banks's and Mansfield beer, which also runs 2,135 pubs after its acquisition of 460 outlets from Burtonwood, is now Britain's third-largest pubs group after Enterprise Inns and Punch Taverns.

Commenting, Ralph Findlay, Chief Executive, said: "The outlook for consumer spending has generally become more cautious in recent months. Against that background our high quality pubs and beer business have continued to perform well."

WDB shares rose 1.5 percent to 10.98 pounds by 0750 GMT, valuing the group at around 843 million pounds. The shares have outperformed the FTSE 100 index by around 15 percent over the last year and by over 130 percent since it fought off a hostile 513p-a-share bid from Pubmaster in August 2001.

The WDB update came a day after Enterprise Inns said it was performing well and would comfortably meet its half-year expectations from its 8,663 leased and tenanted pub estate. Findlay said the group was hit by rising costs, especially for labor and satellite TVs, but had brought in new till systems and cut purchasing costs for its expanding pub chain as it aimed to keep operating margins at last year's 22 percent level, according to Reuters.

WDB's pub trading was generally in line with its January update when the company said like-for-like sales in the first 15 weeks of its financial year up to January 15 were up 3 percent at its managed pubs and 3.4 percent ahead at its tenanted pubs.

The 115-year old central England brewer has been adding to its pubs, buying Wizard Inns' 63 managed pubs last June for 90 million pounds, and then paying 119 million pounds for Burtonwood's 460 largely tenanted pubs. The group has raised its expectations of annual cost savings from the Burtonwood deal, completed in January, to at least 3.5 million pounds ($6.58 million) from 3 million pounds previously.

Investec analyst James Wheatcroft described the update as encouraging. He is predicting pretax profits of 88.4 million pounds for the year to end-Sept 2005 and will probably upgrade at the half-year results to account for the extra Burtonwood savings. The group's half-year results for the 26 weeks to April 2 will be reported on May 20.

WDB said: “The acquisition of Burtonwood PLC was completed on 6 January 2005. The majority of the integration projects, including the transfer of systems, will be completed by the end of March, ahead of schedule. We have increased our expectations of synergies available from £3 million per annum to at least £3.5 million per annum. The estate is trading in line with our plans.”

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