Fullers setting the pace as pubs toast return to health

Reports of the death of the great British pub may have been exaggerated.

Results from two pub operators with a focus on selling good beer in traditional boozers suggest the gloom that pervades much of the sector is not entirely justified.

Fuller Smith & Turner increased sales and profits in the 12 months to the end of March, a return that puts it ahead of the competition.

Rivals that cater to younger drinkers or casual diners are either in administration or teetering on the edge, but Fuller's strategy of trying to operate the best pub in any area is paying off. Profits are up 4% to £23 million on sales up slightly at £181 million.

Although many Fuller pubs do food, the company doesn't consider that so-called "wet" pubs are no longer viable.

Chairman Michael Turner said: "We are delighted to see that beer volumes are up."

Hundreds of pubs are closing in the face of a consumer downturn.

Turner is looking to add more pubs to Fuller's portfolio but says prices are still too high. "Those looking to sell need to be more realistic," he said.

The final dividend is up 6% to 6.9p. Pubs 'n' Bars, the AIM-listed operator of 110 "local" pubs, mostly in the South, also had good cheer.

In the year to the end of 2007, sales rose a third to £20 million, with profits doubling to £1 million.

Chairman Seamus Murphy said the company has successfully fought off the smoking ban, cheap supermarket alcohol and higher taxes.

"We are confident that our community-driven pub business model will remain robust at a time when consumers are more cautious with their leisure spend," he added.