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(Sharecast News) - Marston's shares surged on Tuesday as the pub group said full-year profit was set to beat market expectations.
In an update for the year to 26 September, the company said underlying pre-tax profit would be above the top end of market expectations of £76.1m to £83.2m, delivering a third consecutive year of "significant" profit growth.
The company pointed out that profits are now more than three times the level of FY2023.
The underlying earnings before interest, tax, depreciation and amortisation margin rose around 100 basis points in FY2026, which Marston's said was supported by its "market-leading" pub operating model and disciplined cost control.
The group said new pub formats are now "a proven engine of growth", with the Grandstand sports pub format the standout performer. Grandstand is delivering returns on invested capital above 30%, with FY2026 investments delivering around 30% sales growth compared to pre-investment levels.
Following 60 format conversions in 2026, Marston's is aiming to deliver at least 100 in 2027, focused on Grandstand, as the programme scales to become "a material driver of group sales and profitability".
Marston's said like-for-like sales improved to broadly flat in the fourth quarter, supported by new pub formats, stronger summer trading and an "excellent" World Cup. Full-year like-for-like sales were down 1.2%.
Chief executive Justin Platt said: "We have delivered a third consecutive year of significant profit growth, margin improvements and strong recurring free cash flow. Our differentiated pub formats continue to drive excellent returns, and our guest satisfaction scores show that we continue to delight our customers - a credit to our talented, hard-working teams.
"Our progress over the last three years shows the momentum we have as a high margin, highly cash generative local pub company, with profits substantially up and debt levels halved. With clear strategic priorities and our new format conversion programme expanding to at least 100 pubs next year, we enter the new year well set to drive our next phase of growth."
At 1150 BST, the shares were up 17.8% at 54.40p.
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