Camerons Brewery to expand Head of Steam pub brand - after selling 26 boozers in £8.25m deal

Camerons Brewery has announced plans to resume expansion of its flagship Head of Steam brand following a successful trading year.

The company, renowned for its Strongarm, Motorhead and Tooth and Claw beer brands, has released its 2023 accounts, revealing the sale of 26 tenanted pubs to London-based FB Taverns in an £8.25m deal.

Despite a significant reduction in trading pubs – from 75 to 47 – CEO and director Chris Soley reported strong performance across their estate, particularly in city centres where more workers are returning post-pandemic. The group, established in 1865, reported a turnover of £61.5m, only slightly down from the previous year's £62m, while Ebitda rose by £1.5m to £4.3m.

READ MORE:Rockliffe Hall: Plans submitted for 'world class' dining pavilion and restoration of Old Hall

READ MORE:Picture shows progress as £900m Teesside wind factory '90 per cent' complete

Operating profit saw a substantial increase, from £382,050 to £1.84m, and pre-tax losses were reduced from £5.5m to £547,660. Employee numbers fell from 715 to 647.

Following the end of the year, Camerons successfully refinanced its debts, writing off £11.2m and extending facilities of £15m until December 2026, providing a "forms a secure firm and certain platform, and growth can now therefore be accelerated" for accelerated growth.

In the company's financial report, Mr Soley remarked: "The group has performed very well in the year with a significant improvement in Ebitda from £2.8m in the prior year to £4.3m. This was even more impressive given that the current year only included six months trading of the 26 freehold tenanted pub estate (Project Lion) that was sold on 30 June 2023", reports Business Live.

He also noted, "Brewing volumes have continued to increase, as has margin, due not only to the uplift in volumes, but also because of the group being able to fully pass on cost increases it experienced in the latter part of the prior year. Pubs have performed well against a difficult economic back drop; our now largely managed estate has traded robustly, and it is pleasing to see our bigger city centre venues enjoying the extra footfall arising from more employees returning to their respective offices to work rather than from home."

The Hartlepool-based company, which now operates 45 pubs after selling its tenanted portfolio and exiting two Bar Soba leases, has seen one freehold pub sale since the year-end and anticipates two more disposals before the close of this year.

Mr Soley expressed enthusiasm for the finance deal mentioned in the accounts, which he believes will accelerate growth plans, particularly for the Head of Steam brand, founded in Newcastle. Since its acquisition in 2013, the pub brand has expanded from seven locations 11 years ago to several across the North East and further afield.

He elaborated: "This is a transformational transaction for the business and has resulted in £11m of debt reduction, and as a result, net debt to Ebitda has materially reduced from 5.9 times to a projected 2.7 times by December 24. This significant reduction of write down of our debt, which results in much lower debt service costs, means the group is excitedly looking forward to returning to growing both its brewery and pub operations.

"We are now able to reestablish the strategic expansion of our national flagship Head of Steam pub brand alongside our Urban Country Pubs estate, which was borne out of the acquisition of the Leeds Brewery pubs. We continue to invest in the development of the brewery including increasing our small pack capabilities and have a number of energy projects in process to support our route to net zero including the construction of a substantial solar panel array on our warehouse roof."

For breaking news in your area direct to your inbox every day, go here to sign up to our free newsletter