Genco Shipping & Trading Limited Annual Report 2023

FY2023 Annual Report · Genco Shipping & Trading Limited

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A Year in Review 2023

02 Greene King Limited | The Year in Review - 2023

Contents

03
04
06
07
09
10
12
14
18
22
28
32
38
39
40

At a Glance
CEO Review
Our Business Model
Measuring Success
Pride of Greene King Awards
Achievements in 2023
Our People
Destination Brands
Greene King pubs
Partnerships & Ventures
Brewing & Brands
Environment, Social and Governance
Macmillan Cancer Support
The King’s Coronation
Financial Review

At a Glance

REVENUE

£2.38b

(52 weeks to 31 December 2023)
vs £2.18b for the 52 weeks up to
1 January 2023

ADJUSTED
OPERATING PROFIT

STATUTORY
OPERATING PROFIT

£186.1m

(52 weeks to 31 December 2023)
vs £192.6m for the 52 weeks up to
1 January 2023

£167.2m

(52 weeks to 31 December 2023)
vs £249.2m for the 52 weeks up to
1 January 2023

FREE CASH INFLOW

INVESTMENT

NEW APPRENTICESHIPS

£9.6m

(52 weeks to 31 December 2023)
vs £13.1m for the 52 weeks up to
1 January 2023

£215.1m

Capital expenditure for the group
(52 weeks to 31 December 2023)
vs £208.1m for the 52 weeks up to
1 January 2023

944

New apprenticeships started
across Greene King in 2023

NUMBER OF EMPLOYEES

NUMBER OF PUBS

RAISED FOR MACMILLAN

40,551

Monthly average across 2023

2,623

On 31 December 2023

£3.8m

Taking our total raised since
2012 to more than £17m

04 Greene King Limited | The Year in Review - 2023

CEO Review

Our teams have worked incredibly hard to
deliver a robust financial performance as our
strategy continues to drive us forward to delight
our customers, support our teams, create a culture
of pride, deliver consistent financial returns and
prioritise operational excellence.

Nick Mackenzie,
Chief Executive Officer

Overview
Building the foundations of a stronger and
more sustainable Greene King has been
at the forefront of our work this year,
ensuring we are fit for the future.

This means balancing long-term investments
alongside hitting our short-term goals. I’m
pleased to say that we have seen significant
progress on many of our strategy drivers
and values, with a particular focus on
putting our customers first and looking
after our team members, leased and
tenanted partners and franchisees.

The powerful crosswinds I referenced in
2022 continued as expected in 2023. Despite
these challenges, we delivered a robust
financial performance and have once again
invested significantly in our stellar pubs estate,
with £215.1m invested across the business.

Towards the end of the year, I accepted
the position as chairman of the British Beer
and Pub Association. This is a real honour
and gives a platform to extol the virtues
and values of an industry that I am
passionate about.

Pubs and brewers continue to see costs
rise and it is imperative that we highlight the
continuing positives that these institutions
bring local communities, not just providing
social value but also generating economic
growth and contributing to the Treasury.
In 2023, Greene King’s total annual tax
stood at c£518m.

For all these short-term economic realities
and, in particular, the increased costs of
doing business, I remain ambitious and
confident about the future for Greene King.
This is why we continue to invest significantly,
as we know over the long-term it will set
us apart from our competitors, both for

our teams – who are the lifeblood of our
business – and also for our customers who
will be able to visit outstanding pubs
in their local communities.

Strategy into action
When I joined Greene King, I spoke about
making it more brand-focused. This is an
important next chapter for a business
that has grown in the past 30 years to
become the country’s largest integrated
pub company and brewer.

We made significant strides on this in
2023 with the announcement of the
Greene King pubs brand as a standalone
pub chain alongside our other brands.

We also announced two new concepts –
Seared and Everly – which we are incredibly
excited to trial in 2024 and have the
potential to be rolled out as new brands.

Following our initial investment in Hickory’s
towards the end of 2022, its rollout is gaining
momentum. We invested in our first four sites
in 2023 and I am particularly excited about
watching this expansion in 2024. We continue
to proactively invest in our Chef & Brewer
Collection, creating outstanding country pubs
and hotels nationwide, and our Hive Pubs
franchise is now approaching 50 sites.

We continue to balance our brewing
heritage alongside creating exciting new
beers for the future. This means building on
the success of some of our established beers
including Abbot Ale, which won gold in the
Premium Bitters category and silver in the
Supreme Champion category at the Great
British Beer Festival this year. Meanwhile,
our newer beers, Level Head and Flint Eye,
continue their expansion as we broaden
our premium craft portfolio.

This year also saw us create a new
operational excellence function within
Greene King. Given our size and breadth,
this allows us to coordinate and time key
projects across our pubs. Working in this
more efficient manner helps offset external
costs, makes life easier for our team
members, and lets them focus more
on looking after our customers.

Last year, environment and social became
core to the Greene King strategy and this
has been exemplified this year. Not only did
we receive approval from the Science Based
Targets initiative (SBTi) for our target to
halve our greenhouse gas emissions by 2030
compared with 2019, but we also launched a
new supplier platform called Engage. This will
allow us to work with hundreds of suppliers
to drive positive change across the industry.

Our people
We are seeing more people choose to keep
on working at Greene King for longer, which
is a great testament to the efforts we have
made to invest in our people and transform
our culture. Our team member turnover
reduced to 66% this year, an improvement
of 12ppts over the course of the year.

Our measure of team engagement, which is
based on team feedback, has improved again
to 87%. It shows that the vast majority of
our 40,000 team members are engaged and
energised about working at Greene King.

We also saw strong scores in our Pub
Partners business unit, where Greene King
was ranked first out of the six biggest
leased and tenanted pub companies in
the Licensee Index, carried out
independently by KAM Media.

Helping people build long-term careers in
the hospitality sector, and promoting social
mobility, is something that has been core
to Greene King for several years. This year,
we celebrated the milestone of 17,200
apprentices supported since 2011.

Progress also continued with our Releasing
Potential programme, finding roles for
people just leaving prison and providing a
stable job to help them rebuild their place
in society. As part of this, we opened a
training kitchen at HMP Grampian last
year; in December it was a moment of
pride to see the first group of cohorts
graduate and be offered jobs working in
Greene King kitchens.

Our customers
Our aim is to be the pride of British
hospitality and a truly customer-first business.
We know many of our customers have
struggled this year with rising costs and a
visit to the pub is viewed differently to
how it would have been in years gone by.

It is important we adapt and ensure that
we are offering great experiences; we
know that, more than ever, our customers
are having to make extremely conscious
decisions about where they spend
their money.

This is why we focus on delighting our
customers when they visit us, providing
great experiences that still represent
good value for the quality of product and
amazing service they receive in our pubs.

We have consequently seen some great
progress in our customer review scores,
hitting an average review rating of almost
4.4 out of 5 across all our managed pubs
by the end of the year.

Our communities
The social value of pubs at the heart of their
communities cannot be underestimated.
When our pubs marked the King’s
Coronation in May, we published survey
research showing 82% of Brits think pubs
are important for local communities and
73% say socialising is the most important
reason for visiting a pub. This shows what
a strong place the pub holds in the British
psyche, not only as a place to spend quality
time with friends and family but also for
what it represents for communities.

At a time when all charities are struggling
for financial donations, the fact our teams
helped raise £3.8m for Macmillan Cancer
Support in 2023 is phenomenal and I know
just how much the team at Macmillan
appreciate their efforts.

Fundraising is not the only way our pubs
give back; our Christmas table initiative
saw 831 Christmas lunches given away to
those in their communities who would
otherwise spend 25th December alone.

Inclusion and diversity
We focused on Leading Inclusively in 2023,
as we continue our progress to everyday
inclusion. We launched several new policies
and commitments, including a target to
have 50% female representation across
our senior management teams by 2030.
This is something I feel is key to becoming
not only a more diverse organisation, but
also helping to make us much stronger, too.

We continue to focus on meeting the
targets laid out in our Calling Time on
Racism manifesto, published in 2021, which
remains a core commitment as we continue
to work towards our aim of being a truly
anti-racist organisation.

Looking ahead
We remain focused on the long-term,
putting in place significant investment now
that we know will benefit us in the future.

This is an ambitious business entering its
next chapter, as we invest in a long-term
vision to build a balanced portfolio,
coupling innovation across new concepts
and digitisation with the evolution of existing
brands. Further digital announcements are
planned as we look to take our digital
offer for customers to a new level –
another example of making Greene King
fit for the future.

While references to Covid-19 thankfully
do not feature in this year’s review to
anything like the degree of previous years,
the impact of the pandemic and wider
global events on the economy continue
to significantly impact us all.

We are in a strong position, however.
I am pleased that, despite these challenges,
our teams have worked incredibly hard to
deliver a robust financial performance as
our strategy continues to drive us forward
to delight our customers, support our
teams, create a culture of pride, deliver
consistent financial returns, and prioritise
operational excellence.

Finally, I would like to thank everyone who
works for Greene King, together with our
owners, our tenanted and leased partners,
our franchisees and our suppliers. I would
also like to thank our trade bodies who
play an enormous part in championing this
great industry and highlighting the social and
economic benefits of pubs, breweries and
the wider hospitality sector to the UK.

06 Greene King Limited | The Year in Review - 2023

Our Business Model

Measuring Success

THIS WAS A YEAR OF PROGRESS ON THE STRATEGY WE INITIALLY SET OUT IN 2021 AND
DEVELOPED FURTHER IN 2022. THIS STRATEGY IS REFLECTED IN OUR BUSINESS MODEL
WHICH AIMS TO DELIVER VALUE IN A VARIETY OF AREAS AS WE FULFIL OUR PURPOSE
TO POUR HAPPINESS INTO LIVES.

WE MEASURE OUR SUCCESS THROUGH A BALANCED SCORECARD CALLED THE DARTBOARD,
WHICH TRACKS AND MONITORS GROUP PERFORMANCE AGAINST A BROAD RANGE OF
PERFORMANCE INDICATORS.

Inputs

Strategy

Value

Resources and relationships
we rely on to...

...operate the UK’s largest integrated
Pub Company and Brewer...

...in pursuit of our purpose to
pour happiness into lives

BRANDS

CUSTOMER

PEOPLE &
PARTNERSHIPS

More than 40,000 talented
team members and around
900 pub partners
across the UK

SUPPLIERS &
RESOURCES

A network of trusted suppliers
providing us with the resources
and goods we need to run
our pub and brewing
businesses sustainably

COMMUNITIES &
GOVERNMENT

The engaged communities
in which we operate in the
UK and the support of
government and
trade bodies

Grow reach through compelling,
profitable brands

CULTURE

Transform our culture

PEOPLE

Invest in our people

ENVIRONMENT & SOCIAL

Supporting our communities and
reducing our environmental impact

EXPAND

Through innovation and
targeted acquisitions

ASSETS

Unlock value through making
the most of our assets

QUALITY ASSETS

The estate of pub and brewing
assets we own and operate across
the UK and the sector leading
brands that reflect our
rich heritage

DIGITAL

Turbocharge the digital experience
for our guests and teams

OPERATIONAL EXCELLENCE

Managing cost inflation and
building sustainable processes

We put customers at the heart of
our decision making and strive to
serve more customers, delighting
them every time

PEOPLE

We are a business for everyone,
investing in our teams to grow skills
or a fulfilling career in hospitality

OPERATIONAL
EXCELLENCE

We make it easy for our teams to
consistently deliver outstanding
experiences for every customer
through every interaction in an
efficient way

FINANCIAL

Our business model
delivers consistent returns through
a balanced portfolio and cash
generation to fund growth

PRIDE

We create a culture of pride
in our business as a positive
contributor to our communities
and our environment

PRIDE
We create a culture of
pride in our business

• How proud our
people are to be
associated with
Greene King

• Actual energy used in
our pubs compared
with predicted usage

CUSTOMER
We put customers
at the heart of our
decision marking

• Sales
• Performance
vs the market

• Reputation

FINANCIAL
Our business model
delivers consistent
returns

• Return on assets
• Free cash flow
• Asset optimisation

PEOPLE
We are a business
for everyone

• Total turnover
• Sustainable
engagement
• Management

stability

r e t u rns We put customers at the h

OPERATIONAL
EXCELLENCE
We make it easy
for our teams
to consistently
deliver outstanding
experiences

• Managing team hours
to match demand

• Volume of Greene King
beer sold in our pubs
• Safety and compliance

t e n t

s i s

• How well we are
delivering on our
brand, values and
purpose propositions

Our business m o del d eliv e r s c

W
e
c
r
e
a
t
e

c
u

t
u
r

s
i
n

s We are a business fo r e v e r y o n

r
t

i
s
i

t
n
e
t
s
i
s
n
o
c
o
t
s
m
a
e
r t
u

s
e
c
n
e
i
r
e
p
x
e
g
din
n

deliver outsta

W e make it easy for o

PURPOSE WHY WE DO IT

STRATEGY GOAL WHAT OUR AIM IS

To be the Pride of British Hospitality,
famous for outstanding experiences

STRATEGY
DRIVERS
WHAT WE WILL DO

Turbocharge the digital experience
for our guests and teams

Grow reach
through compelling
profitable
brands

Transform our culture

Supporting our communities, giving
people better lives and reducing
our environmental impact

Invest in
our people

Managing cost inflation and
building sustainable processes

Through innovation and
targeted acquisitions

Unlock value through making
the most of our assets

OUR GREENE KING
VALUES WHO WE ARE

customer first
we take ownership

we care

freedom to succeed
win, learn, celebrate together

OUR GREENE KING
BEHAVIOURS
HOW WE DO IT

achieve

connect

drive

grow

How we will drive the future success of our business, in pursuit of a purpose we are proud of,
delivered by a clear strategy, underpinned by our Greene King values and behaviours

Pride of Greene King Awards

IN APRIL, WE CELEBRATED OUR BIGGEST PRIDE
OF GREENE KING AWARDS TO DATE, RECEIVING
A RECORD NUMBER OF NOMINATIONS ACROSS
TWELVE AWARDS.

We brought to life our value ‘Win, Learn, Celebrate Together’ with a gala night
to announce the winners. It was held at The Tileyard North in Wakefield
and hosted by Johnny Cochrane, the comedian and radio presenter.

Sharon McDermott

Winner of the Outstanding Contribution award, chosen by the Executive
Board, was Jason Radbourn, Head of Food and Product Development.
Meanwhile, the ‘We Pour Happiness into Lives’ award, voted by team
members, was won by Richard Johnson, General Manager at Plum Tree
Farm in Blackpool.

CONGRATULATIONS TO ALL THE 2023 WINNERS

We Care Award
Peter Noble
Property Estates Manager

Customer First Award
Sharon McDermott
General Manager at White Barn,
Cuddington, Cheshire,
Destination Brands

Freedom to Succeed Award
Ranya Ball
Business Development Manager,
Greene King pubs

We Take Ownership Award
Stuart Lloyd
Large Pack Manager,
Brewing & Brands

Win, Learn, Celebrate
Together Award
Pub Partners Franchise Team
Partnerships & Ventures

Pride Award
Sophie Burgess
Business Development Manager,
Greene King pubs

Operational Excellence Award
Simeon Baker
Pub Partners Business Development
Manager, Partnerships & Ventures

Customer Award
Callum Wilson
General Manager at The County,
Gosforth, Tyne and Wear,
Greene King pubs

Financial Award
Pricing Optimisation
Workstream team

People Award
Lynne Kennedy
Talent Development Manager,
Apprenticeships and Employability
Programmes team

Lynne Kennedy

Peter Noble

Ranya Ball

Jason Radbourn

10 Greene King Limited | The Year in Review - 2023

Achievements in 2023

WE HAVE MADE PROGRESS AGAINST ALL EIGHT OF OUR STRATEGY DRIVERS THIS YEAR.

The foundational projects that we announced in previous years focus on the role of our brands and understanding our customers.
These have continued to inform our strategic direction. We announced two new brand trials, moved multiple sites into more
optimal brand formats, and completed the reorganisation of our business from five divisions to four. We are proud of the steps
we have taken this year towards our goal of becoming the Pride of British Hospitality.

The Cart & Horses, Winchester

Winners of the Best Pub Employer, Publican Awards

CULTURE

BRANDS

PEOPLE

OPERATIONAL
EXCELLENCE

ENVIRONMENT
& SOCIAL

Supporting our communities, giving
people better lives through our work
with Macmillan and reducing our
environmental impact.

• Launched Greene King Engage, our

supplier engagement platform. It enables
us to have a two-way conversation about
environment and social matters with our
suppliers. The platform was launched at
our Greene King for Good conference in
October, with 200 food, drink, property
and IT suppliers invited.

• Raised £3.8m for Macmillan Cancer

Support in 2023, taking our total to more
than £17m since our partnership began.

• Having set a near term target of halving
greenhouse gas emissions across scopes
1, 2 and 3 (direct and indirect emissions)
by 2030 through the Science Based
Targets Initiative and committed to a
net zero target of 2040, we made good
progress this year. We launched trials for
alternative pub heating technology, plus
solar panel trials at our support centre
in Burton-on-Trent and in a pub.

Create a culture and environment
through development programmes,
investment in tools and training and
use of our balanced scorecard giving
our teams the freedom to succeed.

• Our measure of team engagement,
which is based on team feedback,
has improved from 84% to 87% and
reflects the investments we have
made in improving our culture.

• Continued our journey towards

‘Everyday Inclusion’ with our reverse
mentoring scheme and leading inclusively
programmes for managers within our
business. We also partnered with
external specialists to offer mentoring
to our female talent, supporting our
commitment to reach gender parity
at leadership levels by 2030.

• Launched our ‘Pint of Perspective’ podcast,
aiming to create more readily consumable
and engaging content representing
our inclusion journey. This has been
supported by, and featured members of,
our four Employee Led Inclusion Groups.

Greene King for Good conference

Pint of Perspective podcast recording

Maria Sebastian,
Chief Marketing Officer

We have seen product

development and innovation this
year, alongside the evolution of
our brand portfolio and digital
presence, which all contribute to
delighting our customers every
time, creating a sustainable
business for the long-term.

Nick Elliot,
Group Property Director

We have focused on reviewing

our estate to optimise our assets
for the right brand as well as
taking a longer term view of
investment cycles. Environmental
initiatives play an important
role in our property investments,
including voltage optimisation
and EV charging installations.

Establishing compelling brands for
long- term sustainable growth.

• Announced the trial of two exciting
new concepts as we continue our
journey toward a balanced portfolio
of brands. Seared, a pub concept, offers
a freshly grilled, globally-inspired menu,
while Everly Hotels Collection is a
boutique hotel offer delivering
modern comfort and sophistication.

• Added the Cart & Horses, Winchester

(pictured above), and the Prince of Wales,
Esher, to our premium brand Crafted
Pubs, bringing this format up to six
sites in total.

• Increased our franchise business to 52

sites, of which 45 were Hive – up from
28 last year.

• Won 18 different awards for our beer
brands this year, including a Great Taste
award for Ice Breaker and a gold and
silver award for Abbot Ale at the
Great British Beer Festival.

Transform our culture and our team’s
experience to enable them to deliver
on our goal.

Drive innovation and cost efficiency
creating sustainably lower costs and
ways of operating.

• In March we were named Best Pub
Employer (501+ employees) at the
Publican Awards, a major accolade
in the sector.

• Colleague turnover has reduced to 66%,
down 12ppts over the course of the year.

• Launched Smart Recruiters, a leading

digital platform, to significantly enhance
our recruiting capabilities, improve the
induction experience and increase
efficiency for our teams.

• Created a new code of conduct and
supporting policies for our teams,
codifying our commitment to improving
our team’s experience while delivering
for our customers. For example, in 2023
we launched new employee policies
around gender identity, menopause
and menstruation, and parental leave.

• Installed voltage optimisation equipment

in 308 of our managed pubs and
announced plans to roll it out to 600
pubs in total, which will make these
sites more energy efficient.

• Created a new Operational Excellence
function to ensure that not only can we
generate new operational excellence ideas
but, vitally, that we can also execute these
ideas successfully within our pubs. The
function aims to make life simpler for our
pub teams, ensuring that they can focus
on delivering for our customers.

• Rolled out a new bookings digital platform,
improving operational effectiveness and
efficiency for our teams.

EXPAND

DIGITAL

ASSETS

Build a balanced portfolio of
sustainable brands through targeted
acquisitions and innovation.

Build meaningful relationships with
customers through digital and make
it easy for them to connect with us.

• Having invested in Hickory’s in 2022, we
continued the expansion of this exciting
brand by opening four new sites in 2023.

• In March, the investment in Hickory’s
won Deal of the Year at the Retailers’
Retailer Awards.

• Continued to grow our Chef & Brewer
brand with significant investments
and conversions, including The Royal
in Portishead and The Victoria in
Menai Bridge.

• Leveraging the latest technologies, we
have increased customer engagement
and visit frequency across our digital
communications channels.

• Installed significantly upgraded Wifi
at 95% of our managed pubs estate,
equating to 1,561 pubs, as part of our
‘Pub Network of the Future’ project.

• Launched new and customer-focused
pub websites, making it easier for
customers to navigate and book online.

Make the most of our assets,
maximising their potential.

• Improved our customer experience by
investing £150m into capital projects in
our pub estate, enhancing the quality of
our assets. This included the movement
of 27 pubs to new trading formats to
better serve their customer communities.

• Continued rolling out our EV charging

stations, bringing our total number to 648,
to improve how we use our assets and
providing vital infrastructure.

12 Greene King Limited | The Year in Review - 2023

Our People

People and culture sit at the heart of Greene King’s
strategy and we wanted to do all we could in 2023 to
continue supporting our teams, both in their day-to-
day learning and career development, but also through
our benefits programme and embedding everyday
inclusion across our pubs and workplaces.

Andrew Bush, Chief People
& Transformation Officer

Driving positive change
Greene King’s everyday inclusion journey
is making positive steps. We continue to
encourage everyone to fulfil their potential,
regardless of age or background.

Our Inclusive Leadership culture change
programme is helping our leaders make
inclusion a reality in their teams. We
have made strong progress against our
representation ambitions; we have seen
an improvement across most areas, and
we are working towards our target of
women filling 50% of senior management
roles by 2030.

In 2023, our four Employee-Led Inclusion
Groups (ELIGs) played key roles in strategic
decisions and formulating new policies for
team members. The ELIGs are:

• Ability: our disability focused ELIG

• Greene Sky: our female focused ELIG

• Unity: our Black, Asian and minority

ethnic focused ELIG

• Village Greene: our LGBTQ+

focused ELIG

The ELIGs provide an important forum for
raising awareness of issues and concerns
facing the community they represent and
propelling change within the business.

As a direct result of this work, we
announced several new policies in 2023:

• We fast-tracked a new menopause
and menstruation policy, recognising
the need to remove the stigma,
normalise the conversation about
these issues, promote greater awareness
and provide better practical support.

• We launched an improved flexible-

• Ensure that our community activity

working policy which is designed to help
people through their different work/
life stages. We also introduced a suite of
enhanced family-leave policies, including
paternity and compassionate leave.

• We announced a new gender identity

policy to offer support and reassurance
for LGBTQ+ team members who are
transitioning at work or who identify as
a different identity to that with which
they were born. Line managers now
receive guidance on how they can
support team members before,
during and after they transition.

Calling Time on Racism
As part of our ambition to become
a truly anti-racist organisation, in 2023
we continued to make progress on
the commitments made in our 2021
manifesto, ‘Calling Time on Racism’.

The report set out four long-term
commitments to drive cultural change in
how we recruit and develop our people,
ensure that our pubs, restaurants and
hotels are welcoming to everyone, and
deliver on our ambition:

• Our senior leadership team will fully

embrace anti-racism in philosophy and
practice, leading the journey of racial
inclusion and representation across
the organisation.

• Establish and embed a sustainable culture
of inclusion, celebration of difference
and courage across the business.

• Enhance the customer experience and
leverage the Greene King brand and
assets to promote racial inclusion and
drive entrepreneurial opportunities
for those who experience racism.

reflects the diversity of the communities
we serve, being a driver for change on
race diversity locally.

Employee benefits
All our team members have access to a
range of benefits, including a discount in
our managed pubs of 33% off food and
drink, and discounted overnight stays in
Greene King hotels.

We operate a Friends and Family Scheme
for employees to give friends and family a
15% discount.

In January, we also increased the discount in
our managed pubs to 50% to thank all our
teams for their support over Christmas.

A specific benefits section on ‘Kingdom’,
our internal app, provides all our team
members with access to discounts for
hundreds of major retailers, as well as
gym memberships and holidays.

We also offer access to the Wagestream
app. This lets employees instantly access,
track and save earnings in real-time if
needed, while also offering confidential
financial coaching.

Mental wellbeing
Our Employee Assistance Programme is
available 24/7 and includes a confidential
telephone hotline for all team members
to access free support and counselling.

Following training with Mental Health
First Aid England (MHFA), we now have
more than 100 mental health first aiders
at Greene King, spread across a range of
departments across the country.

14 Greene King Limited | The Year in Review - 2023

Destination Brands

It was an important year for Destination

Brands as we realigned our portfolio and
welcomed the Flaming Grill team to the family.
We were extremely proud to see our customer
scores at a record high across all brands and
that’s thanks to our fantastic and engaged team
members who bring our brands to life.

Jodie Tate, Managing Director,
Destination Brands

REVENUE

£787.4m

ADJUSTED EBITDA

£90.3m

ADJUSTED
OPERATING PROFIT

£47.5m

Our Destination Brands division focuses
on creating distinctive brands that bring
friends and family together by delivering
consistently great service, quality and
value for money across a range of
eating out and drinking occasions.

Our structure
The Destination family comprises four
key brands: Hungry Horse, Chef & Brewer,
Farmhouse Inns and Flaming Grill. Together,
these amount to 600 pubs in total.

In 2023, Flaming Grill joined the Destination
Brands portfolio, further strengthening our
value offer for customers.

Wacky Warehouse is also an important
part of the portfolio, offering great value
soft play experiences for families.

Across the estate, we have more than
1,500 rooms offering accommodation; this
includes the Chef & Brewer collection.

Our ambition
Managing a diverse portfolio of brands,
our aim is to deliver outstanding customer
experiences whatever the occasion.
In 2023 we began our journey of brand
evolution, ensuring that we always work
our hardest to meet our customers’
expectations and changing needs.

We strive to deliver operational
excellence, constantly evolving our
estate by investing in new brands while
maintaining the underlying value of its
less-invested elements.

Measuring our performance
In 2023, our total revenue of £787.4m was
up 2.2% compared with 2022, but this came
against considerable cost headwinds that
slightly impacted adjusted operating profit.
Nevertheless, sales performed well in the
first half of the year and, despite a wetter
and cooler summer suppressing trade over
the key holiday period, we saw steady
improvement that ultimately led to
record sales over Christmas.

Price increases did help to drive sales
growth; however, when viewed over a
two-year period, our prices are slightly
below competitors as we continually aim to
provide compelling value to our customers.

Overall, all our brands were in growth
across the year with strong like-for-like
sales. Our accommodation sales were
also up 14.3% year on year.

Investing in our communities
We have invested £14.4m in 28 core
development investment projects this year.
This includes two new sites that we bought
in 2022: The Victoria in Menai Bridge and
The Royal Inn in Portishead. These two
businesses are part of our Chef & Brewer
brand and both have performed ahead
of expectations after undergoing
significant investment.

Looking after our customers
Customer experiences are crucially
important for our brands, so it was a huge
positive to see our scores in this area

continue to go up year on year.
Our ‘Reputation’ measure of online
review scores improved by 29 points in
2023 compared with 2022 and we also
saw an improvement in the number of
complaints this year.

Engaging our people
Our customer experience – and, therefore,
our division’s performance – depends on
more than 16,000 people who work in
Destination Brands.

Despite the challenging employment market,
we are delighted to have seen our people
measures improve across all metrics. Total
turnover improved by 14ppts in the year,
with our sustainable engagement score
improving 3ppts compared with last year,
and business pride improving 1ppt over
the same timeframe.

These measures came from our annual
engagement survey, which 83% of our team
completed this year, an increase of 8ppts
on 2022.

Looking ahead
We expect this to be a transformational
year as we focus even more on developing
our brands. Towards the end of 2023 we
announced our new brand Seared – the
‘Pub with Global Grub’ – with our first site
in Droitwich Spa. We are looking forward
to developing this brand and will announce
further news on this in 2024.

16 Greene King Limited | The Year in Review - 2023

The Royal Inn, Portishead,
Chef & Brewer

This year we continued our progress to accelerate and develop the
Chef & Brewer brand. Part of this involved carrying out a six-figure
investment at The Royal Inn in Portishead.

Greene King bought the pub in 2022. It dates back to 1830 and is
set in a 1.6 acre plot overlooking the Severn Estuary.

Extensive internal and external refurbishment included redeveloping
ten hotel bedrooms with views over the Bristol Channel, an internal
extension, and a three-tier external area with outdoor bar.

Staying true to the province and heritage of the area, we considered
the region’s history and took care to avoid compromising the look
of the building. Since opening, the venue has boasted impressive
figures with its average weekly turnover exceeding expectations.

Greene King bought the pub in 2022. It dates back to 1830

and is set in a 1.6 acre plot overlooking the Severn Estuary.

Hungry Horse Toy Boxing

Our ongoing community engagement work across Destination
Brands saw Hungry Horse launch its Toy Boxing campaign for
the third consecutive year.

The initiative helps provide toys to those families most in
need in each of our pubs’ communities.

We launched the 2023 campaign by installing an enormous
sack of presents in Manchester city centre alongside TV
personality and mum, Charlotte Dawson. The giant structure
represented the millions of children who faced the prospect
of going without a gift at Christmas.

In total, 235 pubs took part in the initiative, with dedicated
donation stations inviting customers to drop off any preloved,
new or unused toys.

Overall, the toy drive saw over 16,000 presents donated to
local communities nationwide - a new Hungry Horse record.

This work is part of our wider community strategy of putting
our pubs at the heart of their community.

Overall, the toy drive saw
over 16,000 presents donated to
local communities nationwide -
a new Hungry Horse record.

18 Greene King Limited | The Year in Review - 2023

Greene King pubs

We have built strong foundations this year with
performance ahead of the market and 2024 will see
the new Greene King pubs brand identity start to
appear across our estate. I would like to thank our
20,000 team members for the energy they bring to
work every day and for helping to create fantastic
pub experiences for our customers.

Clair Preston-Beer, Managing Director,
Greene King pubs

REVENUE

£938.4m

ADJUSTED EBITDA

£176.0m

ADJUSTED
OPERATING PROFIT

£121.7m

Engaging our people
Our latest team member engagement
survey produced high scores that were
broadly level with last year, which also saw
a strong set of results. Our sustainable
engagement score improved by 1ppt to
87% and our business pride score was down
1ppt to 85%. In total, 81% of the Greene
King pubs team completed the survey.

We also saw an improvement in our team
turnover, which improved by 8ppts between
January 2023 and the end of the year.

Looking ahead
During 2024 we will start rolling out the
new Greene King pubs brand identity. This
will mean an acceleration of investments,
particularly for our Urban and Community
pubs. Our aim is to attract three million new
customers through our doors and, to help
us get there, we will use more of our digital
tools to drive broader customer reach.

The Greene King pubs division was
created in 2023 and represents the
group’s power brand within the
wider Greene King estate.

It is focused on driving long-term
value through a clear ambition
for the Greene King brand to be
the nation’s most loved pub brand.

Our structure
Greene King pubs has four business units:
Community Pubs, Proper Locals, Urban
Pubs and Food Pubs. In total, these
amount to 898 pubs.

We have spent time reorganising our
teams into these more focused groupings
in order to help us provide a more
consistent experience for our customers.

Measuring our performance
Both our revenue and adjusted operating
profit increased by over 9% compared with
2022, with like-for-like sales also strong.

Inflation played a significant role this year by
driving price rises but we remained broadly
in line with our nearest competition.

City centre hospitality businesses
have experienced a particularly slow
recovery from the effects of the Covid-19
restrictions, so we have been encouraged
by the performances of our Urban pubs.
Specifically, their performance during
the second half of the year was strong
and ahead of the market.

Investing in our communities
As we look to set ourselves up for longer-
term success, we have continued our
rigorous programme of pub investments
by spending £28.1m on core investments
at 51 pubs in 2023.

We are pleased with the sales and profit
performance at these sites, which gives
us confidence to continue with these
programmes. We also completed two
transfers in from other divisions of the
wider group and transferred four pubs
out to the Partnerships & Venture
division for the Pub Partners estate.

Looking after our customers
We were pleased to see our customer
satisfaction scores go up in 2023 since
this is a key focus of our ambitions for
the brand.

We want to build a more consistent
brand with strong foundations; in turn,
this will support our teams by boosting
engagement and training.

We saw a positive shift in online reviews
left by customers this year, with the number
of customer complaints also improving.

We measure customer satisfaction as
‘Reputation’ on our Dartboard scorecard
and in 2023 this score increased by
seven points.

20 Greene King Limited | The Year in Review - 2023

Greene King pubs

Greene King pubs are at the heart of communities across the
country, providing hospitality and a home away from home to
tens of thousands of customers every day.

The Greene King brand has a rich history and is a favourite among
consumers. We want to build on this to create a more distinct
Greene King pubs brand which heroes our great people, fantastic
pubs, outstanding experiences and high-quality, own-brewed beers.

Our plan is to make Greene King pubs the nation’s most loved pub
brand, giving it a unique identity and a clear role to build lasting value
over time. It will complement our existing portfolio of brands, each
of which play an important role for us in key segments of the market.

We will have a customer-led approach at the centre of our
offering, making sure Greene King pubs are top of minds for all key
occasions, so customers naturally choose to visit us more often.

The brand’s 898 managed pubs will focus on: making customers
feel at home; bringing people together; creating a friendly and
welcoming environment; and taking pride in everything we do.
This will result in us delivering an outstanding experience from
the moment customers enter our pubs to when they leave,
including our quality food and beverage offering. In particular,
we will showcase our much-loved, own-brewed beers such as
Greene King IPA, as well as newer beers like Level Head and
Flint Eye.

To deliver on this ambition, we will significantly invest both in our
Greene King pubs estate, as well as in how our brand shows up
for customers. This combination will ensure we stand out within
the pubs market.

Our plan is to make
Greene King pubs the
nation’s most loved pub
brand, giving it a unique
identity and a clear role
to build lasting value
over time.

The Ship in
Saltburn-by-the-Sea

Popular Saltburn-by-the-Sea pub The Ship is part of our
Community pubs business unit. In 2023, the pub underwent
a six-figure investment to transform its interior and
develop a new beer garden.

With direct access to the beach, the beer garden now has
its own, separate bar and has expanded to seat 250 people.
The pub itself also has a new fish-and-chip shop, which offers
customers eat-in or takeaway options.

Internally, the pub has a new-look, modern décor as well as
an extended bar and snug area. During the refurbishment, we
revamped all the internal rooms, including the new champagne
bar and also the family room, which now contains a large bar
area with a bay window.

With a strong community focus at its heart, The Ship has a weekly
programme of events. This includes a quiz night every Thursday,
live music at the weekend from a well-known local DJ, as well as a
children’s craft fun day and rock ‘n’ roll bingo every Sunday.

In 2023, the pub underwent a six-figure investment to

transform its interior and develop a new beer garden.

The Coach House

Greene King pubs’ Urban venues sit in the hearts of towns and
cities across the UK. Many of these pubs date back centuries
and have rich and varied stories to tell.

Preserving the heritage of these pubs is incredibly important.
One of our most historic sites is The George in Southwark, which
was serving customers in the 1600s and has continued to do so
right up to the present day. Famous past visitors range from
Charles Dickens, Winston Churchill and Princess Margaret to
Beyoncé and Madonna.

In 2023, we invested a six-figure sum in The Coach House, which
sits in the same courtyard as The George and shares outdoor
seating. The Coach House mirrors The George’s format but
allows us to give customers more options, including showing live
sport, allowing The George to let its history take centre stage.

The new-look pub opened in the autumn and has already proved
to be a particularly popular spot for tourists, while also allowing
us to unlock more trading opportunities from the George.

22 Greene King Limited | The Year in Review - 2023

Partnerships & Ventures

We are delighted with the significant revenue
growth seen in 2023, which was driven through
investment in Venture Brands, asset optimisation
and growth in our franchise business. Looking
forward we plan to continue investing in our
Pub Partners business alongside significant
planned investments in our collection of
Venture Brands.

Wayne Shurvinton, Managing Director,
Partnerships & Ventures

REVENUE

£420.9m

ADJUSTED EBITDA

£106.0m

ADJUSTED
OPERATING PROFIT

£78.3m

The Partnerships and Ventures
division was created this year. It
contains our leased, tenanted and
franchise pub operations alongside
various other businesses that operate
more independently outside of Greene
King’s core offer and target growth
sectors of the market.

Our structure
The division totals 1,125 venues, bringing
together our long-established Pub
Partners business unit with other venture
propositions. These include Hickory’s
Smokehouse, Metropolitan Pub Company,
Crafted Pubs, and our Hotels business.

Measuring our performance
Partnerships and Ventures grew revenue
by 23.2% in 2023. This was driven by
our investment in Venture Brands, asset
optimisation, and growth in our franchise
pub models. It made an adjusted
operating profit of £78.3m.

Investing in our communities
Development capital expenditure for
the division totalled £28m in 2023.
Investment activity focused on maintaining
and improving the quality of assets in the
core estate, while also optimising assets
through conversions and brand building
investments. In particular, this included
investments in our leased and tenanted
pubs, further rollout of the Hive Pubs
franchise format, and targeted
transformations of pubs into new
Hickory’s Smokehouse restaurants.

Pub Partners
This makes up the bulk of venues within
the Partnerships and Ventures division, with
its pubs continuing to generate significant
and stable cashflow for the group. There
are 932 leased and tenanted pubs and we
have significantly increased our number of
franchise pubs this year to 52 sites.

This growth has been driven by the
continued rollout of our Hive Pubs model,
which comprises well-invested assets
converted from our leased and tenanted
estate or from our fully-managed pub estate.
The 2023 openings have delivered strong
returns and there is a healthy pipeline of
new conversions planned.

Hickory’s Smokehouse
Greene King first invested in Hickory’s
in October 2022, bringing it into the
Partnerships and Ventures division.
Since our initial investment, this business
continues to go from strength to strength;
the core operation is performing in line
with expectations while also delivering
successful conversions across four former
Greene King managed pubs during 2023.

The business now consists of 23 restaurants
across the Midlands and the North West of
England and is set to grow further in 2024.

Venture Hotels
Our Venture Hotels business brings
together 39 venues to enable us to
focus on maximising the returns of our
accommodation-led assets. During 2023,
we announced a new premium brand called
Everly, with its first hotel in Rottingdean
due to open in summer 2024.

The alignment of our hotels to new brand
propositions will ensure that we continue
to maximise returns from this estate.

Metropolitan Pub Company
This has 69 pubs, mostly in London.
The business operates premium food
and drink pubs in urban and suburban
locations, with a targeted focus on
investment during the year.

Crafted Pubs
This is a new premium dining concept
created by Greene King. Following significant
investment, it opened its first site in 2021
with The Boat in Catherine-de-Barnes.
The concept allows for targeted
premiumisation of existing pubs within
the Greene King estate; by the end of
2023, there were six Crafted Pubs
across the country.

The brand connects two key parts of our
strategy: growth through compelling brands,
and asset optimisation, with pubs transferred
from other parts of the managed pub estate.
Two further sites were opened in 2023:
The Cart and Horses in Winchester and
The Prince of Wales in Esher.

Looking ahead
We expect to continue investing in asset
optimisation and expanding our Venture
Brands. This will include the continued
rollout of Hickory’s Smokehouse, the
opening of our first Everly hotel in East
Sussex, building our franchise estate, and
supporting our leased and tenanted
partners with significant investment
into their pubs.

24 Greene King Limited | The Year in Review - 2023

Pub Partners:
The Six Bells in Shinfield

Having a thriving leased and tenanted estate allows us to partner
with outstanding pub operators from across the country. They bring
their own talent and expertise in running great pubs and, in turn,
receive the backing of Greene King’s industry experience and
ability to invest in their businesses.

A great example of this in action in 2023 has been the Six Bells
in Shinfield, near Reading. Operated since 2018 by licensee Sachin
Singh and his business partner Sunil Sharma, The Six Bells is a
popular and successful destination pub. The pub is known locally
for its family-friendly atmosphere and live sport offer, combined
with excellent North Indian cuisine and traditional pub food
served in its restaurant.

To support Sachin in expanding his successful business,
Greene King Pub Partners invested £300,000 to upgrade the
pub. The investment gave it an all-new dedicated sports area, a
significantly improved beer garden and also an extension, which
gives the pub a new, private hire space and additional restaurant
covers. The refurbished and upgraded pub can now cater for private
event hires such as weddings and corporate lunches and dinners.
Alongside this, the improved sports area drives further footfall and
volume for major sporting events, while the upgraded garden has
doubled capacity from 100 to 200 covers outside, enabling the
pub to fully benefit from summer trading and good weather.

Sachin has also introduced an events programme at the pub
to further boost trade, which includes a Bollywood night and a
regular quiz night. Alongside this, he and his bar team have added
cocktails to their menu, further driving footfall and volume in
their pub business.

Greene King Pub Partners
invested £300,000 to upgrade
the pub.

Sunil Sharma (left) and Sachin Singh (right) at the Six Bells

Hive Pubs

After launching our very first Hive Pub in 2021 at the
Maldon Grey in Sudbury, we finished the year fast approaching
our 50th Hive Pub.

Consisting of transfers from our leased and tenanted estate
or from our managed estate, these pubs are well-invested, each
one offering an opportunity for a new franchisee to take their
next step on their hospitality career.

During this time, the concept has evolved in line with its
expansion, with a new menu launch in 2023 and special offers
tailored to the needs of different Hive Pubs.

This includes developing a core menu, a simplified menu and
also an enhanced menu, so that franchisees can tailor their
food offer based on the needs of the community they serve.

We have introduced a series of signature dishes, exclusively
available in Hive Pubs, that all feature ‘Hot Honey’. These sit
alongside other Hive Pubs offers, such as Pizza and Moretti
Wednesdays and a steak dinner for two offer on Thursdays.

Under the Hive Pubs franchise agreement, we offer the licensee
a ready-to-trade pub at a low entrance cost. They then have a
minimum guaranteed income as well as a percentage of food
and drink sales. On top of this, they receive a share of the
profits in their pub and can earn a bonus as well.

More Hive Pubs are planned for 2024 as well as a new franchise
concept to target a different segment of the market.

Under the Hive Pubs franchise agreement, we offer the licensee

a ready-to-trade pub at a low entrance cost. They then have a
minimum guaranteed income as well as a percentage of sales.
On top of this, they receive a share of the profits in their pub.

Jez Wright, The Westbury Tavern

26 Greene King Limited | The Year in Review - 2023

Hickory’s Smokehouse

Four pubs underwent transformational, seven-figure investments
in 2023 to become new Hickory’s Smokehouse restaurants,
bringing to life Greene King’s strategy driver to optimise assets.

The sites were all located within a reasonable distance of existing
Hickory’s restaurants. This allowed the Hickory’s team to give
proper care and attention to each investment and thoroughly
support new team members as they began their Hickory’s journey.

Each investment meant a significant increase in the size of the
venue; overall, we have created more than 250 new jobs across
these four sites, allowing Hickory’s to support local economies
whenever a new restaurant opens.

The new restaurants in 2023 are located in and around
Huddersfield, Derby, Thornton-Cleveleys and Wrexham.

All four sites have performed strongly since opening and received
very positive customer feedback through online reviews.

More openings will follow in 2024, with the number of new
openings projected to increase significantly compared to 2023.

Each investment meant a significant increase in the size of the

venue; overall, we have created more than 250 new jobs across
these four sites, allowing Hickory’s to support local economies
whenever a new restaurant opens.

Metropolitan Pub
Company

In 2022, Metropolitan Pub Company expanded to Glasgow’s
West End with the acquisition of three iconic restaurants,
including the Stravaigin. This venue is a cultural landmark but
required investment. To retain its independent spirit, we took
great care when planning the refurbishment, which proved to be
the right decision as the Stravaigin went on to enjoy a successful
2023. The investment enhanced the elements of the pub that
made it so distinctive while also updating and improving it,
including creating a new basement wine bar.

In November, the Stravaigin was named Gastropub of the Year
at the annual awards ceremony hosted by the Scottish Licensed
Trade News (SLTN). The award is presented to a venue that
delivers on “high-end pub food with a quality drinks range to
match. A top tier menu offering, with first rate friendly service
in a welcoming pub environment”.

Venture Hotels

In November, we were excited to announce the launch of a new
sustainable hotel concept: Everly Hotels Collection. The collection
will feature hotels in vibrant, destination-led market towns across
the UK and focus on affordable luxury.

The first Everly Hotel will be The White Horses in Rottingdean,
near Brighton in East Sussex. Opening in the summer of 2024,
it will have 32 bedrooms and 290 covers, with a food menu
focused on local produce.

Crafted Pubs

The Prince of Wales in Esher, our sixth Crafted Pub, opened in
early December following an investment of more than £1m.
The latest addition to this premium collection of pubs has
made a strong start since opening, exceeding expectations
both on sales and profit.

The Prince of Wales in
Esher, our sixth Crafted Pub,
opened in early December
following an investment
of more than £1m.

28 Greene King Limited | The Year in Review - 2023

Brewing & Brands

I’m proud to have been part of another exciting
year for our brewing and distribution teams where
we’re positioned as the market leader in the cask ale
sector. Our portfolio of new premium brands also
went from strength to strength, gaining continued
support from our customers and numerous quality
awards and accolades.

Matt Starbuck, Managing Director,
Brewing & Brands

REVENUE

£228.7m

ADJUSTED EBITDA

£32.2m

ADJUSTED
OPERATING PROFIT

£21.3m

We brew beers at our two breweries,
distributing and selling them across
the UK and overseas. Our Westgate
Brewery in Bury St Edmunds, Suffolk,
and our Belhaven Brewery in Dunbar,
East Lothian, brew renowned beers
including Greene King IPA, Old
Speckled Hen, Abbot Ale, Ice Breaker
and Belhaven Best.

We also develop new beers to reflect
changing tastes, with our premium
beers Level Head and Flint Eye
seeing further expansion in 2023.

Our structure
After brewing our beers, we supply them
into the entire estate of Greene King
pubs, both managed as well as leased
and tenanted. We also sell our beers to
independent, free-trade pubs across the
country. We have strong relationships with
supermarkets and other drinks retailers with
significant volumes of our beers packaged
up for customers to enjoy at home. We also
have an export business that sees our beers
transported to countries across the world.

Measuring our performance
Our revenue in 2023 of £228.7m was
9.8% higher than the previous year, with
adjusted operating profit up 3.4%.

Despite 2023 being a year of persistent
macroeconomic uncertainty, the business
pressed forward with its strategic ambitions,
which are underpinned by developing brilliant
beers, brilliant brands and brilliant people.

This was a year of high inflation, which
heavily impacted the brewing industry.
Raw materials, canning, utilities and
distribution all increased in cost. Despite
absorbing high levels of inflation ourselves,
some of these cost increases required us
to increase prices on our own products.

However, revenue growth was not caused
solely by inflation; it was also driven by
increases in the volume of our beers
sold in pubs and other venues.

Investing in our products
We invested significantly across our business
to ensure ongoing operational excellence,
including a significant spend at our Belhaven
Brewery. This investment ranged from
product innovation, such as our pins
production, to operational efficiency, such
as installing new centrifuges in our brewery.
It also included improving our cellar service
equipment, health and safety enhancements,
and the ongoing development of our new
distribution centre on the outskirts of Bury
St Edmunds. In addition, we invested in
relaunching our renowned Belhaven Best
and Belhaven Black beers in Scotland with a
new, premium design; the relaunch coincided
with Belhaven being the official beer
sponsor at the Edinburgh Fringe Festival.

Looking after our customers
We maintained a close focus on our
customer-first approach, consistently
providing high-quality products and
service to our whole range of customers.

We measure successful deliveries as the
percentage delivered on time and in full,
and this year it increased by 0.9ppts from
2022 to 95.7% in 2023. We also saw a
100% quality score in the Bury St Edmunds
brewery, which was up 5ppts on 2022.

Furthermore, our beers attained
independent recognition, earning multiple
awards across our portfolio. Notably, Ice
Breaker received three stars at the Great
Taste Awards, while Abbot Ale secured
Gold in the Premium Bitters category
at the Great British Beer Festival.

Engaging our people
We saw the highest-ever response rate
to our annual employee engagement
survey, with more than 600 participants,
representing a 79% response rate.

Our sustainable engagement result improved
by 6ppts from 2022 to 78% in 2023, and
business pride rose by 3ppts to 85% in
the same period.

Looking ahead
Our focus on the year is to build on the
strong work of the past year: growing
premium beer volumes; delivering share
of growth across ale markets; further
improving our operational excellence;
and investing in upskilling our people
and enhancing our culture.

30 Greene King Limited | The Year in Review - 2023

Developing premium
craft beers

Following the launch of our premium craft portfolio in 2022, with
Level Head Session IPA and Flint Eye Dry-Hopped Lager, the last
year has been focused on investing and growing distribution.

When we launched these beers, we spent time building brand
loyalty from the outset by initially placing them into smaller
numbers of our London pubs and then gradually rolling them
out further.

This has helped to build a following and has also allowed us
to gauge the reactions of customers in our Greene King pubs
before making them more widely available.

In the early part of 2023, we launched these beers into Tesco
and Sainsbury’s; by the end of the year they were on sale in
every major grocer.

We have also seen greater engagement with our own Greene
King pubs, enabling us to expand our distribution of these beers
substantially across our own managed estate, as well as leased
and tenanted pubs, independent pubs and with other managed
pub companies.

We also invested in a major marketing plan. Spanning out-of-home,
social, digital and television channels, it reached over 15 million
people. TV advertising was activated across the Women’s Football
World Cup, including during the final game.

In addition, as proof of the quality and credibility of our craft
portfolio, both Flint Eye and Level Head secured medals at the
World Beer Awards 2023, with Level Head securing a silver
award for its category.

We were thrilled to close the year with our premium craft
portfolio selling over 5m pints since its launch and with more
than 2,000 venues serving our craft beers.

We ended the year having improved our position in the craft
market, securing the number four spot for volume and value
among UK craft brewers.

We were thrilled to close the

year with our premium craft
portfolio selling over 5m pints
since its launch and with more
than 2,000 venues serving
our craft beers.

Championing cask ale

As the country’s largest cask ale brewer, we continue to promote
and invest in this historically significant segment of the UK beer
market, bringing fresh cask ales to pubs and bars across the country.

Rejuvenating our seasonal ale offers this year led to sales volumes
of these beers increasing by 25% compared with 2022. We also
invested a seven-figure sum in launching 4.5-gallon pins into the
market in time for summer, making us the UK’s first major
brewer to invest in this smaller 36-pint cask vessel.

The rationale behind this initiative was to help pub operators
minimise wastage and encourage even those with smaller
throughput to stock cask on the bar or be able to add
further range with a lesser volume.

Pins were launched with our July seasonal cask ales, Ale Fresco
and New Tricks, which was a collaboration with fellow Suffolk
brewer Nethergate Brewery.

The 4.5-gallon vessel was then available to order for nearly all
seasonal calendar ales, providing a brilliant opportunity for
operators to showcase different styles and flavours of cask
ale for their customers to taste.

Cask ale is part of our heritage and the core of a great pub,
and we continue to invest and innovate to secure its future.

The launch of pins has proved a great success for the brewery.
It has enabled us to grow cask stockists across the year, with
overall stockists of seasonal calendar ales up 20% compared
with the previous year.

FRESH CASK ALE RELEASES 2023

JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST

SEPTEMBER

OCTOBER

NOVEMBER

DECEMBER

32 Greene King Limited | The Year in Review - 2023

Environment, Social
and Governance

At Greene King our purpose is to pour
happiness into lives, and that means leaving
a lasting positive impact on the communities
we serve, our people and the environment.
We’re investing our time and capital to make
improvements for generations to come.

Assad Malic, Chief Communications
and Sustainability Officer

Environment

Social

GIVING MILLIONS OF
PEOPLE BETTER LIVES
• Macmillan Cancer Support
• No-One Alone programme
• Calling Time on Racism

manifesto

• Modern Slavery

PROVIDING GOOD
WORK FOR EVERYONE

• Diversity and Inclusion
• Social Mobility
• Financial Support Scheme
• Apprenticeships

HELPING OUR CUSTOMERS
MAKE MORE SUSTAINABLE
CHOICES

• Pub environment
• Menu innovation
• Food waste
• EV charging
• Biodiversity
• Responsible sourcing
• Recycled packaging / plastics

IMPROVING OUR OWN
OPERATIONS AND VALUE
CHAIN THROUGH NET
ZERO TARGETS
• Renewable energy
• Energy efficiency measures
• Circular business model
• Working with suppliers

Governance

INCREASING CLARITY,
TRANSPARENCY AND
RESPONSIBILITY

• Increase clarity, sharper focus
and embed aligned activity
into business as usual across
the whole of Greene King

• Improved disclosures
• Targets in line with Science

Based Targets initiative

• External ratings
• Enhanced responsibility
measures across retailing
and sourcing

Greene King for Good conference

After creating an Environment, Social and Governance (ESG)
strategy in 2021 and 2022, during this last year we began
to deliver on some of our strategic actions.

We prioritised developing our roadmap to net zero, pursuing our
long-term community ambitions, and enhancing our governance
across a range of key issues.

Key to this has been the introduction of Environment, Social and
Governance leadership forums. These include our working group
leads, who are subject matter experts. The new forums report
recommendations to an ESG Board, which is chaired by the Chief
Communications and Sustainability Officer and includes the Chief
Financial Officer and Greene King pubs’ Managing Director.

The board’s duties include:

• Overseeing development of Greene King’s ESG strategy.

• Identifying and approving both short-term and long-term ESG
objectives and the key performance indicators (KPIs) required
to deliver the strategy and to review its reporting.

• Coordinating and overseeing the activities of the ESG working
groups and acting as an escalation point where necessary for
relevant working across different teams.

• Developing and maintaining Greene King’s ESG policies and

practices to ensure they remain effective and compliant with legal
and regulatory requirements and industry standards, and then
recommending these to the Greene King Executive Board for approval.

While emotional connection is the binding thread through our
environment and social strategy driver, having this governance
structure to underpin it helps to drive the change needed to
deliver our clear targets.

Our focus on social responsibility was further developed in the
year with the implementation of the first national pub company
accreditation scheme with Best Bar None and the publishing of
our modern slavery three-year action plan.

Greene King Engage
In October 2023, we introduced a supplier engagement platform
called Greene King Engage at a conference for 200 key food, drink,
IT and property suppliers.

During the conference, our Chief Executive Officer and Chief
Communications and Sustainability Officer talked about reaching
net zero and reducing indirect greenhouse gas emissions, as well
as the importance of human rights within our supply chain.

All businesses invited to the launch of Greene King Engage were
then migrated onto the platform, with 94% completing an initial
kickstart assessment by the end of 2023. This survey covered
questions on carbon emissions, human rights, biodiversity and
water, waste and packaging, responsible sourcing, materials of
concern and environmental management. All remaining key
suppliers will be added to Greene King Engage by summer 2024.

JANUARY
Approval of near
term Science-based
Targets

FEBRUARY
Greene King addresses
National Farmers’ Union
conference

APRIL
Property decarbonisation
test and trial activity
commences

JUNE
Launch of Pint of
Perspective, Inclusion
and Diversity podcast

JUNE
Modern Slavery
three-year action
plan published

SEPTEMBER
Roll out of Voltage
Optimisation across
managed pubs

OCTOBER
Greene King academy
training kitchen opens
in HMP Grampian

NOVEMBER
Launch of Greene King
Engage platform at ESG
Supplier Conference

NOVEMBER
Greene King becomes the
first pub company to complete
the national Best Bar None
accreditation scheme

DECEMBER
Greene King fundraises
£3.8m for Macmillan
Cancer Support in 2023

34 Greene King Limited | The Year in Review - 2023

Environment

Actions in 2023

In early 2022, we decided to put climate science at the
heart of our environment strategy. We committed to set
near-term and net-zero targets through the Science Based
Targets initiative (SBTi), annually reporting our progress
to reducing our greenhouse gas (GHG) emissions.

In February 2023, the SBTi approved our near-term targets to
halve GHG emissions by 2030. In addition, we have publicly stated
our intention to reach carbon net zero by 2040 and will also
seek approval for this target via the SBTi. Alongside this, we
remain committed to halving our food waste from 2019
levels by 2030, in line with the Courtauld Agreement.

The two focus areas of our net zero strategy are:

• Helping our customers to make more sustainable choices.
We see our role as supporting our customers to reduce
their environmental footprint. We can do this in several ways:
adapting our pub environment so that sustainability lies at its
heart, innovating across our menus with lower carbon dishes,
and helping customers reduce food waste. We can also source
responsibly, provide electric vehicle chargers in our car parks,
enhance biodiversity in our gardens and use low-carbon
packaging solutions.

• Improving our own operations and value chain through net-zero
targets. Through our near-term science-based target and our
public commitment to our net-zero target, we will drive our
carbon footprint down by procuring renewable energy and
introducing energy-efficient measures and solutions. We will
also work with our suppliers on their emission hotspots and
introduce new and innovative circular business solutions.

Environment targets

• Reduce absolute scope 1 and 2 greenhouse gas emissions

(GHG) 50% by 2030 from a 2019 base year

• Reduce absolute scope 3 GHG emissions 50% by 2030

from a 2019 base year

• Reduce food waste by 50% by 2030 from a 2019 base year

• Reach carbon net zero by 2040

Vertical farming, Fischer Farms

Solar panels, Cherry Tree Farm

Property decarbonisation
We have invested more than £7m in decarbonising projects this year:

• We have rolled out voltage optimisation equipment to 308 of our
managed pubs in 2023 and will reach 600 in 2024. This will deliver
reductions in our electricity usage and should reduce our carbon
footprint by 7,000 tonnes of CO2 and CO2 equivalents.

• We installed technology into our Farmhouse Inns’ kitchens that

gives us real-time data on energy usage and analysis on equipment
use, allowing targeted actions to reduce energy consumption. The
project is estimated to save 2.5 gigawatt-hours of energy annually
– enough to power 2.5m homes for one hour – and improve the
longevity of equipment through proactive maintenance.

• We began trialling solar panels at our Burton-on-Trent support
centre and at one of our pubs, Cherry Tree Farm near Derby.
We anticipate that these installations will provide valuable
learnings for any future rollout of the technology.

• We trialled air sourced heat pumps at two of our pubs, supplying
heating and water with low-to-nil emissions. Over the coming
months we will monitor the impact on energy consumption,
and customer and team comfort, in order to understand the
longer-term viability of heat pumps in the estate.

Sustainable farming and procurement
We have made steps towards more sustainable procurement this year:

• In April we announced a vertical farming partnership with
Fischer Farms. Vertical farming allows crops to be grown all
year round in undercover, racked trays stacked in tall layers.
This bio-secure farming method has a small land footprint
compared with traditional farming and is fuelled by sustainable
energy. With controlled light, temperature and irrigation, it
simulates the best growing conditions, resulting in high-quality
crops. In 2023 we have seen the rollout of vertically-farmed
basil, watercress and chives into our managed pubs.

• During 2023 we introduced a new policy that no air-freighted
fruit and vegetables would be allowed into our business by
March 2024; by September 2024 we will expand the policy
to include other products or ingredients.

Brewing
We have sought to implement operational efficiencies in our
Bury St Edmunds and Dunbar breweries, as well as across our
distribution network. This included installing new equipment in
our Bury St Edmunds brewery that is more energy efficient
and uses less cooling water than before.

Food waste
We are committed to halving food waste by 2030 from a
2019 baseline:

• This year, we ran a trial to assess more accurate methods for
measuring food waste to better understand the sources and
causes. We are now analysing the results.

• We continued our partnership with the popular app ‘Too Good
To Go’, which allows members of the public to buy leftover food
from pubs and restaurants that would otherwise go to waste. We
estimate this helped to save around 261,000 meals this year, with the
partnership saving more than 500,000 meals overall since it began.

Water
We ran two water efficiency trials this year.

• We installed Automatic Meter Reading (AMR) loggers at 50 of
our sites. These enabled us to take readings of water usage at
15-minute intervals, enabling the early identification of leaks and
coordination of repairs and maintenance activities as appropriate.
Over 16,700m3 of water savings were identified in the trial.

• We also ran a trial for using low flow shower heads and toilet

flow regulators at two of our hotels and one of our larger pubs to
understand the impact on water savings and customer experience.

Biodiversity
In 2023 we completed several projects to improve biodiversity.
These included initiatives providing habitats for insects and birds,
and planting trees and wildflower meadows. We also collaborated
with the Gloucestershire Canal & Wildlife Trust at our pub
Fromebridge Mill to clear sections of the local river in order
to encourage wildlife to return.

Electric vehicle charging
We continue to roll out EV charging points in our car parks, with
648 chargers now installed. This can provide an invaluable resource
for communities, either in rural areas where there is not easy access
to charging points or in more urban areas where homes have no
off-street parking and therefore home-charging is less feasible.

Packaging
Our ongoing sustainability dialogue with suppliers means we are
always looking for ways to reduce packaging:

• We removed over a million pieces of plastic cutlery and three
million disposable plastic glasses from our properties in 2023.

• We replaced our plastic cake takeaway boxes with a cardboard
solution, which will remove over a million plastic boxes from
our estate.

• We also removed single-use items normally used at Christmas,
such as party poppers and gift boxes, equating to more than
800,000 single-use items.

• We helped one of our suppliers save 50 tonnes of plastic waste
annually across all their customers, including Greene King, by
switching to using FSC-certified paper packaging.

• In January 2023, we collected approximately 24,000 empty

sweet and chocolate containers through our Tub2Pub circular
recycling scheme. This scheme lets people bring their containers
to our pubs after Christmas for processing, thereby diverting
more than three tonnes of plastic away from landfill. The
granulated plastic is repurposed into garden furniture and
we donated proceeds from the plastic sale to our charity
partner, Macmillan Cancer Support.

The Anchor, Southwark

Explainer: Greenhouse Gas emissions

• Scope 1 is direct emissions from the fuels we use in our
breweries, pubs, restaurants, hotels and offices. It also
includes emissions from vehicles owned by Greene King,
including company cars.

• Scope 2 is indirect emissions associated with the
generation of electricity consumed in our sites.

• Scope 3 is all other emissions generated both upstream

and downstream in our supply chains.

36 Greene King Limited | The Year in Review - 2023

Social

Actions in 2023

We believe in challenging social barriers, creating
opportunities for many by welcoming anyone to build a
career with us, regardless of education or background.
This was another positive year of progress against our
social strategy, with further development across our
pillars of charity, community, social mobility, inclusion
and diversity and wellbeing.

Our vision has a powerful social purpose at its heart.
Our social ambition is to:

• Give millions of people better lives, and

• Provide good work and opportunities for everyone

Social targets

• Raise £18m for Macmillan Cancer Support between

2012 and 2025.

• By 2025 have supported 5,000 new apprentices since

2022, taking us to a total of 20,000 apprentices supported.

• Support 300 more prison leavers between 2022 and 2025.

• From 2022 to 2025, have supported 100 interns with
Special Educational Needs or Educational Health Care
Plans into work experience or employment.

• Help 1,000 young people from underprivileged

backgrounds through The Prince’s Trust and other
partnership programmes.

• Increase Black, Asian and minority ethnic representation
in the business by 10% between 2022 and 2030. In the
same timeframe, increase representation in the leadership
team from 6% to 12%, in senior management from 3%
to 10% and among our managers from 4% to 10%.

From 2022 to 2025,
have supported 100 interns
with Special Educational
Needs or Educational
Health Care Plans into
work experience or
employment.

Fundraising total for Macmillan

Charity
2023 was our highest fundraising year to date, raising £3.8m for
Macmillan Cancer Support, an increase of £800,000 over 2022.
This represented the vast majority of our fundraising.

We achieved this total by renewing our focus on ‘little and often’
donations, with every function and division in the business setting
a yearly target. Significant fundraising uplift came from our support
centres as well as from our Urban Pubs and Hungry Horse estate.

You can read more about this year’s fundraising for Macmillan
on page 38.

Community
Our pubs, breweries, depots and support centres lie at the heart
of their communities and provide an important role in bringing
people together around a collective sense of belonging. This year
we have seen initiatives that helped cement this important
partnership between pubs and their communities:

• Our Christmas Community Table initiative ran for its second year
in 2023. It saw 219 pubs offering community tables of six people
to those who would otherwise be alone on 25th December. We
donated 831 Christmas lunches to customers in our communities,
bringing them together to enjoy the day with others in our pubs.

• Our Venture Hotels team started a trial with Carefree, a charity
that transforms vacant hotel rooms into free stays for carers.
During the six-month trial, we donated two-night Bed and
Breakfast hotel stays to carers needing a break.

• Our grassroots sport community grant scheme, ‘Proud to Pitch In’,
distributed £253,000 in grants to 81 clubs in 2023. The scheme
provides grants up to £4,000 for equipment and the cost of
running community sports groups. To date, we have donated
£645,000 to 238 clubs, enabling 59,000 people to continue to
play the sports they love in their community.

• During the year, £366,000 worth of food, equating to 97,500kg,
was donated direct from depots to foodbanks including Bread
& Butter Thing, The Felix Project and City Harvest. We donated
c.500 tablets to 2econd Chance to be refurbished and re-sold
at affordable prices, providing essential funding and also training
for disabled people.

• We continued our support for trade charities including PubAid,
Best Bar None, Only a Pavement Away and Pub is the Hub, as
well as local charities close to our support centres in Bury St
Edmunds and Burton on Trent. Examples of support included
funding a Therapy Garden at Wedgwood House, the mental
health hospital in Bury St Edmunds and fundraising for Burton
Hope in Burton-on-Trent.

Social mobility
In 2022 we made a number of social mobility commitments as
part of our ‘Untapping Potential’ report and 2023 saw us make
good progress on all these commitments.

• In 2023, 347 apprentices achieved their qualification with a
further 944 new apprentices beginning an apprenticeship.
We have now supported 17,200 apprenticeships since 2011.

• We have also supported 2,275 apprenticeships out of the

5,000 by 2025 target we set ourselves in 2022.

• Our Supported Internships programme helps young people
with special educational needs to gain work experience.
Working alongside our partners, Landmarks Specialist College
and Mencap, the programme continued to expand during the
year. We provided 30 supported intern placements in 2023,
with 23 completing the internship and over 80% securing
permanent employment with Greene King.

• Greene King continues to take a leading role in private sector
recruitment and education for prison leavers through our
‘Releasing Potential’ programme. We recruited 62 prison leavers
in 2023, making a total of 222 since the programme started in
2019. We continue to work closely with our partners including
Only a Pavement Away, and this year we were named the
charity’s first strategic partner.

• In December we opened a second training kitchen within a
prison, at HMP Grampian in partnership with the prison and
the Scottish Prison Service.

• We are one of a few employers piloting prison apprenticeships.

• In the past 12 months, we have delivered Greene King

employability events in over 60 prisons. We were the leading
hospitality employer at the Ministry of Justice and New Futures
Network Hospitality Drive, attending 26 prisons and engaging
with 232 serving prisoners during a two-week period.

Inclusion and diversity
During 2023 we maintained our momentum
toward everyday inclusion with the aim of
creating an environment and culture where
everyone can feel like they belong.

• The year saw further rollout of our

Reverse Mentoring programmes and
further growth and influence of our four
Employee Led Inclusion Groups (ELIGs).

• We further embedded our inclusive
leadership training programme.

You can read more about our inclusion
and diversity work this year, including our
public commitment to reach gender parity
at leadership levels by 2030, on pages 10
and 11 of this annual review.

Wellbeing
Our team member wellbeing efforts focused on awareness
campaigns and providing practical support.

• We raised awareness of the support available from our Employee
Assistance Programme, as well as our trained mental health first
aiders. During the cost-of-living crisis, we further highlighted all
the discount schemes that are available for employees with
high-street retailers.

• We launched a gender identity policy and menopause and

menstruation policy, both supported by awareness guides, and
enhanced our family-friendly policies, including paternity and
adoption leave.

• We continued to offer support and financial assistance through

our Team Member Support Scheme. This is administered
independently on our behalf by the Licensed Trade Charity to
support any team members facing financial hardship. In 2023,
£76,349 of support was paid out in grants.

Prison training kitchen, HMP Grampian

In 2023, 347 apprentices achieved their qualification with a

further 944 new apprentices beginning an apprenticeship.

38 Greene King Limited | The Year in Review - 2023

Macmillan Cancer Support

The King’s Coronation

It was a fantastic year for the Greene King and Macmillan
Cancer Support partnership, with our teams and customers
raising £3.8m for the charity - the largest amount we have
raised in a single year to date.

It was £800,000 more than our previous record in 2022 and
brings the total raised for Macmillan to over £17m since the
partnership began in 2012.

The first £1m raised in the year went towards the charity’s
emergency grants appeal. This provides cash grants for people
living with cancer to help them manage unexpected or additional
costs related to their diagnosis during the cost-of-living crisis.

Throughout the year, the calendar of fundraising events was busy,
varied and innovative and involved thousands of team members,
support staff and customers across the country.

Pubs were at the heart of celebrations for the Coronation
of King Charles III on Saturday 6 May 2023, just as they
would have been for Queen Elizabeth II’s in 1953.

To highlight the central role pubs have played at the heart of
communities throughout this period, we commissioned a report
looking at how the role of the pub has evolved across those
70 years, entitled: ‘Serving King & Country: The Great British Pub
at the Heart of Communities’.

Launched in April, a couple of weeks before the Coronation, the
report tracked the history of the pub. It also conducted survey-
based research to understand people’s attitudes to the pub today.

The report was launched at our pub The Kings Arms in Mayfair
and was attended by parliamentarians and journalists.

The £3.8m raised this year is £800,000 more than our previous

record in 2022 and brings the total raised for Macmillan to over
£17m since the partnership began in 2012.

Team members went above and beyond in tackling
challenges to raise the vital funds, including:

• A Sea to Summit challenge in Snowdonia

• Macmillan May fundraising campaign –

sparking individual events in hundreds of pubs
across the country

• A coordinated “Small Change, Big Quiz” event

held across Greene King pubs

• We Love Macmillan Nurses campaign

• Macmillan Coffee Mornings

It was not just the big fundraising events that helped
draw in these much-needed funds. A large proportion
of the fundraising was generated through the smaller
donations made via collection tins and through the 25p
donations that customers chose to add on at the till
via the Pennies system.

All these contributions combined to help raise the
amazing final total for 2023, with the Greene King
teams now galvanised and ready to go again in 2024.

The report examined pubs’ social and economic impact and the role
that they play in their communities, finding that:

OF BRITS THINK THAT PUBS ARE IMPORTANT
FOR LOCAL COMMUNITIES

SAY MEETING FRIENDS OR SOCIALISING ARE THE
MOST IMPORTANT REASONS FOR VISITING A PUB

LIVE LESS THAN A MILE FROM A PUB

OF BRITS SAY THAT BEING CLOSE TO A GOOD LOCAL
IS IMPORTANT WHEN CONSIDERING MOVING HOME

OF BRITS VISIT A PUB AT LEAST ONCE A MONTH

OF BRITS HAVE CELEBRATED OR WITNESSED
A NATIONAL MOMENT IN A PUB

OF 18-34 YEAR OLDS PLAN TO VISIT A PUB OVER
THE CORONATION BANK HOLIDAY WEEKEND

To mark the Coronation, we created a whole new beer,
available both on draught and in bottles. The limited-edition
4% ABV beer was an easy-drinking and refreshing golden
ale with bright tropical fruit notes.

40 Greene King Limited | The Year in Review - 2023

Financial Review

In order to support the long-term strategic
priorities, the group’s objective is to maximise the
strength and flexibility of its balance sheet, and to
maintain a capital structure which meets the short,
medium, and long-term funding requirements
of the business.

52 weeks
31 December
2023

Statutory

52 weeks
1 January
2023

YoY change

52 weeks
31 December
2023

£m

2,375.4

167.2

(122.0)

45.2

£m

2,176.4

249.2

(150.8)

98.4

9.1

(32.9)

(19.1)

(54.1)

£m

2,375.4

186.1

(122.3)

63.8

Adjusted

52 weeks
1 January
2023

£m

2,176.4

192.6

(125.7)

66.9

YoY change

9.1

(3.4)

(2.7)

(4.6)

Richard Smothers,
Chief Financial Officer

Income statement

Revenue

Operating profit

Net finance costs

Profit/(loss)
before tax

Revenue was £2,375.4m, an increase of 9.1% compared to the 52 weeks ending 1 January 2023, with increases in all four revenue generating
segments versus the prior period. This was due to increased levels of trading in the period as a result of continued recovery of the hospitality
industry post Covid that continued into 2023.

Greene King pubs revenue was up 9.6% to £938.4m, Destination Brands revenue was up 2.2% to £787.4m, Partnerships & Ventures revenue
was up 23.2% to £420.9m and Brewing & Brands revenue increased 9.8% to £228.7m.

The group’s operating profit declined during 2023 compared to 2022. This was primarily due to a change in nature of adjusting items and the
continued pressure on profit caused by the rising cost of inflation and the global macroeconomic headwinds that particularly affected food,
team and utility costs.

Group adjusted operating profit by segment

Greene King pubs

Destination Brands

Partnerships & Ventures

Brewing & Brands

Corporate

Group adjusted
operating profit1

1. 2022 has been restated to reflect the new reporting segments.

52 weeks
31 December 2023

£m

121.7

47.5

78.3

21.3

(82.7)

186.1

52 weeks
1 January 2023
Restated1
£m

111.8

51.9

89.8

20.6

(81.5)

192.6

YoY
Change

8.9

(8.5)

(12.8)

3.4

(1.5)

(3.4)

Net finance costs before adjusting items were down 2.7% to £122.3m, primarily due to the partial refinancing of Spirit A5 and Greene
King A5 bonds in the prior period.

Profit before tax and adjusting items was £63.8m compared to £66.9m in the prior period. The group made a statutory profit before tax
of £45.2m (prior period: £98.4m profit), after adjusting operating costs of £18.9m (prior period: £56.6m credit) and adjusting finance income
of £0.3m (prior period: £25.1m charge).

Adjusted corporate costs are broadly flat on the prior period following a period of continued investment in central functions and the
long-term incentive and bonus plan.

Tax
The effective rate of corporation tax (before adjusting items) for the group is 24.9% (prior period: 16.2%) compared with the blended
UK corporation tax rate of 23.5%. Adjustments to the rate include permanently disallowable non-adjusting items (+0.9%) the effect of
Capital Allowances Super Deductions (-0.7%) and non-adjusting accounting movements on property, plant and equipment (+1.3%).
This resulted in a tax charge against operating profits (before adjusting items) of £15.8m (prior period: £10.8m). The adjusting tax credit
of £10.7m (prior period: £19.7m charge) is discussed under adjusting items.

The group generates revenue, profits and employment that deliver substantial tax revenues for the UK government in the form of VAT,
duties, employment taxes and corporation tax. In the year, total tax revenues paid by the group were c.£518m (prior period: c.£517m).
The group’s tax policy, which has been approved by the group’s board committee and which will be subject to regular review by the
board of directors of the group, has the objective of ensuring that the group fulfils its obligations as a responsible UK taxpayer.

Adjusting Items
Adjusting items were a charge of £7.9m (prior period: £11.8m credit), consisting of a £18.9m (prior period: £56.6m credit) charge to operating
profit, a £0.3m (prior period: £25.1m charge) credit to finance costs and a net adjusting tax credit of £10.7m (prior period: £19.7m charge).
Items recognised in the year included the following:

1. A net impairment charge of £10.4m (prior period: £29.9m reversal)
in relation to property, plant and equipment, and right-of-use
asset comprising £6.3m net charge (prior period: £0.9m charge).

6. £2.2m charge (prior period: £4.2m) in respect of professional

fees on corporate transactions and projects.

7. A gain of £1.6m (prior period: £0.1m loss) in respect of the

2. £1.8m (prior period: £nil) of employee costs, restructuring and

revaluation of investment property.

other legal and professional fees.

8. £4.1m credit in respect of insurance proceeds relating to

3. £4.2m net loss (prior period: £18.0m net profit) on disposal of

damaged assets (prior period: £4.3m).

property, plant and equipment and leases.

4. A net charge of £0.9m (prior period: £6.8m credit) in relation to

Covid. This includes a credit of £0.1m (prior period: £7.3m) on bad
debt provision reversals on both free trade loans and trade debt, a
£0.6m charge in respect of personal protective equipment written
off (prior period: £2.1m) and a £0.4m charge (prior period: £1.6m
credit) relating to Covid rent concessions (net of fees).

5. A net £1.2m gain (prior period: £3.3m charge) in respect of

Indirect Tax claims.

9. £0.3m income (prior period: £25.1m charge) for adjusting

finance costs which is fully in respect of interest on indirect
tax claims in the current year (prior period: £0.5m charge).

10. The adjusting tax credit of £10.7m (prior period: £19.7m charge)
represents an effective rate of corporation tax on adjusting
items of 57% after tax adjustments of £6.3m. These adjustments
include a credit of £6.7m for current and deferred tax
movements in the respect of the licensed estate, a £1.1m
credit for prior year adjustments and a debit of £1.2m for
permanently disallowable items.

42 Greene King Limited | The Year in Review - 2023

Cashflow

Balance sheet

Adjusted EBITDA1

Working capital (excluding adjusting cash items)

Net interest paid

Tax paid

Adjusted cash generated from operations

Core capital expenditure

Net repayment of trade loans

Repayment of lease liabilities

Free cash flow

Business acquisitions

Investment property expenditure

Net disposal proceeds

New build capital expenditure & freehold purchase

Receipt from a settlement of derivative financial liabilities

Adjusting items

Advance of borrowings

Net increase/(decrease) in cash and cash equivalents

1. EBITDA represents earnings before interest, tax, depreciation, amortisation and adjusting items.

52 weeks
31 December
2023
£m

52 weeks ended
1 January
2023
£m

329.2

42.7

(102.1)

(13.9)

255.9

(194.8)

(51.5)

9.6

(1.1)

4.4

(29.9)

25.0

24.6

32.6

321.1

25.6

(113.8)

(3.5)

229.4

(164.1)

0.2

(52.4)

13.1

(34.7)

(0.2)

19.9

(17.4)

8.6

(4.0)

7.7

(7.0)

Goodwill and other intangibles

Property, plant and equipment (inc. investment property and assets held for sale)

Post-employment assets

Net debt

Derivative financial instruments

Trade and other payables

Net IFRS 16 liability

Other net assets

Net assets

Share capital and premium

Reserves

Total equity

1 January
2023
£m

941.6

3,896.8

55.2

31 December
2023
£m

940.0

3,990.6

64.5

(2,109.1)

(2,115.0)

(30.7)

(459.6)

(54.8)

150.9

2,491.8

1,223.4

1,268.4

2,491.8

(24.4)

(412.4)

(37.4)

147.0

2,451.4

1,223.4

1,228.0

2,451.4

The full year adjusted cash inflow from operations was £255.9m
(prior period: £229.4m), demonstrating the strength of the group’s
trading performance despite a range of ongoing cost headwinds.
The group generated a free cash flow of £9.6m (prior period: £13.1m).
Overall the cash inflow for the period was £32.6m (prior period:
£7.0m outflow) after funding capital expenditure of £225.8m (prior
period: £181.7m) and rent payments of £51.5m (prior period: £52.4m),
offset by disposal proceeds of £4.4m (prior period: £19.9m) and a net
cash inflow on adjusting items of £25.0m which primarily relates to
cash received from HMRC in relation to VAT on gaming machine
income (prior period: £4.0m outflow).

There was a net cash advancement of borrowings during the
year of £24.6m (prior period: £7.7m).

The group delivered a full programme of both maintenance
and development capital expenditure, including investment in
IT infrastructure as well as a range of transformation and asset
optimisation projects. Net disposal proceeds of £4.4m were
generated from a small number of non-core assets.

In order to support its long-term strategic priorities, the group’s
objective is to maximise the strength and flexibility of its balance
sheet and to maintain a capital structure which meets the short,
medium, and long-term funding requirements of the business.

The principal elements of the group’s capital structure are its
£1,000m bank facilities, which were £900m drawn at the year end;
£1,500m revolving loan facility with CKA Holdings UK Limited, which
was £311m drawn at the year end; and a long-term asset-backed
financing vehicle.

At the balance sheet date current borrowings are up £518.3m on the
prior year; this is due to the CKA revolving credit facility and one of
the bank facilities maturing in November 2024 and December 2024
respectively. As outlined below, the CKA revolving credit facility
was renewed post year end.

In April 2024 the group renewed the unsecured revolving loan
facility with CKA Holdings UK Limited. The facility will be available
from November 2024 and will replace the existing one. Any amounts
drawn down bear interest at a fixed rate of 7% and interest is
payable following the end of each interest period which is typically
three months in length. Drawn amounts are repayable on maturity of
the facility in November 2028. The size of the facility remains
unchanged at £1,500m.

In December 2023 the group executed a new three-year £100m
revolving loan facility with DBS Bank. The purpose of the facility was
principally to provide funding for scheduled principal repayments
under the Greene King securitisation bonds in the context of the
majority of the group’s cash generated from operations having
been reinvested through capital expenditure in 2023.

At the year end, the Greene King securitisation had secured bonds
with a group carrying value of £1,019.5m (prior period: £1,073.7m)
and an average life of seven years (prior period: seven years), secured
against 1,460 pubs (prior period: 1,473 pubs) with a group property,
plant and equipment carrying value of £2,019.2m (prior period:
£1,995.0m).

The group maintained covenant compliance in the Greene King
securitisation throughout 2023, with all financial covenants being
passed in respect of each of the April 2023, July 2023, October
2023 and December 2023 test dates.

The group’s liquidity position remains strong, reflecting the resilience
of the group’s capital structure. The group’s average cash cost of debt
increased to 5.0% from 4.8% last period and, at the year end, 63.1%
of the group’s net debt was at a fixed rate. The Greene King secured
vehicle had a four-quarter lookback FCF DSCR of 1.7x at the year
end, giving 61% headroom to the covenant limit of 1.1x.

Overall, the group’s net debt excluding lease liabilities reduced in
the year by £5.9m to £2,109.1m.

Pensions
The group maintains four defined contribution schemes, three of
which are open to all new team members and one that was closed
to new contributions at the end of 2023, and two defined benefit
schemes, which are closed to new entrants and to future accrual.

In the prior year, the Spirit Pension scheme entered into a second
buy-in policy for c.£110m that provided insurance for a proportion
of its members. This takes the total insured value to c.£160m.

At 31 December 2023, there was an IAS 19 net pension asset of
£64.5m representing an increase of £9.3m since 1 January 2023.
The closing assets of the group’s two pension schemes totalled
£629.0m and closing liabilities were £564.5m, compared to
£633.0m and £577.8m respectively at the previous period end.

In the prior year, the membership data and demographic assumptions
were updated to reflect the latest triennial valuations completed for
both schemes in 2022. Also included in the remeasurement are key
assumptions relating to the discount rate of 4.5% (prior period: 4.8%),
RPI inflation of 3.1% (prior period: 3.3%) and CPI inflation of 2.5%
(prior period: 2.7%). Following the funding valuation in 2022 it was
agreed company contributions would be made into escrow,
total cash contributions in the period were £3.5m into escrow
(prior period: £4.1m of which £1.5m was paid into escrow).

Dividend
No dividend has been proposed by the board in the current
or prior period.

Registered office

Westgate Brewery, Bury St Edmunds, Suffolk, IP33 1QT