Yates drops 11% on trading warning

Shares in Yates slumped 11 per cent yesterday after the bar operator warned that trading had continued to be tough in January as punters stayed away from its high street spots.

"We had three bad weeks in the run-up to Christmas, then normal service was resumed – Christmas Eve and New Year's Eve were great days, and then tough times again," the chief executive, Mark Jones, said.

Sales, on a like-for-like basis in the five weeks to 5 January, were down 4 per cent – mainly thanks to a 9 per cent fall in sales at the 92 Yates Wine Lodges that are awaiting refurbishment.

"We're on high streets and, during the day, we're highly dependant on shoppers and traffic is down," Mr Jones said, adding: "There's also been an over-supply in our market."

In the 35 or so Yates Wine Lodges that have been refurbished, like-for-like sales were up 2.1 per cent over the key Christmas period, compared with a year-to-date increase of 5.4 per cent. There was a different story, however, at the company's portfolio of 19 Ha!Ha! bars, which recorded an 11.3 per cent improvement in like-for-like sales in the five-week period.

But the disappointing performance at its Yates Wine Lodges, located in town centres, forced the company to admit underlying trading this year would be beneath last year's. "January has seen a further downturn and, currently, no immediate market improvement is anticipated," it said. Its sharesclosed down 8.5p at 66p.

Mr Jones said: "I don't know whether people are out there buying sofas or DVDs but they're not drinking in pubs, in the same number that they were, on the high street."

He said he hoped the refurbishment of the group's remaining 92 Yates Wine Lodges would be completed by the end of 2003. While he said about five were up for sale, he noted: "The rest of them are very good sites, well positioned. It's just a question of getting round and sorting them out."