Brewer and pub operator Shepherd Neame says it is continuing to see "encouraging demand" from customers - but admits trading levels remain below pre-pandemic levels.

In a trading updating following the end of its financial year on June 25, the Faversham-based firm says overall trading for the 12 months was "in line with expectations".

It added like-for-like retail sales of the final six weeks of the period were up 13% on the same time last year, when full trading was permitted after lockdown restrictions were lifted.

But compared to the same period in 2019, figures were down 4.1%.

The company, which owns 299 pubs in Kent and the South East, says its coastal pubs and hotels were performing particularly well while its central London outlets were "still to see a full recovery" but added "footfall is improving".

Sales of of its own beer were up compared to 2021 by 2% but down 3% on 2019.

The company added the "inflationary environment is challenging" pointing to high costs in utility, energy related products and its supply chain.

It added it was having to "soften the impact" by "menu management and price increases".

However, its net debt has reduced significantly in the last year. Since its peak in December 2020, debt levels have fallen from £96.5m to £75.3m - its lowest level since 2018.

Jonathan Neame, CEO of Shepherd Neame said: "In spite of external economic headwinds, we remain optimistic we will continue to see similar levels of demand across the summer.

"We are mindful of the many challenges ahead, but the business and our team have demonstrated extraordinary levels of resilience in the last two years, and we have no doubt we have the skills and platform to find opportunities to grow and develop in the future.”