Brewery giant Shepherd Neame saw turnover and profits dip after the loss of a key contract and the costs related to a major refinancing deal, its latest financial figures reveal.

But the Faversham-based firm, which owns and operates 322 pubs across Kent and the south east as well as producing its own range of beers and ciders, says the last 12 months has delivered a "solid" financial performance.

And it says it is optimistic for the immediate future, despite the uncertainties caused by Brexit.

The firm was hit with a one-off charge of £10.8m related to the refinancing of its debt facilities, which took a toll on its annual results, along with the loss of contracts to brew Japanese beer Asahi and a supply deal with supermarket Lidl.

Group turnover, for the year ending June 29, 2019, reduced by 6.9% to £145.8, compared to £156.6m in 2018.

Underlying profit before tax was down by -0.3% to £11.4m which, says the firm, was "in line with expectations".

There was strong performance in its pub division with its 70 managed pubs accounting for nearly half of the group's turnover and been the subject of significant recent investment.

Like-for-like sales were up 3.2%, while the average income per managed pub rose by 6.6%.

Tenanted pubs, which account for 239 venues, saw life-for-like sales up 2.3% and average income up 3.3%.

Its brewing business, in transition following the loss of the Asahi and Lidl contracts saw the volume of beer brewed drop by 23.3%, while its own brand range grew by 0.5%.

However, that is likely to be boosted next year after the company signed a deal in August with the Boon Rawd Brewery Company to import and distribute popular Thai brand Singha Beer.

Shepherd Neame chief executive, Jonathan Neame, said: “We remain well positioned in the sector, with great pub assets, an exciting and evolving beer portfolio, an excellent brand reputation and a heartland presence in Kent that will benefit from considerable economic development in the next 10 years.

"Our strong balance sheet and long term financing gives us a great platform to take advantage of any opportunities that arise.

"Our managed pubs have achieved substantial growth in turnover and profit. The tenanted pub estate has maintained its impressive like-for-like performance.

"Brewing and brands performance has, as expected, been more challenging this year, but we are excited by the potential of our emerging portfolio.

"We are a modern, well invested, financially strong and balanced business with a strategy designed to deliver long-term value for shareholders. We have transformed our business in recent years to increase our exposure to

the growth areas of the market.

"We are encouraged by how the new year has started and remain cautiously optimistic about the company’s prospects despite the uncertainties ahead.”

Earlier this week, its chairman, Miles Templeman, confirmed he would be stepping down from the role next year.

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