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Greene King in good Spirit

The acquisition of rival Spirit Pub was a key driver of half-year growth for Greene King
December 2, 2015

Greene King (GNK) investors were in good spirits - buoying the pub group's shares 13 per cent in morning trading - after half-year results showed 46 per cent growth in adjusted operating profits. The primary driver was the June acquisition of Spirit Pub Company, but there were also encouraging signs of organic growth. Greene King's directly managed estate posted like-for-like sales growth of 2 per cent in the period, ahead of the industry's 1.5 per cent according to the Coffer Peach Business Tracker.

IC TIP: Buy at 924p

One way management has tried to stimulate organic growth is by focusing on the whole day, rather than just peak evening drinking time. Greene King relaunched or introduced breakfast offers in three of its pub brands, which management said helped to drive a 9.9 per cent increase in food and drink sales before 5pm.

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