UK: Beer sales show signs of recovery

28 January, 2010

UK beer sales show signs of lifting out of the recessionary slump as 2009 fourth quarter results show the lowest fall for two years.

The British Beer & Pub Association’s (BBPA) latest UK Quarterly Beer Barometer shows that total sales – pubs and supermarkets – for the last three months of 2009 fell by 3.6 per cent, the lowest fourth quarter fall since 2006. Sales for the whole of 2009 fell by 4.2 per cent, compared with 5.5 per cent in 2008.

Sales in pubs, bars and restaurants were down 5 per cent in the final three months of 2009 compared with the same period in 2008 – the lowest final quarter fall since 2006. Sales for the whole of 2009 were down 5.2 per cent – an improvement on the 9.3 per cent slump in 2008 and 6.5 per cent fall in 2007.

Beer sales in supermarkets and shops declined by 2.1 per cent in the final three months of 2009, compared to a fall of 6.4 per cent in the same period in 2008. In the year as a whole, however, off-trade sales fell by 3.1 per cent – the largest fall since records began in 1978.

Despite signs of stabilisation within the sector, these declines are still having a significant effect on Government revenues. Income from beer tax in 2009 is down £258 million compared with 2008, despite duty rates being considerably higher.

Brigid Simmonds, BBPA chief executive, said: “These figures show a sector starting to claw its way out of a recessionary slump.

“They also signal the most significant driver of problems in the pub sector over the last 12 to 18 months has been the down turn in the economy and the slide into recession, along with duty increases of over 20 per cent. As the economy moves into recovery, so will the beer and pub sector.  In fact, as in previous recessions, it may emerge first and fastest.

“However, it’s too early to say whether these indicators of fragile recovery will turn into a trend, particularly when we await to see the impact of shocks such as the VAT increase and big freeze of this month.

“What is certain is that any recovery could be thrown off course an destabilised by Government intervention on tax or regulation.  What is equally certain is that any move by Government to increase beer tax further this year would be very damaging and place pubs and jobs at greater risk.”