Shepherd Neame chief executive Jonathan Neame

by business editor Trevor Sturgess

Flat half-year profits at Shepherd Neame, the brewer and pub owner, have been blamed on "unremittingly" bad weather and an Olympic factor that failed to fizz.

In what the 300-year old Faversham company called "a challenging market", operating profit came in at £6.7 million, the same as last year, and pre-tax profits fell slightly from £4.8 million to £4.5 million.

But strong Christmas sales helped push up revenue by 2.6% to £69.2 million in the six months to the end of December.

Pubs and hotels did well, with managed house like-for-like sales up 2.9%, with drinks up 2.4%, food up 3.5% and accommodation up 5.8%.

Tenanted like-for-like earnings before interest, tax, depreciation, amortisation and rent payable (EBITDAR) edged up 0.4%, with average EBITDAR per pub up 3.9%.

There was good news for shareholders who will receive a 5p interim dividend, up from 4.9p in the same period a year ago.

Jonathan Neame, chief executive, said: "I am pleased to report a solid performance for the 26 weeks to 29 December with robust Christmas trading following the exceptional comparable period in 2011. Our performance reflects the underlying strength and resilience of our business as we have invested consistently in our brands and pubs over the long term."

Chairman Miles Templeman added recent market conditions had been particularly challenging with on trade beer sales down 4.7% for the 12 months to the end of December 2012 and off trade sales down 7.5% in the final quarter.

He blamed "unremittingly wet and dull weather" and lower-than-expected trade during the Olympics. He said the anticipated boost to tourism from London 2012 did not materialise and there was increasing caution from the consumer as the economy continued to falter.

Operating profit was also hit by a tenfold spike in the cost of glass recycling and the collapse of a major customer.

Sheps owns 353 pubs, with 307 tenanted or leased, and 46 managed. The company bought the Royal Wells Hotel and Beau Nash pub in Tunbridge Wells for £3.6m but earned £1.9m from asset sales.

Meanwhile, Sheps announced it would stop brewing Kingfisher Beer under licence within the next three financial years to concentrate on core brand and brewing strategy, and "reduce our exposure to large-scale contract volume".

Bill Brett, executive chairman of the Brett Group, the Canterbury-based construction and building materials business, is joining the board as a non-executive director, replacing Randall Nicol who retires in September.