Page last updated at 18:01 GMT, Tuesday, 22 July 2008 19:01 UK

Falling beer sales hit Enterprise

Man drinking beer
Enterprise said beer sales continued to be subdued

Enterprise Inns has warned that falling beer sales and the cost of helping its struggling pub tenants is putting pressure on its profits.

Shares in Britain's second-biggest pubs group, which has 7,700 tenanted pubs, closed down 13.4% in London.

It said licensees "are having to cope with difficult trading conditions".

In the first six months of the year, it put more than 3.5m into its business recovery scheme, offering reduced rents and discounts for struggling landlords.

It expects to spend about 8m on the scheme this year.

"Across the sector, whilst food sales are growing, on-trade beer sales continue to be subdued, with industry sources suggesting close to double-digit volume declines in the period from April to June," the company said in a statement.

"Consumer confidence is low and the rising costs of food, fuel, mortgage costs and taxes have put increasing pressures on disposable income and discretionary spend."

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