Stonegate Offloads 100+ Pubs as Sector Pressures Persist

One of the UK’s largest pub operators has continued to reshape its estate, disposing of more than 100 venues over the past year as trading conditions across the on-trade remain challenging.

Stonegate Group, which operates around 4,000 sites nationwide and is backed by TDR Capital, confirmed it sold 109 pubs during the period as part of a wider strategic shift.

The company, which includes well-known brands such as Slug & Lettuce, said the disposals align with its ongoing “estate transformation strategy”, with a growing emphasis on leased and tenanted pubs rather than directly managed sites.

Financial results for the year to September show the group reported a pre-tax loss of £174m, while revenues declined by £128m to £1.62bn. More recent figures for the three months to January indicate sales of £476m, down from £505m in the same period a year earlier. However, losses before tax narrowed from £37m to £24m, suggesting some operational stabilisation despite ongoing headwinds.

Stonegate’s filings also show total debt edged up to £3.81bn, compared with £3.76bn the previous year. The company indicated that proceeds from pub disposals are being used in part to reduce this debt burden. Many of the sites sold have been acquired by individual operators.

Chief executive David McDowall described the past year as a turning point for the business, highlighting estate optimisation as central to its long-term plans. He said the strategy is focused on ensuring each site is positioned for sustainable performance, supported by targeted operational initiatives.

While further disposals have not been ruled out, the group stressed that any future sales would be selective and strategic in nature.

The move comes against a backdrop of continued strain across the hospitality sector. Rising labour costs and increased National Insurance contributions have added pressure to already tight margins, while energy costs and taxation remain significant concerns.

According to the British Beer and Pub Association, pubs are closing at a rate of around one per day, with high taxation, beer duty and operating costs cited as key factors. Changing consumer habits, including reduced alcohol consumption and a shift towards drinking at home, are also impacting trade.

David McDowall, CEO of Stonegate, said: “2025 was a pivotal year for Stonegate, laying the foundations of our transformation strategy. A core pillar of this strategy is reshaping our estate to ensure every pub is positioned for long‑term success.

“This focus, supported by a series of targeted initiatives, is proving highly successful.”

Emma McClarkin, CEO of the British Beer and Pub Association, said: “We are the most highly taxed of any business sector, with £1 in every £3 spent in the pub going to the taxman. We know government values the pub and to continue supporting us, they must deliver permanent, meaningful business rates reform, a cut in beer duty and VAT, and review the regulatory burden, so we can remain a cornerstone of the job market, the heart and soul of communities, and a pillar of the economy.”