UK's oldest brewer to hike prices following Labour tax increase
Britain's oldest brewer has said it will hike its beer prices in response to rising taxes and wage costs taking effect in April.
Shepherd Neame, which runs 290 pubs primarily in the South East, said the two policies announced by the Government last year will cost it about £2.6 million a year.
'We plan to mitigate the majority of these costs over the next 18 months through price increases and cost efficiencies,' chief executive Jonathan Neame said on Wednesday.
Chancellor Rachel Reeves increased employer national insurance contributions (Nics) in the October Budget while also raising the minimum wage.
The Nics increase, which comes in next month, is designed to help fund improvements to public services such as the NHS.
But some companies have criticised the policy for making it more expensive to employ people, with hospitality groups who employ lots of people on lower wages set to be especially hard hit.
Mr Neame, whose company employs about 1,600 people, described the current market as 'challenging'.
'The additional costs imposed on our sector are most unwelcome but the business model is flexible and we can adapt to the new circumstances,' he said.
'We have an excellent pub estate and our beer business is evolving to meet current consumer tastes and trends.'
Shepherd Neame is more than 300 years old and is the oldest company of its type in the UK.
It brews beers under a range of brands including Spitfire, Bishops Finger and Whitstable Bay.
But total beer volumes fell 12.6% in the second half of 2024 compared with the same period the previous year, the company said.
Meanwhile, revenue fell slightly to £85 million, amid an 'increase in pub sales and a decrease in sales from premium bottled ales'.
Nonetheless, underlying profit rose nearly 10% to £4.2 million after a fall in inflation last year.
Mr Neame added: 'We enjoyed buoyant summer trade in July and August, with consumer and business confidence high.
'During the autumn, confidence evaporated in the run-up to the Budget. Since then, activity picked up again and we enjoyed record Christmas trading, with good growth on 2023, with many individual pub records exceeded.'
He said the increase in labour costs has 'undermined business and consumer confidence in the short term', but that he remains 'hopeful that the economy will return to a growth trajectory, with net disposable income growing and interest rates falling'.
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