The boss of Ei Group has called on the next government to review the “concerning” business rates system, as he revealed a fall in profits at the pubs chain which is grappling with a £2.2 billion debt pile.
In response to new rates bills which came into effect in April, Simon Townsend said: “I remain very concerned. They are a tax on business and a disincentive to invest.”
He urged the government to find a “business-friendly” solution.
The plea came as Ei, formerly known as Enterprise Inns, said pre-tax profit in the six months to March 31 slumped to £13 million from £40 million. That was owing to a one-off refinancing cost.
The company is under way with a restructure to boost profits by shifting its 5000-strong estate away from the “beer-tie” model, which involves a publican renting a site and buying beer at inflated prices from a landlord in return for lower rent.
Second-half trading at the group has been strong, but the next two months are not expected to match last summer, which was boosted by Euro 2016, won by Portugal.