Endeavour Group boss Steve Donohue says consumers happy to be back at the pub

Endeavour Group boss Steve Donohue says he has witnessed first-hand the excitement of his customers and staff who have returned to reopened venues in NSW.

Endeavour CEO Steve Donohue: ‘I saw joy in the faces of our teams and our customers.’ Picture: David Geraghty

Steve Donohue, the chief executive of liquor chain and pubs business Endeavour Group, says he has witnessed first-hand the excitement of his customers and staff who have returned to reopened venues in NSW, putting the company on a strong trajectory to Christmas.

However, he expects the highly elevated sales at its Dan Murphy’s and BWS outlets through lockdowns to revert to more normal levels as NSW and Victoria open for business and a component of at-home consumption – where consumers were enjoying alcohol purchased at stores – switches to drinking at pubs. Releasing Endeavour’s maiden sustainability report after splitting off from Woolworths to become a publicly listed company in its own right, Mr Donohue said it was wonderful to see pubs and hotels open again in NSW.

“I saw joy in the faces of both our teams and our customers as they got back into pubs last week … people are full of joy being able to go back to a pub. It’s the way to celebrate getting back to some semblance of normal life after the challenges of all these lockdowns,” Mr Donohue said.

“It is a great feeling and we look forward to being able to bring it to the people of Victoria.”

For now, different rules apply to different states as NSW and Victoria emerge from lockdowns, complicating the pubs resurgence. Mr Donohue noted some restrictions still applied in Victoria with not all his near 100 pubs and hotels opening at the same time.

“Hotels (in Victoria) can reopen from Friday this week and we will open a number of our hotels, however we are anticipating further restriction adjustments the following week or sometime thereafter which would allow us to open up a greater percentage of our network.

“The rule at of the moment of 20 people inside the venue so we will work within those government restrictions.”

When both NSW and Victoria were shut down during the latest pandemic lockdowns, the group saw about 40 per cent of its more than 340 pubs and hotels shuttered. While Victoria is slowly opening, Endeavour has one quarter of its pubs network in that state.

The pent-up demand from consumers, fuelled by an estimated $200bn in stashed cash and savings, could prove boomtime conditions for the pubs and hospitality sectors leading into Christmas, with Endeavour looking to ride that wave of spending now about to crash over the economy.

A bartender pours beer for his customers at a Sydney pub after the easing of lockdown restrictions. Picture: AFP

“There is an excitement about being able to get back to the pub and we see that in NSW and saw it when the last lockdown ended so I don’t think time will be any different. People are really excited about getting back to the pub,” Mr Donohue said.

Endeavour will release a first-quarter trading update on Wednesday and hold its annual general meeting on Thursday, and Mr Donohue said it was natural that as pubs reopened there would be a retreat from the very high level of sales at Dan Murphy’s and BWS.

“This isn’t the first time we have been through this observation of lockdowns and the flow back of at-home consumption into on-premise consumption and we would expect some sort of reversion to take place as it has in the past.”

When Endeavour released its full-year results it showed how lockdowns had played through its businesses. Endeavour Drinks, the liquor chain arm, saw total sales in fiscal 2021 at $10.2bn, up 9.6 per cent on the previous year as sales growth was driven by the shift to in-home consumption. Helping to drive that was its e-commerce sales, which increased 34.7 per cent.

Meanwhile, the Endeavour sustainability report has committed to a number of initiatives including to having 100 per cent renewable electricity by 2030 and net zero emissions by 2050.

The retailer has also said it has set a path to develop a Reconciliation Action Plan and will establish first local community advisory panel. It follows earlier this year Woolworths deciding to scrap its long-running plan to open a Dan Murphy‘s outlet near Darwin’s airport that angered some members of the local Indigenous community and saw the retailer criticised in an independent report.

“While sustainability has always been central to how we operate, the launch of our first sustainability strategy as an independently listed business is a significant milestone in setting the course for the next phase of our journey,” Mr Donohue said.

“Our ambition is to leave a positive imprint on the communities we are part of, the people we connect with and the world we all share. We have worked with a range of diverse stakeholders to identify the areas where we can make the greatest impact.”

As part of Endeavour’s commitment to partner and work with the community, the company will establish a Community Advisory Committee in Darwin next year. The committee will consist of a local expert panel that will explore initiatives that seek to reduce the harm from the misuse of alcohol or problem gambling in that community, and will direct investment into the causes that mean the most to the community.

“Although we have committed to our goals on a national and even global level, we acknowledge that our sustainability strategy also needs to be implemented at a local level because every community is unique. We’re committed to listening and engaging with local communities to find local solutions,” Mr Donohue said.

Under the principle, Endeavour sets the path to begin work with Reconciliation Australia to develop its first Reconciliation Action Plan.