Suffolk brewery and pubs group Adnams has been boosted by a "positive" start to 2024 - following a very tough time for the business and the hospitality industry as a whole.

The Southwold company was upbeat about the first quarter of 2024 to March 31 as its fortunes were lifted by falling inflation - but added that challenges continue to dog the sector, which last year saw sales slump by nearly 15%.

While "multiple factors" continue to challenge the brewing, distilling and hospitality sectors, total sales rose 11% year-on-year in the period, it said.

These were buoyed by growing volumes in beer and spirits - and a notably strong contribution from its on-trade and off-trade business. 

Falling inflation was improving demand in both the on-trade and off-trade, as well as softening some its cost increases, the 150-year-old business said.

In the six months to June 2023 Adnams reported a £3.1m loss compared to a £1m loss during the same period in 2022. Last year it also shed some jobs as part of a belt-tightening operation.

But the company maintains a strong asset balance sheet of £36m - and turnover during the comparative six month period remained stable at about £30m. Operating costs, however, rose from £30.8m in the first half of 2022 compared to £32.5m in the first half of 2023.

In March, Andy Wood dismissed a report that the company was seeking a full takeover - reiterating its earlier announcement in February that it was looking more finance from the City after its "ambitious growth plans" were hit by the economic slowdown, which has hit the hospitality industry hard.

But the sale of some of its assets remains on the table.

In its latest statement, the firm said it was "continuing to explore a range of options to fund its future growth plans with the support of its advisers and has received an encouraging response to the process".

"The board's preferred option remains the raising of additional capital from another party and/or the sale of freehold assets to return capital to the company. However no decision has yet been taken," it said.

"The company will continue to keep shareholders appraised of developments at the appropriate time."

Dr Wood - who is due to retire this year - is set to be succeeded on July 1 by the group's chief financial officer Jenny Hanlon.

The company said it would be filing full-year accounts for the period ending December 31, 2023 in late May ahead of its planned annual general meeting on  June 27.