Pub group Punch Taverns
said like-for-like net income from its core estate for the first 16 weeks of the new financial year fell 1.5 percent, while sales at its demerged unit Spirit Pub Co for the same period rose 6.2 percent.

Punch's average net income per pub across the full estate, however, rose 1.3 percent over the quarter, benefiting from the ongoing disposal of non-core assets.

Punch Taverns had demerged its better-performing division Spirit in August as part of a move to cut billions of pounds of debt.

The company, which operates nearly 5,000 tenanted pubs, said it remained on track to sell 400-500 non-core pubs for the year having struggled throughout the economic downturn. Tenanted pubs are run by publicans who pay the company rent and rely on it for their beer supplies.

Separately, Spirit said it was encouraged by the strong growth in both its food and drink sales and was on track to meet its full year expectations.

Food Sales rose 7.9 percent for the 16 weeks to December 10, while drink sales rose 6.1 percent.

Spirit, which operates around 800 managed pubs, including the Chef & Brewer chain, are run directly by the company and generally have greater freedom on pricing.

Punch Taverns' shares, which have fallen more than 25 percent since it announced the spin-off, closed at 11 pence on Thursday on the London Stock Exchange, valuing the company at about 75 million pounds.

Spirit Pub's shares have also lost more than a quarter of their value since the company started trading separately. They closed at 40.5 pence, valuing the business at 270 million pounds.

(Reporting by Suzannah Benjamin and Tresa Sherin Morera in Bangalore; Editing by Gopakumar Warrier)