Punch Taverns plans to put 1,250 of its struggling pubs into a new 'turnaround division' after it saw its pre-tax profits fall from £133m to £82m.

The new division includes underperforming pubs that have either closed or been identified for sale or conversion. The operator of 8,300 leased, tenanted and managed pubs revealed in its interim results for the 28 weeks to 7 March 2009 that it has already disposed of £91m worth of non-core assets during the first half-period.

The company has also reduced its gross debt by 7 per cent to £318m ahead of schedule and has seen "modest improvement" in its performance since the end of the half-year. According to CEO Giles Thorley, the company is "on track to meet its expectations for the financial year". Thorley said: "The weak UK consumer environment is likely to persist throughout the remainder of the year. Consequently, we remain very cautious over near-term trading prospects and we will continue to focus on taking prudent steps to further strengthen our balance sheet."

Earlier this year Punch disposed of six freehold properties within central London in a deal worth £21.1m with Fuller, Smith and Turner.