Embattled pub group Punch Taverns has announced plans to hive off a number of its underperforming leased and tenanted pubs into a separate business unit.

Chief executive Giles Thornley said the move, which will affect around 1,250 pubs, would help the business turn around the struggling pubs, according to the Financial Times.

Thornley did, however, admit that some of the pubs would be sold. Trading from the “bad pubs” will be reported separately from the group’s tenanted division.

The plan to split the group’s estate comes as Punch revealed a 6% drop in revenue to £768m in the six months to March 7.

Having made a £109m interim profit in 2008, the group swung into a pre-tax loss for the period, largely as a result of £147m in writedowns on the value of its pub estate. Stripping this out, profit fell 38% to £82m.