The liquor retailing, hotels and poker machine operation spun out of Woolworths a while back has increased its profits.

Endeavour Group reported a 17 per cent surge in profit to $364 million based on a 2.6 per cent rise in revenue to $6.5 billion for the first half of its financial year (from June 27 2022 to January 1 2023).

A 5 per cent decline in liquor stores sales at its outlets, such as Dan Murphys and BWS, was more than made up for by a 55 per cent jump in hotel sales as the company enjoyed a COVID-restriction free half-year, compared to lockdowns in 2021.

"Our team has delivered strong results group-wide, with a standout December from the first restriction-free festive season in three years," said CEO Steve Donohue.

The company's results announcement also revealed some modest growth in profit margins.

"Consumer preferences for premium categories and new products have continued to underpin a strong gross profit outcome.

"Additionally we have generated margin improvements through initiatives such as personalisation and promotional optimisation. These gains more than offset the impact of higher levels of promotion and increased supply chain costs.

"Gross profit margin for the half was 23.8%, representing an improvement of 12 bps [basis points]."

Endeavour was optimistic about the outlook, despite the effect of rising interest rates on consumer spending.

"In the first 5 weeks of H2 F23 [second half, financial year 2023], we have continued to see trading stabilise across the group.

"Retail sales were in line with prior year (+0.2%). Our Hotels business also performed well in this period, with sales up 31.5% on last year, which was impacted by reduced patronage and team shortages due to the Omicron outbreak (particularly in January 2022.

"While we expect to see some volatility ahead, we have demonstrated our resilience and stability as a business.

"We have not yet seen any material softening in key customer indicators but we are monitoring these closely as broader economic uncertainty continues."