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It's not difficult to paint a gloomy picture of Britain's brewers and pub operators. Simply put, a combination of declining beer sales, the smoking ban, and competition from supermarkets has hit both sectors hard.

But today's results from Greene King (LSE: GNK.L - news) (LSE: GNK) contrast sharply with the disaster stories coming from competitors such as Enterprise Inns (LSE: ETI.L - news) (LSE: ETI (A024810.KQ - news) ), Punch Taverns (LSE: PUB.L - news) (LSE: PUB), and Mitchells & Butlers (LSE: MAB.L - news) (LSE: MAB).

As expected, profits and earnings per share were down. But that was pretty much the extent of the bad news. For although down, profits were still ahead of both analysts' expectations and the company's own predictions. And in sharp contrast to slashed dividends elsewhere in the industry, the dividend was marginally increased (adjusting for a rights issue) to a total of 22.4 pence per share. No desperate talk of cash preservation here, then.

What's more, despite operating in a declining market experiencing the sharpest economic contraction seen in 50 years, the company has maintained margins and grown its top line. Like-for-like sales increased 1.7%, while own-brewed beer sales rose 1.8%. Costs have been reduced, and fixed costs converted to variable costs.

Financial engineering

There's no doubt that Greene King knows a lot about brewing, pub management and marketing. From beer brands like Old Speckled Hen, Greene King IPA and Abbot Ale, to outlet brands such as Hungry Horse, Loch Fyne, and Old English Inns, the company is among the leaders, not the followers.

But it's the adroit use of some clever financial engineering that really mark out these results -- and position the company for resilient growth in the future.

A £207 million rights issue back in April permitted it to not only pay down debt by some £47 million, but also cleverly buy back a nominal £22 million of its bonds at a hefty discount -- equivalent, in fact, to a whopping 51% of their nominal value.

What's more, the influx of shareholders' cash helped the company buy 11 high-quality freehold pubs from Punch Taverns, taking its total of pubs and restaurants to over 2,500. Further purchases from distressed rivals are planned, as and when choice outlets come on the block.

"We have delivered a resilient set of results in the face of extremely challenging trading conditions," said chief executive Rooney Anand -- and in light of the bloodbath taking place elsewhere in the sector, I regard this as fair comment.

Half-full or half-empty?

But is Greene King a buy? The backdrop to the pub and brewing industries' present woes won't change. Despite my best efforts, beer sales are in long-term decline. Supermarkets are undercutting pubs, and the smoking ban isn't going to go away.

That said, food sales are growing, the estate of outlets is increasing, and Greene King is better placed than many of its competitors. And thanks to its brewing arm and clutch of leading brands, unlike a 'pure pub' operator, it can actually benefit from consumers switching to supermarket-bought beer.

What's more, helped by the recent warmer and drier weather, the first eight weeks of the present financial year have got off to a good start. Likeforlike sales are up 5.2% -- and up 10.2% at the company's Belhaven pubs in Scotland -- while brewing volumes have increased 12.1%.

So although the shares aren't screamingly cheap, I reckon Greene King still commands a rating as a value stock. The shares are well down from the £12 they touched in 2007, but at 410 pence trade at an undemanding P/E ratio of 9 on a dividend yield of just over 5%. Management have a good track record, and have adroitly sidestepped the bear traps that have caught out competitors. A 'buy', I think.