Profits fall at Mitchells & Butlers despite increase in sales

Phil Urban
23/11/2017 - 08:57
UK restaurant and bar operator, Mitchells & Butlers plc, saw its pre-tax profits fall by 18% on last year despite recording an increase in like-for-like sales and revenue.

The FTSE 250 company made pre-tax profits of £77 million for the 52 weeks to 30 September, down from £94m in the same period last year as a result of what it called “inflationary cost pressures”.

Lfl sales across the group were up 1.8% on 2016, with wet sales up 2.1% and sales of food up 1.4% on a 53-week basis .

This improvement was put down largely to capital investment, however, the uninvested estate also saw an improvement in sales at 0.6%. The company added that its sales are up 2.3% over the last seven weeks.

Total revenue for the period was £2.1 billion, up 2.6% on 2016. M&B chief executive Phil Urban said his firm was outperforming the market and that the results reflected “successful implementation of strategy.”

He said: “This year, we have continued to make progress on our three priority areas: building a more balanced business; instilling a more commercial culture; and driving an innovation agenda.

“This has resulted in a period of strong operational achievement for Mitchells & Butlers with a sustained  eturn to like-for-like sales growth driving market outperformance.  

“Cost headwinds across the industry have adversely affected margins but we continue to work hard to mitigate as much of these as possible through our focus on efficiency and profitable sales growth.

“Overall, we believe that the progress we  have made this year positions the company well to deliver long-term shareholder value.”

Adjusted earnings per share of 34.9p for the period were down 1.4% on last year with EBDITA also down from £431m last year to £429m this .

The company opened 13 new sites during the period, converted and remodelled 252 and disposed of 79. Its current estate stands at 1,695 managed businesses and 59 leased across the UK and Germany.

Mitchells & Butlers runs some of the country’s most well known pub and restaurant brands including All Bar One, Harvester, Toby Carvery and Vintage Inns.

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