M&B: sales up despite World Cup food hit
Managed pub operator Mitchells & Butlers (M&B) is making "good progress" on achieving the objectives laid out in its strategic plan — to ditch its wet led pubs in favour of those with a food focus.
M&B plans to double the size of six key brands — Harvester, Toby Carvery, Crown Carveries, Sizzling Pub Co, Premium Country Dining Group and Vintage Inns.
Other brands are set for selective expansion while its franchised pubs and around 300-wet led venues are to be sold off. This week it also completed the £88m sale of 52 budget hotels to Prupim.
In the nine weeks to 17 July like-for-like sales rose 1.2% despite the World Cup having a negative effect on food sales — which dropped by 2% on a like-for-like basis. This indicates an underlying growth rate of 3.2% in the nine week period.
Like-for-like sales for the 42 weeks are up 1.6% with total sales up 2.1%. It said its retail operating margin continues to improve with third quarter margins "slightly ahead" of last year.
M&B described its financial position as "robust" with a reduction in net debt and drawings on its unsecured medium term facility at £291m, excluding £88m from the recent lodge disposal.
"There continues to be uncertainty in the outlook for discretionary expenditure and associated pressure on the UK's eating and drinking out market," it said.
"However, our core brands' effective marketing and value positioning have generated increases in sales and profitability this year and form a strong platform for future growth.
"We are making good progress towards achieving the objectives laid out in our strategic plans and are confident in the future prospects of the business."
