M&B shares rise on rosy outlook for managed pubs

Shares in Mitchells & Butlers (M&B) were outperforming the market today, boosted by good trade numbers across the managed pub sector and news that it had completed its planned sale of 333 pubs.

The group's stock was up nearly 2.5 per cent as it confirmed it had signed off the £373m disposal of the mainly wet-led sites to the privately-backed Stonegate Pub Company, headed by Town & City Pub Company (T&C) chairman Ian Payne.

Payne hopes to fold most of the 333 sites into T&C, while M&B looks to focus more on the food-led pub market.

Since John Lovering took over as M&B chairman at the start of 2010 the group has stressed its desire to move more towards what it sees as the growth market, namely food-led operations.

However it has consistently said it has no plans to offload premium-end drinks pub brands such as Nicholson's.

A spokesman for M&B said such a concept offered a wide cask ale range and more draught products than similar tenanted or leased pubs. He added food was a growing part of the sales mix; keeping the culture and attitude of a pub but driving other areas of the offer.

With like-for-like food sales up around six per cent and drinks sales "doing well to stay in positive territory", M&B's strategy was only a reflection of what was going on in the wider market, the spokesman added.

"We are getting more customers in on the basis of our food offer," he added.

His comments came as new research from the Coffer Peach Business Tracker suggested that top-end managed pub operators had seen like-for-like sales rise 2.2 per cent in October, compared with the same month last year.