M&B plans 50 'at least' new openings a year

Mitchells & Butlers (M&B) is planning to open "at least" 50 new-build pubs a year in the coming years.

The company, which now operates just under 1,600 pubs will open 50 new sites — 20 on retail and leisure parks — this year and will convert 70 sites to drive brands from existing pubs within the estate.

Chief executive Adam Fowle said M&B had the capacity to open as many as 150 new pubs in a single year.

Around 90% of existing pubs are owned freehold but the leasehold mix were will "be much higher" than it's been historically — the 50 new openings this year are a 65% freehold/35% leasehold mix.

The company confirmed that it's 50-strong franchised division is on the market.

"They should leave us at some point," said Fowle. The company also indicated its television advertising campaigns for Harvester, Toby Carvery and Sizzling Pub Company had seen an average pay-back within six weeks.

A campaign is due to start for Crown Carveries and a non-television campaign for Vintage Inns.

Fowle said that the "more well-known the pub brand, the more effective" the campaign. "(For advertising) to work on television you've go to have a badge not just a pub name," said Fowle.

"We'll seek to expand advertising judiciously — it will probably double over the next couple of years."

More generally, M&B reported like-for-like food sales up 4.7% in the year to 25 September and up 6.9% in the most recent eight weeks.

Food sales are now 47% of total turnover — and around two-thirds of all sales now relate to eating out. Profit before tax for the year ended 25 September was up 26.1% to £169m.