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Excellent pub/restaurant performance boosts M&B results

19 May 2005

Mitchells & Butlers (M&B) has welcomed an excellent performance from its pub/restaurant division, tight cost controls and growing food sales for a strong first-half performance.

Despite challenging trading conditions, its restaurant division now serves 1,700 main meals a week per site. Turnover increased 6.9% to £356m in the 28 weeks ended 9 April 2005, after menu changes at brands including Vintage Inns, Harvester and All Bar One.

However, the pub's division performance was dragged down by its unbranded properties with low food sales, which felt the pinch of a declining beer market. This meant operating profit fell 2.3% to £86m despite turnover increasing 3.1% to £500m.

Chief executive Tim Clarke claimed the company had continued to grow its market share with its London sites and residential brands performing very strongly.

This increasing scale of operation, combined with tight cost controls and increased productivity helped combat significant utility and regulatory cost increases, which hit M&B for £10m in period.

Food volumes were up 9% overall, and M&B bucked the declining beer market by increasing its range of beers and adding spirit and wine sales to grow drink volumes by 3%.

Group turnover was up 5% to £864m (2004: £823m) and pre-tax profit increased 4.9% to £86m (2004: £82m).

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