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Mitchells & Butlers 'resilient' return to profit

Published:  22 November, 2011

Mitchells & Butlers, which operates All Bar One, Browns and Harvester, has returned to profit with a "resilient" set of results - total sales were up 4.9% to £1,762 million.

Mitchells & Butlers, which operates All Bar One, Browns and Harvester, has returned to profit with a "resilient" set of results - total sales were up 4.9% to £1,762 million.

Despite the board room shuffles, takeover bids and gloomy consumer environment like-for-like sales grew by 2.6% with food lfls up 4.8%.

This was mainly driven by spending more per head, as the number of meals sold was slightly lower than last year.

In the first eight weeks of the 2012 financial year, the 1,600-strong pub operator has seen lfl sales growth of 2%, driven by the suprisingly good weather. During this period, food sales (+1.8%) fell behind drink sales of drink (+3.0%).

Profits before tax grew to £132 million for the 52 weeks ending September 24, 2011, following a loss of £127 million last year.

The brand has continued with expansion plans, opening 53 new sites were opened in the year, slightly ahead of the target of 50 new openings. These included 21 of the 22 Ha Ha Bar & Grill sites acquired in November 2010, 16 new sites in retail parks and 16 other, mainly freehold sites. It also converted 48 of our existing sites to its "expansion brands".

The group said it expects "inflationary cost pressures to persist in the new financial year, especially from energy, duty and food".

Bob Ivell, executive chairman, said: "This is a resilient set of results despite a challenging year with a difficult consumer environment, board changes and a takeover approach. Mitchells & Butlers is a good business and our ambition is to make it a great business.

"We have a number of initiatives in place to do this including the simplification of our central support functions to enhance business performance. Overall, this gives us confidence in successfully growing the business in the year ahead."

Analyst Mark Brumby of Langton Capital said: "Overall, M&B remains a class act operationally but, whilst other issues remain to be resolved, shareholders may conclude that value will be slow to come out and may remain reluctant to invest in the company."

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