Mitchells & Butlers sees annual profits jump 26%
Pubs and restaurants group Mitchells & Butlers has seen its annual pre-tax profits jump 26.1% to £169m, but warned about the consumer spending outlook.
M&B, which owns Harvester and All Bar One, made revenues of £1.98bn, up 1%. But the growth in like-for-like food sales rose 7%, underlining M&B's strategy to concentrate on the eating-out market. M&B said current trading is good, but warned that consumers may be hit by spending cuts and the VAT rise. The rise in profits was boosted by M&B's debt reduction programme, which cut the company's interest bill. Net interest paid during the year was £147m, down £13m from the previous 12 months, with M&B slashing net debt by almost £300m to £2.3bn. The Birmingham-based company is selling many of its non-core pubs and late-night High Street bars. Adam Fowle, chief executive, said that "excellent progress" is being made against this strategic goal. Beer and other drinks sales were down 0.7%, held back by the sale of many of the company's drinks-led pubs. The company owns about 1,600 outlets, which it says are pitched towards the eating-out market. Some 47% of group sales came from food in the year to 25 September. In the eight weeks to 20 November group like-for-like sales were up 3.7% continuing the underlying rate of growth seen over the last six months, the company said. M&B is not paying a dividend.