22nd Nov 2018 08:54
LONDON (Alliance News) - Pub and restaurant operator Mitchell & Butlers PLC on Thursday reported an almost doubled annual profit, with sales remaining ahead of the market.
Mitchell & Butlers owns brands such as Toby Carvery, Harvester, and O'Neills.
For the 12 months to September 29, Mitchell & Butler's pretax profit was GBP130 million, up from GBP77 million a year prior. In its prior year, pretax profit had fallen 18%.
Full year adjusted operating profit was GBP303 million, down 1.6% year-on-year, but the second half figure increased by GBP3 million year-on-year, "a significant milestone".
Revenue has fallen slightly, the company said, to GBP2.15 billion from GBP2.18 billion, but like-for-like sales in the year increased 1.3%. In the seven weeks since September 29, Mitchell & Butlers said, like-for-like sales are up 2.2%.
Total sales were up 0.5%, held back by pub disposals made in its previous financial year.
Food sales increased 0.3% year-on-year on a like-for-like basis, while drink sales were boosted by warm weather to register 2.6% like-for-like growth.
Mitchell & Butlers is not paying a final dividend, having paid 5.0 pence last year. In November 2017, at the time of its last annual results, the company said it would pay no interim dividend for financial 2018 and on Thursday scrapped the final payout as well.
The company said sales growth was ahead of its market for a second year in a row despite long periods of snow and hot weather, and England's success at the football world cup.
Mitchell & Butlers highlighted several issues challenging the eating-out industry, including higher supply than demand and lower consumer confidence, while the impact of Brexit remains uncertain.
Chief Executive Phil Urban said: "Focus on our three priority areas of building a more balanced business; instilling a more commercial culture; and driving an innovation agenda has continued to move the business forward over the financial year.
"The implementation of the second wave of initiatives from our transformation programme has resulted in sustained like-for-like sales growth, continued market out-performance and a return to profit growth in the second half despite Easter moving into the first half," Urban continued.
"We continue to work hard on driving efficiency gains and profitable sales growth through the ongoing roll out of initiatives to mitigate the cost headwinds impacting the industry."
Shares were down 1.1% on Thursday morning at a price of 264.67 pence each.
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