29th Jul 2015 07:09
LONDON (Alliance News) - Mitchells & Butlers PLC Wednesday reported growth in sales in the third quarter of its financial year driven by strong food sales and said its conversions of the Orchid business into its other brands is going as planned although it has taken a hit on operating margins.
The pub and restaurant company, which owns brands including Harvester, Toby Carvery, All Bar One and O'Neill's, said that total sales grew 5% in the 11 weeks to July 25 on the same period the year before and rose 8.2% in the 43 weeks to the same date.
Like-for-like sales grew 0.8% in the 11 weeks and 1.3% in the 43 weeks, as strong food sales offset a softer drinks performance.
Mitchells & Butlers also said that operating margins are below last year reflecting the lower margin of Orchid which it acquired last year, ahead of full integration into the company.
The company added that the government's introduction of the national living wage will "have an impact" on its cost base and so it is assessing a wide range of options to mitigate this.
"This year we have continued to successfully grow our food volumes and our like-for-like sales ahead of a subdued market, in addition to integrating and converting the Orchid business as planned. These initial conversions are trading well and in line with our expectations," Chief Executive Alistair Darby said in a statement.
Shares in Mitchells & Butlers opened up 1.6% at 401.10 pence on Wednesday.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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