Soggy August dampens sales for M&B

BIRMINGHAM pubco and restaurant group Mitchells & Butlers has endured a tough post-World Cup period, although it has seen a near 4% increase in sales over the course of its full year.

In a pre-close trading update, the company said total sales in the 51 weeks to September 20, 2014 were up 3.8%, with like-for-like sales increasing by 0.6%.
 
It said July had been good following the football tournament in Brazil, however, sales had tailed off during August. It said pub-goers had become more cautious about spending their money and the poor weather during the month also made for difficult comparisons.

Like-for-like sales in the nine weeks to September 20 grew by 0.1%.

M&B said that during this period it had continued to make progress in improving its volume performance by delivering on key initiatives. Notably, it said it had focused on: enhancing amenity; improving guest service through better training; and investment in IT infrastructure – new pub systems have been rolled out to more than 1,000 outlets alongside new technology to deliver enhanced management information to our frontline teams.

As a result, it said it was confident the strong platform it was building would generate momentum as the business moved into 2015.

In the 42 weeks to July 19, total sales rose 0.7% (food up 0.8% and drink by 0.6%), in the nine weeks to September 20, total sales rose 0.1% (food up 0.1%) but drink down 0.2%). For the 51 weeks to September 20, food sales grew 0.7% and drink by 0.5%.

Margins were said to be below last year, as a result of lower levels of sales and also of spend per head, as the group moderated price increases to drive volume back into its sites.

In June, the group acquired 173 outlets from the Orchid Group and its results have been included within total sales for the 14 weeks following this date.  

It said Orchid continued to trade well and in line with expectations. Plans are in hand to invest in the group and M&B said it was on track to convert the first few sites to its brands prior to Christmas.

In addition to the Orchid transaction, it has also opened 22 new sites and converted or expanded nine sites this financial year.
 
Alistair Darby, M&B chief executive, said: “Despite a difficult trading period in the last quarter, the transformation of our business is well on track. Coupled with the successful integration of the Orchid estate, this gives us confidence in our future growth prospects.”