M&B food pays off as chairman quits

Mitchells & Butlers’ food-led focus showed further signs of paying off as the pub group posted a total sales rise of 3.1% at last week’s annual meeting. The results offered some reassurance for investors after the announcement three days previously that chairman John Lovering will be stepping down after just a year in the job.

Despite poor weather during the Christmas period, which CEO Adam Fowle estimated to have cost the company around £2 million, food sales during the nine weeks to 22 January rose by 5.5% as part of a 2.5% overall increase. Drink sales posted a more modest 0.5% rise.

Describing the results as “a very good start to the year”, Fowle said: “These trading results, together with the encouraging performance from the two new Harvester retail park sites and the improving new openings pipeline, show that we are on track to implement our growth strategy and indicate the future potential within the business.”

In the wake of this Harvester development, M&B confirmed plans to open approximately 50 new sites across its portfolio. This development follows September’s acquisition of Ha-Ha Bar & Grill, whose venues M&B is in the process of converting into its existing food-led brands.

However, the company issued a cautious forecast about “possible future trends in customer discretionary income and input cost increases in the year ahead.”

Lovering gave no reason for his departure and his replacement is yet to be announced.

Gabriel Savage, 01.02.2011