Football knocks M&B food focus

Mitchells & Butlers’ new focus on its food-led business saw the pub group take a hit during the FIFA World Cup.

The month of the tournament saw like-for-like sales reduced by around 2%, compared with a 1.6% increase in the first 42 weeks of the company’s financial year.

While the British Beer & Pub Association forecast that the group stage alone would generate an £80 million boost for the pub industry, ironically those venues which have diversified their offer in troubled times to concentrate on food fell victim to the same World Cup malaise as many restaurants.

Commenting on this impact, Adam Fowle, chief executive of M&B, noted: "When an England football match kicks off mid-evening on a Friday or on a Sunday lunchtime, which are peak dining occasions, it knocks a number of people back who would normally come in."

This shortfall was compounded by the group’s failure to capitalise sufficiently on wet-led sales during the World Cup. Fowle acknowledged the ongoing problem for pubs of competing with the biggest off-trade players, saying: "We didn’t pick up enough drinkers, you have supermarkets selling 18 pints of lager for £10 and we cannot do that."

Despite expressing ongoing concern over the outlook for discretionary spending, M&B’s interim statement offered an upbeat note, saying: “We are making good progress towards achieving the objectives laid out in our strategic plans and are confident in the future prospects of the business.”

While food-led venues may have floundered, an update from Fuller’s Inns has attributed a strong performance in recent months to the UK’s good summer weather. The brewer and pub firm reported a 4.1% rise in like-for-like sales for the 16 weeks to 17 July.

Fuller’s chairman Michael Turner said: "After some glorious summer weather there are economic clouds on the horizon, but I am confident that our strategy ensures the company is well placed to deliver for its shareholders even in these continuing uncertain times."

Gabriel Savage, 27.07.2010