Mitchells & Butlers sales slow amid more ‘challenging’ trading
Mitchells & Butlers said like-for-like drink sales fell 1.2% in the eight weeks to September 16 in a reversal of the surge in the previous 10 weeks.
The owner of All Bar One and Harvester has revealed a hit to drinks sales as the recent chillier weather has put off pub-goers.
Mitchells & Butlers said like-for-like drink sales fell 1.2% in the eight weeks to September 16 in a sharp reversal of the 3.8% surge seen in the previous 10 weeks.
The group blamed the poor weather in August and so far in September, although it said it outperformed the market.
Total sales edged 0.3% higher in the most recent eight weeks after more food sales, which rose 1.5% in an improvement on the 1.3% increase seen at the height of summer.
Mitchells said: “Following a strong sales performance in early summer, the market has been more challenging in recent weeks, particularly given poor weather this year up against a sunny period last year which has specifically impacted drink sales.”
The group said like-for-like sales in the 51 weeks so far of its financial year are up 1.8%, with drink up 2.1% and food 1.4% ahead.
But it reiterated that soaring costs will weigh on profit margins for the full year.
The industry has been under pressure from rising costs on a number of fronts, including the national living wage, property costs and the weak pound.
Mitchells chief executive Phil Urban said: “Whilst the weather in August and September has adversely affected the market we remain encouraged that our like-for-like sales performance continues to outperform the market.”
“We continue to work hard to mitigate the cost headwinds faced by the industry,” he added.
Mitchells – which also owns Toby Carvery, O’Neill’s and Ember Inns – is in the process of overhauling its pub estate, targeting more upmarket brands.
The group has launched Sizzling Pizza & Carvery and Sizzling Pub & Grill in an attempt to fight back against new competition in the eating out sector.
Analysts at Goodbody said Mitchells had reported a “solid” trading update, adding the underlying sales growth is “further evidence that management’s estate refurbishment plan is steering the group in the right direction”.