Soaring wage costs and Brexit-hit pound hit profits at Mitchells & Butlers
The owner of All Bar One and Harvester has reported falling half-year profits after taking a hit from the Brexit-hit pound and soaring wage costs.
Mitchells & Butlers said profits fell almost 10% to £75 million in the six months to the end of April, despite a number of measures put in place to mitigate the effects of rising inflation.
Boss Phil Urban said: "Margins have been adversely impacted by increased costs, most notably from wage inflation, property costs and exchange rate movements.
"In order to partially mitigate these costs we have been working hard to encourage our guests to trade up and increase spend per head for a more premium experience whilst challenging our general managers to run their businesses as cost effectively as possible."
The group also noted that wholesale food inflation increased 6% in March and s aid that it has carried out "some price adjustments", including increases and reductions, as a result.
In better news, like-for-like sales at Mitchells rose 1.6% in the period, with overall sales growing 2.4% to £1.2 billion.
Mr Urban added: "Overall, we are pleased with the turnaround in our sales trajectory and relative performance against the market. In a challenging cost and consumer environment we will continue to focus on our three priority areas."
Mitchells 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.