The pub and restaurant group believes its third quarter growth was weaker than first half of the year to the early timing of Easter.
Mitchells & Butlers, the pub and restaurant group, has reported strong sales growth for the first three quarters of the year.
Revenue increased by 5.7% compared to the same period in 2023, with all of the group’s brands, including All Bar One, Harvester, and Toby Carvery, showing growth.
However, third-quarter like-for-like sales growth was 3.4%, slightly slower than the previous six months. This slowdown was attributed to Easter falling in the fiscal first half of the year and the effects of progressive inflationary easing during a period of wet weather.
The current like-for-like sales growth rate for the most recent 13 weeks, excluding the impact of Easter in both years, is 4.2%.
In the first half of 2024, food sales outpaced drinks with a 7.7% year-on-year increase compared to a 6% rise in beverage sales. However, this trend reversed in the third quarter, where food sales grew by 2.6%, while drink sales rose by 4%.
Year-to-date, Mitchells & Butlers has completed 139 conversions and remodels, opened six new sites, and continued rolling out various energy-saving initiatives, including the installation of solar panels and sensors.
The company expects net cost headwinds of approximately £55 million for the financial year. This includes increased labour costs from the rise in the statutory National Living Wage, although these effects are somewhat offset by deflation in energy costs, a slowdown in food cost inflation, and effective cost control measures at the site level.
Chief executive Phil Urban commented: “We are pleased with the continued strong trading performance, which has remained ahead of the market through the year. As inflationary pressures have eased the level of price increase we have taken has reduced, leading to headline sales growth in line with more normalised levels as expected during the second half. The combination of easing inflationary costs and continued sales growth will ultimately benefit our profit levels for the year.
“With the unique strengths of our business, including a diverse portfolio of established brands, value proposition and enviable estate locations, we are well positioned to continue to grow profitability and market share into next year.”
In May, Mitchells & Butlers acquired Pesto Restaurants, a group of ten Italian eateries, adding to its portfolio following the earlier 2023 acquisition of the Mediterranean-themed brand Ego Restaurants.
The group’s extensive brand portfolio includes Miller & Carter, Premium Country Pubs, Sizzling Pubs, Stonehouse, Vintage Inns, Browns, Castle, Nicholson’s, O’Neill’s, and Ember Inns. Additionally, it operates Innkeeper’s Collection hotels across the UK and Alex restaurants and bars in Germany.