Mitchells & Butlers PLC (LSE:MAB) reported sales are back above pre-Covid level as it swung back into profit but warned conditions in the pub sector remain “highly challenging”.
Revenues were £2.1bn in the year to 24 September 2002, which the Harvester, All Bar One and Toby Carvery owner said equated to a 1.1% improvement over the 2019 pre-Covid period.
Sales in the current year had gone even better, it added, with the first 10 weeks seeing a 9.2% rise over two years ago ex-VAT adjustments, though chief executive Phil Urban cautioned that the trading environment remains tough with energy, food and wages inflation all putting pressure on margins.
Operating profits for the year just ended rose to £124mln (£81mln) with pre-tax profits of £8mln compared to a £42mln loss.
Inflation in the current year will cost an additional £180-£216mln (10-12%) on its cost base of £1.8bn, M&B said, though it expects to pass on much of these rises to customers.
More optimistically, Urban added the continued recovery of sales was ”encouraging”, with a "general return to office working, city centres becoming stronger and people across the country becoming ever more confident to return to the hospitality sector".
“This makes us cautiously optimistic about the future,” he concluded.